Home > Personal Finance > How to Get Ready for a Baby & All the Costs That Come With It

Comments 0 Comments

Congratulations, you’re pregnant! Now that a baby is on its way, you need to prepare financially for its arrival.

If figuring out how to make things work financially with another mouth to feed makes you more nauseous than morning sickness, then this article can help you prioritize the things you need to do to ensure that you’ll be able to afford all the diapers and onesies that you’ll soon have to buy.

Here are eight things to do to prepare financially for your baby.

1. Create a Budget

Having a baby is expensive, which means you’ll have to tweak your budget in order to accommodate baby expenses. Since you probably won’t be getting out too much with a newborn, you can start by cutting back on entertainment expenses and dining out. You may also consider cutting back on things like new clothes, and other luxuries.

Try to save up as much as possible before the new baby is born by adopting your baby budget throughout your pregnancy. That way you’ll have a better idea of how to manage your budget when your new baby arrives. If you’re having a hard time making ends meet despite cutting back in all possible areas, you may consider taking on some freelance work, a side hustle or a second job or doing something drastic to cut back like moving to a cheaper apartment or house. The last thing you want to take on while adjusting to life with a new baby is extra debt — it can take a toll on your credit score and cost you tens of thousands of dollars over the course of a lifetime. You can check your credit scores for free on Credit.com to see where you stand.

2. Move Now

Many people move when they start or expand their family either because they want to live in a better area, move to a cheaper place, or move to a place with more space. If you think you might need to move because your current apartment or house isn’t big enough or because it’s too expensive, be sure to do that sooner rather than later. The last thing you want to do is to move when you’re very pregnant or have an infant. If you do that, you’ll most likely have to rely on expensive movers. You might also rush through the process of choosing a new place, which could cause you to pay hundreds more a month than you have to.

3. Save on Baby Buys

If you bought everything that the experts recommend you have for a baby brand new, you’ll end up spending several thousand dollars — which you might not have. Instead of buying everything, think carefully about what you might need before shopping. Also, consider borrowing things from friends, or buying them used on Craigslist or at resale stores. Look for sales and remember that you can resell the things you buy when your baby gets older. Just be careful not to buy things like used car seats or cribs due to safety issues.

4. Adjust Your Health Plan

If you don’t have health insurance, now is the time to sign up. If your employer offers you a number of health plan options, now might be time to change your plan in preparation for the extra pregnancy and delivery costs. Find out how much it will cost you out of pocket with each potential option and choose one that will help save you money.

5. Start or Add to an Emergency Fund

If you don’t have an emergency fund, now is the time to start saving money. The last thing you want is to run out of money or have financial difficulties while you or your partner is staying home with the baby. If you do have an emergency fund, consider adding to it since your expenses will increase and your income will likely decrease during the first months of your baby’s life. This extra financial cushion could be just the thing you need if something goes wrong.

6. Plan for Child Care

The next thing you need to do is plan for child care. If one of you wants to stay home with the baby, now is the time to make sure that you can afford it by calculating your costs and seeing if you can make it work with only one income.

If you were planning on putting your baby into day care and returning to work, be sure to look into how much it costs. New parents are often surprised at how expensive quality child care is, so be sure to budget enough for it. On top of this, in some cities it can be difficult to find and secure a child care spot for an infant or young baby. Some parents put their names on a waiting list while they’re pregnant!

7. Prepare for the Worst

No one chooses to have a child thinking that the worst will happen but sometimes the worst does happen and it’s important to prepare for it. That means that you should take out quality life insurance, disability insurance and write a will. Most people estimate that you will need life insurance worth five to 10 times your income. If your work does not already offer disability insurance, find a policy that will protect you in case you get injured. Finally, it’s important that you know who will be taking care of your child should something happen. Taking these steps can give you significant peace of mind and ensure that no matter what happens your child is cared for.

8. Save for College 529 Plans

Parents want the best for their children and nowadays the best thing you can do is help them go to college. Don’t wait until they’re teenagers to start saving. Instead, start saving now and compound interest will help ensure that you can do more. Research 529 Plan options and choose one that’s right for you.

More Money-Saving Reads:

Image: Wavebreak Media

Comments on articles and responses to those comments are not provided or commissioned by a bank advertiser. Responses have not been reviewed, approved or otherwise endorsed by a bank advertiser. It is not a bank advertiser's responsibility to ensure all posts and/or questions are answered.

Please note that our comments are moderated, so it may take a little time before you see them on the page. Thanks for your patience.

Credit.com receives compensation for the financial products and services advertised on this site if our users apply for and sign up for any of them.

Hello, Reader!

Thanks for checking out Credit.com. We hope you find the site and the journalism we produce useful. We wanted to take some time to tell you a bit about ourselves.

Our People

The Credit.com editorial team is staffed by a team of editors and reporters, each with many years of financial reporting experience. We’ve worked for places like the New York Times, American Banker, Frontline, TheStreet.com, Business Insider, ABC News, NBC News, CNBC and many others. We also employ a few freelancers and more than 50 contributors (these are typically subject matter experts from the worlds of finance, academia, politics, business and elsewhere).

Our Reporting

We take great pains to ensure that the articles, video and graphics you see on Credit.com are thoroughly reported and fact-checked. Each story is read by two separate editors, and we adhere to the highest editorial standards. We’re not perfect, however, and if you see something that you think is wrong, please email us at editorial team [at] credit [dot] com,

The Credit.com editorial team is committed to providing our readers and viewers with sound, well-reported and understandable information designed to inform and empower. We won’t tell you what to do. We will, however, do our best to explain the consequences of various actions, thereby arming you with the information you need to make decisions that are in your best interests. We also write about things relating to money and finance we think are interesting and want to share.

In addition to appearing on Credit.com, our articles are syndicated to dozens of other news sites. We have more than 100 partners, including MSN, ABC News, CBS News, Yahoo, Marketwatch, Scripps, Money Magazine and many others. This network operates similarly to the Associated Press or Reuters, except we focus almost exclusively on issues relating to personal finance. These are not advertorial or paid placements, rather we provide these articles to our partners in most cases for free. These relationships create more awareness of Credit.com in general and they result in more traffic to us as well.

Our Business Model

Credit.com’s journalism is largely supported by an e-commerce business model. Rather than rely on revenue from display ad impressions, Credit.com maintains a financial marketplace separate from its editorial pages. When someone navigates to those pages, and applies for a credit card, for example, Credit.com will get paid what is essentially a finder’s fee if that person ends up getting the card. That doesn’t mean, however, that our editorial decisions are informed by the products available in our marketplace. The editorial team chooses what to write about and how to write about it independently of the decisions and priorities of the business side of the company. In fact, we maintain a strict and important firewall between the editorial and business departments. Our mission as journalists is to serve the reader, not the advertiser. In that sense, we are no different from any other news organization that is supported by ad revenue.

Visitors to Credit.com are also able to register for a free Credit.com account, which gives them access to a tool called The Credit Report Card. This tool provides users with two free credit scores and a breakdown of the information in their Experian credit report, updated twice monthly. Again, this tool is entirely free, and we mention that frequently in our articles, because we think that it’s a good thing for users to have access to data like this. Separate from its educational value, there is also a business angle to the Credit Report Card. Registered users can be matched with products and services for which they are most likely to qualify. In other words, if you register and you find that your credit is less than stellar, Credit.com won’t recommend a high-end platinum credit card that requires an excellent credit score You’d likely get rejected, and that’s no good for you or Credit.com. You’d be no closer to getting a product you need, there’d be a wasted inquiry on your credit report, and Credit.com wouldn’t get paid. These are essentially what are commonly referred to as "targeted ads" in the world of the Internet. Despite all of this, however, even if you never apply for any product, the Credit Report Card will remain free, and none of this will impact how the editorial team reports on credit and credit scores.

Your Stories

Lastly, much of what we do is informed by our own experiences as well as the experiences of our readers. We want to tell your stories if you’re interested in sharing them. Please email us at story ideas [at] credit [dot] com with ideas or visit us on Facebook or Twitter.

Thanks for stopping by.

- The Credit.com Editorial Team