The arrival of a new baby consumes everything. For the first few weeks, the time you are awake is a cycle of breastfeeding, changing diapers, and Google. “Baby (is it normal to fill in the blanks)”.
Gathering energy and attention for routine tasks such as taking a shower or paying an invoice can feel like a daunting order. You’re lucky to remember how many days it is, much less when your next credit card payment is due.
In the future, you’ll benefit yourself from sleep deprivation and start financial preparation early in your pregnancy, allowing you to do things with autopilot for some time after your baby arrives.
If you don’t have the budget yet, start there, says Cecilia Williams, mother, certified financial planner, and chief operating officer of financial planning firm Halbert Hargrove.
“Please outline all your current income and expenses so that you and your partner can better understand where your money goes each month,” says Hargrove. “This is a priority 1 to have a starting point, as it absolutely needs to be adjusted as it approaches the deadline.”
Next, make a plan to manage other costs associated with childbirth, large and small.
Study the cost to deliver your child
Childbirth price tags are expensive. The average cost of delivery ranges from $ 10,000 to $ 20,000, depending on where you live. Even with insurance, new parents can expect to pay thousands of dollars from their pockets for childbirth care.
Contact your insurance company or the hospital planning the delivery to get a more specific number. Then dig deeper into your health insurance to understand your co-insurance, deductions, caps, and coverage limits.
Anthem, United Healthcare, and other major insurers have tools that you can use to get a plan-based estimate of total and out-of-pocket costs. Use these numbers to set realistic savings goals to cover them.
Do you have access to a flexible spending account? If timing permits, set up donations to save hospital invoices in a tax-free and step-by-step manner. Once your hospital invoice begins to be submitted, you can pay directly from the FSA or apply for a refund using your reward credit card.
Plan for childcare leave in advance
Paid parental leave is not guaranteed. In fact, only 11 states and Washington, DC pay vacation laws, some of which do not come into force for several years. Also, according to a 2019 survey of employer health benefits by KFF, a nonpartisan healthcare think tank formerly known as the Kaiser Family Foundation, only 25% of employers offer some form of paid leave. doing.
If you paid your vacation through your employer, ask early. Find out how many weeks are covered and what percentage of your salary is covered. Should I use vacation and sick leave first?
You also want to know when and how benefits are paid, especially if the benefits are provided by multiple sources. Believe me, you don’t want to be a week after giving birth to email your benefit provider to unravel the logistics of your vacation payments.
If you can’t take paid leave or plan to add unpaid time, practice living on the reduced income possible. This will help you identify the cost of options to reduce or eliminate before your baby arrives and build a savings cushion.
Started “payment” for child care
Child care is the largest monthly fee for most new parents. Get off to a jump start by “paying” for day care long before your baby arrives.
Put money into another savings account (ideally an interest-earning account) weekly or monthly. This helps you adapt to new costs and allows you to deposit months of childcare costs available for prepaid costs such as deposits and application fees in the bank.
Don’t know the cost of childcare in your area? Ask a group of friends or a local parent group to understand the cost of day care, nanny, or other arrangements.
You can also incorporate other baby’s necessities, such as diapers, formulas, and baby wipes, into your budget to make informed guesses. It doesn’t have to be perfect. You can adjust the way.
Automate invoice and credit card payments
Set recurring invoices to automatic payment. Ideally from one account or credit card. If possible, go one step further and set the card for automatic payment as well.
Curly Campbell, a blogger and two housewives, says this was one of the best things her family did before they had their first child.
“All the various bills were processed without our positive attention,” she says. “I had to check my bank account only once a month to make sure I had enough money for the lump sum payment.”
This column was provided to The Associated Press by the personal finance website Nerd Wallet. Kelsey Sheehy is a writer for Nerd Wallet. Email: firstname.lastname@example.org. Twitter: @kelseylsheehy.
NerdWallet: Budget for New Parents: How to Budget Your Baby https://bit.ly/nerdwallet-baby-budget-new-parents
4 money moves before the baby arrives [Millennial Money]
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