Planning for a New Baby: The Financial Decisions You Should Make

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Responsible parenthood starts by the time parents carefully plan having a new baby. There are so many factors to consider before finally deciding to invite the stork to drop by and bring in a ‘bundle of joy.’ The most important consideration of course would pertain to the financial aspects of the parents.

It could be very costly to have a baby. Whether you are planning to have one for the first time or you plan to have a new one for the second or third time, you need to properly prepare for all the necessary expenses that would come from Day 1 of pregnancy to the day of birth. Bigger expenses come after birth as there is a need to feed, clothe, and eventually educate the baby.

There are important and practical financial decisions you should make if you are finally planning to have a new baby. Here are those.

Possible income loss

It is normal these days for both husband and wife to have their own jobs to make ends meet. If you plan to have a new baby, that setup might change. The wife has to decide temporarily leaving employment to give way to pregnancy.

After birth, she may decide to spend a few more months to take care of the newborn. This decision may cripple the household’s finances especially if the wife is significantly contributing to the income of the family. The budget has to be adjusted to account for the income reduction or loss and for the addition of another mouth to feed.

Saving more money

As you plan for a new baby, you should immediately start saving more for the future. Aside from saving for the possible costs of pregnancy and giving birth, you must save for basic baby expenses (for formula milk, nappies, supplements, baby clothing, pediatrician checkups, etc).
Likewise, it is better if you could save for the baby’s education earlier. It could be ideal to start opening an education savings account for the baby. By the time he/she starts schooling, you would surely have enough money to pay for tuition fees and school supplies. As parents, you should also start thinking about university education costs.

More savings

Parents should also think about ways to generate more savings. First-time parents usually spend so much for buying stuffs for the newborn. Do you really need to buy expensive cribs, baby cloth, and furniture for the coming new child? You could only use those for just a couple of months.

If it is your second or third baby, you could decide to re-use some items for your new baby to save on costs. If it is your first baby, you may borrow cribs from your relatives or friends. Try the traditional cloth diapering rather than using commercially available diapers, which may be more expensive.

Avoid so-called ‘baby guilt’ or the feeling that as parents, you must spend more dollars for your beloved child. Your newborn would not care if he/she uses a $500-stroller or if he/she sleeps in an expensively furnished room. It is enough that the room the baby would use is clean and safe even if it is not lavishly decorated. Always remind yourself of the need to save on costs so you could adjust to the financial challenge of raising a new baby in the family.

Andrew is a young parent, who had to adjust his lifestyle for the arrival of his son. When he not taking care of his new born, Andrew helps people with bad credit loans

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