Are you having a baby? Having a baby changes a lot of things, your finances being one of them. Read on to learn the top financial must-dos for new parents.
If you are expecting your first baby, congratulations! You’re about to go through an exciting, yet challenging new journey.
You might be worried, though, about your financial situation. There’s nothing like a new addition to the family to set your priorities straight. Well, the good news is that you have come to the right place by reading this article.
One study done by the United States Department of Agriculture discovered the typical cost of having a child. It found that the average annual cost of every child is around $12,980 for a middle-class family. It’s clear that you might have a lot of work to do to fully prepare for these financial responsibilities.
Don’t get overwhelmed just yet, though. There are plenty of strategies you can practice now and in the future. Detailed below are the top ten things new parents must do to get – and stay – financially stable.
Table of Contents
1. Start with a Sensible Budget
Before you do anything else with your finances, it’s important to start with a solid budget plan. Hopefully, you’ve already mastered the art of a monthly budget that works for your family. With the new addition, though, there are other things you’ll need to think about.
You’ll need to buy food, diapers, clothes, toys, and tons of other things that babies need on a regular basis. That means you really need to prepare for those added expenses.
Make sure you give yourself plenty of cushion with this new budget. You need to be able to be flexible in case of surprise costs that come up here and there.
2. New Parents Have To Learn How To Save
No matter what, make absolutely certain your budget allows you to save something every month. In fact, you should invest in both a regular savings account for your future and an emergency fund. That way, even when your new life throws you an obstacle, you’ll be prepared to at least cover the financial costs.
3. Stay On Top of Your Credit Score
You’ve heard a lot about the importance of a solid credit score already. Still, you might not know about the best ways to stay on top of it. The good news is that there is plenty of professional guidance available to help you.
Still, it’s important that you’re able to trust the guidance you come across. Discover more about personal financial resources that have a trustworthy reputation. You deserve to have the peace of mind that comes from knowing your credit situation is in a stable condition.
4. It’s Okay if You Need To Downsize
Perhaps you’ve done the math, made your budget, and realized that you won’t be able to cover your new expenses as they are. If that’s the case, you have to be willing to downsize.
Perhaps this means you move to a smaller, more affordable home before the baby arrives. If that isn’t an option, one of you new parents might have to consider getting an extra job to cover all of your necessities.
5. Don’t Be Afraid To Invest
Perhaps, though, you do have all of your expenses covered month-to-month. If you even have some financial breathing room, you should definitely invest.
Do plenty of research before you invest in just anything, though. If you want to invest in long-term mutual funds, it’s a good idea to seek guidance from a certified financial planner.
If you want to invest something on your own, that’s okay, too. Once again, just make sure you do some research. Check out this article about investing in cryptocurrency, for example, if you’re interested in going that route.
6. Research the Best Health Insurance Available
It’s no secret that your new baby is going to need medical care throughout his or her childhood. That’s why it’s crucial to make sure you and your family have a stable health insurance plan that you’re comfortable with. Take some time with your partner to figure out what your best option is going to be.
7. Prepare for Maternity/Paternity Leave
Having a baby takes a lot of time and energy out of new parents. That’s why maternity and paternity leave from work were both created. This type of leave is usually paid, allowing new parents to bond with their newborn.
Unfortunately, in the United States, paternity leave is way less common than maternity leave. Still, make sure you both check with your employers to see what options are available. You’ll be grateful if you both get a couple of months off to make the most of this new, exciting experience.
8. Consider Life Insurance and Your Will
It might be morbid to think about, but it’s never to early to consider what would happen to your new child in the event of your untimely death. Before he or she is even born, it’s a good idea to make sure all of those bases are covered. Not only should you invest in a good life insurance plan, but consult a lawyer about setting up your official will.
9. Automate As Much of Your Finances As Possible
Many new parents find that keeping deadlines is difficult. Instead of accidentally missing a payment, you might find that your life is easier if you automate paying bills and such. That way, you’ll get used to the automatic expenses, and you’ll have more focus on your newborn.
10. Don’t Be Afraid To Ask for Help
No matter how much research you do, life still gets messy. It’s important to surround yourself with a community of caring people you can trust.
That way, if you get in a bind, don’t be afraid to ask for financial help if you need it. Your child is worth the humility.
Continue Your Research
At the end of the day, no amount of reading is going to fully prepare you for your life as new parents. You need to be ready for a completely new lifestyle.
We know how important it is to feel at peace when it comes to starting your family. That’s why we do our best to bring you as much financial guidance we can to help you along your journey. We encourage you to keep up with our family and money articles to continue to stay informed during your new adventure.