When planning a wedding it’s not uncommon to spend $10,000-$30,000 on a one day event. Having a child is no different. Being financially responsible from the start can help you get to where you need to be and take stress off of you by being prepared. We teamed up with Jenna Reimer of Northwestern Mutual, and a fellow GBD client and mother of 4 (including a set of triplets) to give us some pointers on creating a financial plan for parenthood. Connect with Jenna on Facebook, and learn more about Nothwestern Mutual.
1. Prioritize your needs
We all want the latest and greatest in baby gadgets and let’s be real, walking the aisles of Target with the scanning gun to create your baby registry is an overwhelming and fun date! Keep it simple. Identify your needs vs the wants. We have taken the hard part out of this, and here are our suggestions to the most basic baby checklist: Get Your Baby Registry List Here
Another thing to consider is considering who will be your village. Your mother? Mother-in-law? Sister? Friends? Most will have their own families and will be able to help as they can but when it comes down to counting on someone consider looking into postpartum care. From extra hands, self care (like a nap, shower or be able to just run some errands), and having continuous connection to an expert in baby care that gives you the space to have a gentle recovery from childbirth. Prioritizing your early parenting time and recovery, is a way where saving can be a very good idea. Our most popular package is the maternity leave 100 hour package. A doula will come to you a few times a week for your entire time of leave to help you grow in your confidence as a new parent and catch up on sleep!
2. Use your already available resources
Call your insurance and ask questions to see what is covered and what is not. From how many ultrasounds, to your hospital stay, you will feel confident knowing exactly what your plan covers so there are no surprises. Learning your options for what can be covered with your HSA and FLEX spending accounts can be beneficial too. If you are really ahead of the game, you can change your insurance plan ahead of time to include a HSA plan or FSA, purchase supplemental insurance, and in some cases daycare and postpartum care can actually be built into these as well. A financial planner can also help you navigate the insurance world, if you need some direction in how to go about all of this. For a breakdown of what costs to expect, review this article that breaks down The Cost of Having a Baby.
3. Creating a Budget and the Emergency Fund
No one wants to sit down and admit how much they spend at Starbucks in a given month, but it can be eye opening when you see just where your money is being spent. Starting to save now even if it’s $10-15 a week, will help your budget stay on track and your fund to grow. Maybe something fun, such as the penny challenge where you start saving a penny on day 1, 2 cents on day 2, and so on and so forth. At the end of 365 days, you’ll have $667.95. And no, we aren’t saying you need to give up Starbucks entirely. Use these Budgeting Tips to help you get started.
4. Get Your Affairs in Order
We get it, no one wants to think about worst case scenarios, but by taking the time to put these three things in order it can save you money, stress, and time in the long run.
Life Insurance can be budgeted, depending on what your goals are. From term to full life plans, you will want to think of covering lost income, funeral expenses, and college funds. It can be built into almost any budget, and is something very important to think about.
Drafting a will is another must have, and we’re not talking about just writing your wishes on paper and putting in the safe. Sitting down with a professional, which starts at around $600-800.00. It’s worth every penny, and could even likely be covered by your penny jar savings. Start thinking about Estate Planning here.
Talking to a financial planner about disability insurance is another thing to consider. Here is a great article about how stay at home parents should have disability insurance (we were surprised too!)
5. Partner Communication and Connections
Last but not least, make a plan to take care of you and your relationships! From date nights, massages, to that weekly therapy appointment, make sure you are a priority. Make time to be with your partner, and to really be present with them (maybe a phone free date). After months of Netflix nights, it might be good to get out and do something. Even something fun like a date night subscription box where each month is a different theme and idea. Find a way to have fun and connect.
Becoming a parent is a huge transition, and can take the realities and responsibilities of being an adult to the next level. Taking steps to make it a smooth and easy transition, will not only benefit your family in the short term but in the long term too. Having a successful financial plan in place can lower stress, and you know what less stress means right? More time to do what you love, and more sleep!