Starting a family is a wonderful adventure, but it takes a lot of planning. Beyond darling onesies and the perfect bassinet, you must ensure you're ticking the boxes for financial planning. From prenatal considerations to birthing expenses to planning for college, this checklist will make sure you don't overlook anything.
Prenatal Planning
Here's what you can do to map out expenses before the baby comes:
Get to know your health insurance - Study your health insurance policy and ask questions to understand what is and is not covered. This will help you decide which doctors to visit, which hospital to deliver in, and which pediatrician to choose. It can also help you save money! Many health insurance plans cover breast pumps and other equipment, so use your knowledge to your advantage.
Draft a budget - A baby means expenses can start popping up everywhere. Co-pays, new clothes and furniture, hospital stays, and diapers all add up quickly. Planning and budgeting for these items will help you avoid going into debt and ensure that you stay on course with your financial plan.
Familiarize yourself with family leave - Take the time to understand how much new parent time is allocated to you and your partner and how much compensation you will receive.
Set up an emergency fund - If you haven't already done so, this is a great time to start putting money away for a rainy day. With kids, you never know what's going to happen!
Baby's First Days
Once your bundle of joy arrives, it's time to tackle a few more things to keep you financially healthy:
Add your child to insurance – Those first days after your baby is born can be hectic, but don't forget to call your health insurance provider and add your child to your policy. Insurance companies have strict policies surrounding special enrollment periods, and overlooking this crucial step could cost you.
Update wills and trusts – In the event that something should happen to you or your partner, you want your child to be taken care of. Staying on top of wills and living trusts will ensure your financial legacy is passed on.
Planning for Life
Establishing a budget for your child from the early days will set them up for success. Here are a few smart ideas:
Create a college fund – Consider setting up a 529 or other college savings plan. Making smaller contributions over 18 years is a lot more cost-savvy than paying for everything all at once.
Routinely assess your budget – Regularly look over your budget line items to make sure it still makes sense.
Don't stop planning for retirement – It's easy to want to give everything for your child, but it's also important to look out for your own future. Make sure you continue to set money aside for your retirement.
Growing your family creates added expenses, but with careful financial planning for children, everything works out beautifully. Let us help you create your plan today.