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How Much Do We Need to Save For a Baby?

How to Start a Baby Fund

Having a baby girl has been a wonderful blessing for us. As we’re settling into her 3rd month, we’re constantly surprised at how quickly she’s growing. Right now one of our favorite things is singing to her different songs and TV/movie themes to see what kind of reaction we’ll get. She’s an excited and happy baby so we have plenty of pictures and video of her smiling and laughing.

While she’s a great baby, like all little ones, she’s had a big impact on us, including our family’s finances. When we found out we were expecting, my husband and I decided that we were going to set aside some money to cover baby expenses.

I thought I’d share why we started saving for the baby, what it was designed to cover, and how much to set aside.

Why We Saved Up for the Baby

We’ve been comfortable with our emergency fund/savings in general, but we wanted to step it up. We’re now trying to be a bit more conservative -having a full six months of essential expenses tucked away makes us feel a bit more comfortable. Between diapers, baby gear, and unexpected baby expenses, we wanted some peace of mind knowing that we can cover these bills as they come.

Though we expect some expenses to go decrease (less eating out for example), we want to play it safe and assume in our estimates that we’ll see an overall increase as we get adjusted to being parents.

What Does the Baby Fund Needs to Cover?

What expenses can you expect? Every family is different, but here are some estimates based on what we’ve had and what our friends have shared:

Hospital Bill

While we were pregnant I asked friends, both with insurance and without, how much their hospital bill was for their babies. For those without, the bill was approximately $10,000-$12,000. For others, it was around a few thousand.

The bill we received from the hospital and our OB/GYN office was $2,500. Our insurance has a higher deductible than some people’s policies, so that’s how it worked out .

We were fortunate that my husband’s job reimbursed our expenses and we were able to get a good discount by paying our medical bills promptly. That saved us significant money.


Babies will go through more diapers that you’d expect. Even if you get diapers as gifts (wonderful idea- put that on the top of your baby registry!), you’ll still need quite a few.

The Bump has these estimates when it comes to diapers:

Newborn babies use an average of 75 diapers per week and up to 320 diapers per month. At about $.25 per diaper, that adds up over the year. Tack on two boxes of wipes per month ($3 each), and baby soap, lotion, powder, oil, and diaper rash ointment (about $14 month) and you have an additional $240 per year. Cloth diapers will save you money, if you plan to do the laundering, however using a diaper service costs about the same as disposable diapers.

Right now we’re using disposable diapers with our daughter. To save on diapers we’ve joined Amazon Mom  and with a diaper subscription, we’re saving 30%. For us, that means a box of 190+ diapers cost about $20 each month.

You may also want to consider getting cloth diapers. while there is an upfront cost, you can save some significant money using them on your little one.

baby fund

Planning ahead let’s you enjoy your bundle of joy more

It seems that there is quite a few options for parents when it comes to cloth diapers, with several ‘big’ brands to choose from like bumGeniusFuzziBunzHappy HeinysgDiapers,and Rumparooz.

By the way, you also want to add baby wipes with your estimates. You don’t need a wipe warmer, but a Diaper Genie is a good ‘extra’ item if you’re finicky about diapers.


Whether you breastfeed or formula feed, please make sure you’re taking care of yourself and eating well. Having a baby keeps you on your toes and you’ll need to be as healthy as you can be.

As for formula, Baby Center estimates that it will cost about $105 a month. Adding solid food for your baby later on will add just a bit more to your monthly grocery bill.

Baby Gear

Babies are wonderful people – it doesn’t take much to keep them safe and happy. If you haven’t received certain things from your registry, hold off on buying them until you need to. You may find you don’t have to buy as much as people think or a friend might have what you need.

For example, some babies are fans of bouncers and others can’t stand them. My daughter received a beautiful baby swing from a friend whose son didn’t like it at all. It’s like new and my daughter absolutely love it.


This varies greatly depending on your choice on type of childcare (stay at home parent, nanny, daycare, etc) and the area you live in. For my estimates I used BabyCenter’s Baby Cost Calculator:

  • Daycare (Moderate): $768/month
  • Home Daycare: $568/month
  • Nanny (Moderate): $2,600

If you decide to go the stay at home parent route, please sit down and see how it will affect the family’s entire financial picture.

How We Saved for Our Baby Fund

For us automated savings was the main strategy. Whenever we got a windfall such as a tax refund or bonus from work, having an automated deposit or transfer has helped us stay on course.

While we have created some sub-savings accounts at Capital One 360 for specific goals, we decided to keep this in the general savings account.

Thoughts on Savings for a Baby

Whether or not you start a baby fund separate from other savings, the important take away is having savings can help you ease one of the biggest changes in your lives.

For those readers who have been through this before and/or are going through this right now, I’d love to hear your stories. How much did you save for your baby and how did you do it?


by Elle Martinez

Elle Martinez helps families at Couple Money achieve financial freedom by sharing tips for reducing debt, increase income, and building net worth. Learn how to live on one income and have fun with the second..

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  1. That’s quite a bit of cash needed! my fiancee and I started a baby fund quite a while ago and while it’s growing fast, it’s not quite at the level you suggest. More work to be done, I guess.

    1. I wanted to give a ballpark figure about baby costs that way each family can decide how they’re going to save for it.

      For some families, the monthly breakdown isn’t a strain on their finances, so they may just save up for the hospital bill.

      However, other families may make the transition and have one parent become stay at home to raise the baby. For that situation, they may want to build a bigger buffer. If you can save up for diapers for the whole, then go for it.

      If you end up spending less than you saved, you can use the money for other financial goals. It’s a bout flexibility.

  2. We had our children a long time ago. My children were covered 100%. My wife changed her hours (part time) so she could take care of them except for 2 hours a week. She worked mostly Saturday and a couple of evenings. I adjusted my hours a little bit to keep the hours down.

  3. Keep in mind that if you really want to have kids – at some point, you have to take a “Damn the Torpedoes, Full Speed Ahead” (to paraphrase a historic sentiment) approach. All the analysis in the world shouldn’t prevent you from jumping in with both feet and starting a family. Our now 2-year-old and her soon-to-arrive sibling weren’t exactly, ahem – “planned”. But, we couldn’t be more thrilled. We keep a budget and track our funds, yes – but we realize that some areas of life, especially where kids are concerned – require a bit of faith.

    1. You have a point TYB. I’ve read a few articles lately pointing out how some families are putting off children because they’re so expensive. I wanted to encourage parents to be to have a savings plan to help them ease into the transition.

      Having kids should be a joy; if we can at least get finances under control just a bit I think that’s a good thing.

  4. “Babies are wonderful people – it doesn’t take much to keep them safe and happy.”

    So true. It doesn’t have to change that much as they get older, either, but that involves a little bit of training.

  5. Great blog. Could you describe why your husband’s job covered your hospital expenses for the birth, is that a common thing? Thanks

  6. High deductible plans excluded, if you’re covered by insurance I don’t see why you’d pay anything for the delivery. We just had our first in November and the entire hospital stay was covered.

    1. My husband’s job had a high deductible plan last year. They’ll reimburse part of it, so we saved up for the bill. By paying it off early, we got an additional discount. After the reimbursement, the total paid to the hospital was small.