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Today's guest post covers a familiar topic here on Couple Money – the cost of having a kid.
The more I look at it, the more it seems as if kids can be as expensive or as frugal as you imagine.
Many parents say that nothing will prepare you for a new baby. However, there are a few things you can do to prepare – particularly where finances are concerned.
Get a Snapshot of Your Family's Finances
One of the first things on the list is to take a closer look at your finances. How are you two doing? Do you have anything that needs to be handled financially?
Sounds simple, but it's very common to be stressed out without getting the whole picture.
One of the best (and easiest!) ways to get a handle of your money is using an app or service to pull that data for you.
If you haven’t already done so, it’s time to do some insurance planning.
This money is useful in the event of something happening to you or your partner, even if it’s a bit morbid to think about.
It can be used to clear debts, cover mortgage payments, funeral bills, and disability care. Check the plans at MoneySupermarket to see the options that are available.
Childcare Options That Work For You
There’s a high likelihood that either you or your partner will want to stay at home with the baby, which will affect your monthly budget.
Research childcare options, searching for those that won’t break the bank, and apply for waiting lists.
Don’t despair if this seems like a high expense as there are many options available including day care centers, home care providers, crèches and even tag team parenting.
Have a Baby Budget
Keep tabs on money coming into and out of the household, and factor in costs such as nappies, formula, clothing and other expenses.
Start saving now rather than later for your baby's arrival.
One of the best things you can do is to a test run where you two live on one income for about 6-9 months.
This can help you develop a habit of living on less than what earn. that gap will be crucial.
If you decide to continue working, you've built a buffer to help with childcare and other baby expenses.
If one of you decides to cut back and/or stay at home with your kid, your budget has something breathing room.
Even if you plan on having your baby years down the road, getting into the grove of living on one income gives you two options. a win-win in my book.
Thoughts on Saving for Baby
If you haven’t already started saving money, it’s important to pay off debts now, tighten the household budget and ensure there’s room in your finances for your bundle of joy.