Putting together this article of resources and tips on financially preparing for having a baby was one of the most requested blog posts from readers in 2020. I don’t know if it is the pandemic, that millennials are now aging into parenthood, or the fact that money is just a super timely topic at the moment, but several of you wanted this post to come together and I am more than happy to oblige.
Below, I’ve added in a bit about my own experience on how to financially prepare for having a baby, hyperlinked related articles where I could, and even sourced some great material from other places around the web so you don’t have to do the searching.
Get Ready for Baby With Health Insurance
I listed this one first because navigating health insurance to me was THE MOST SCARY aspect of financially planning for a baby.
Knowing how much it stressed me out, my husband graciously agreed that since I was doing the physical work of carrying and birthing our baby, his part would be navigating the insurance. And this was a big job — you go to your OB’s office 10+ times in a nine-month span. And you bet you get a bill after all of them.
Some insurance providers cover additional benefits like a lactation consultant or a night nurse, but again, you often have to read the fine print or interact with your insurer to understand all the details of your benefits.
Here are a few posts I found that really break down insurance basics, and then more specific pregnancy-related insurance questions.
- Medical Bills 101: From Pregnancy to Delivery
- All the questions you should ask your insurance company before you have a baby [VICE]
- How do I sign my baby up for health insurance [Bernard Benefits]
- 5 Things to Know About Health Insurance if You’re Planning for a Baby [Fool.com]
- How to pick the right policy when you are pregnant [PolicyGenius]
Max Out Your Health Savings Account
We had the added benefit of conceiving in one calendar year and delivering in another, which happens in most pregnancies. (Except for those of you who conceive in January and February, sorry brah!)
So, in order to sock away the most we could, we maxed out our health savings account (HSA) contribution in both 2019 and early 2020 in order to ensure we had enough to cover all of the related costs of the pregnancy.
Pro Tip: You’ll at minimum need to plan how you’ll pay your insurance deductible. Often, most parents will need to pay this before insurance will cover the remaining costs of labor and delivery. An HSA can help with this and more.
And the best part about HSAs is that they roll over, so if you’re planning for kids 1-2 years out, you can amp up contributions in preparation for starting a family.
HSA monies can also go toward fertility treatments.
- Planning for a Baby? How an HSA can help you save [Hsastore.com]
- Having a baby? Have an HSA first. [WageWorks]
- 7 Pregnancy Purchase You Can Use Your HSA For [Mom.com]
Planning Out Maternity Leave/ Time Off From Work
I wrote a post on how I saved up for my maternity leave as a self-employed freelancer here. Here are a few other articles I found really helpful. I especially zeroed in on resources for those of you working a corporate gig, or running a brick-and-mortar business outside of your home.
- Maternity Leave 101: Basics You Should Know [FairyGodBoss]
- How to Plan a Thorough and Flexible Maternity Leave [The Balance Careers]
- The Ultimate Maternity Leave Checklist [Mother.ly]
- Exactly How to Prepare for Your First Maternity Leave [Fast Company]
Financially Preparing for Baby Gear
In my experience, the amount of gear you need for a baby is the least overwhelming part of the financial prep, but yes, there are costs — extensive costs — to all of the things you’ll need for the baby.
Pro Tip: While babies need a lot of “stuff,” they need different things at different times depending on their development, so you don’t need everything all the big-box stores tell you right away. Here is my list of what to buy and what to skip, and another fantastic minimalist baby list from my friend Erica at The Worth Project.
I also put together a post on how I put together a sweet little nursery on a budget.
Prepare for Unexpected Costs
I did do a post on the six baby expenses I was most surprised by, but just like every baby is different, so is every pregnancy. There are just going to be expenses that will pop up, and maybe you’ve thought about/prepared for a handful of them and maybe you haven’t.
- Here were my biggest expenses as a new mom [Money.com]
- Budgeting for New Parents: How to Build a Baby Budget [Nerdwallet]
- The Ultimate First Year Baby Budget [WealthKeel]
How to Start Saving for College
Setting up a college savings account for your baby is a BONUS, not a requirement in the personal finance game of life. And you shouldn’t really contribute to your kid’s college fund if it is to the detriment of your own emergency savings, debt repayment, or retirement contributions.
With that said, if you’d like more information about setting up a college savings account for your kid, here are the articles I loved:
- Had a Baby? Consider a 529 Account [CreditKarma.com]
- Building a College Fund for a Newborn [Interest.com]
- College Savings Strategies for Your Child: Pros and Cons [Nerdwallet]
- Choosing the Right College Savings Account for Your Child [The Balance]
And one final tip from me: Whatever you can do to organize your finances before the birth of the baby is well worth it. Having nine months to prepare for a child’s arrival is a gift as there really is so much time to get everything together. Don’t squander such a gift by waiting until the last minute!