What You Need To Know When Budgeting For A Baby
Whether you are first-time parents or have gone through this process a time or two, having children is not a small financial decision. In fact, the average cost to raise a child born in 2015 was around $233,610. This would include many expenses, such as housing, food, childcare, clothing, medical, and more. If you are planning to grow your family, here are some financial considerations to keep in mind:
The Cost of Delivery. One of the biggest stand-alone costs happens before you even bring your child home. Checkups, labor/delivery, and hospital stays are not cheap endeavors. It’s important to know beforehand what you expect to pay out-of-pocket for your medical expenses.
The Cost of Essentials. If you’re a first-time parent, everything may feel “essential.” From food to accessories to safety appliances, figuring out what you classify as necessities, and what you can function without, can help you eliminate unnecessary expenses. As hard as it may be, don’t buy what you don’t need! Children quickly outgrow clothes, toys, etc., so avoiding excessive purchases can save you money for more important investments.
The Cost of Childcare. Whether it’s daycare or babysitting, the cost of childcare can be pricier than you may expect and is dependent on many factors, such as your child’s age and if care is needed on a part-time or full-time basis. If you know you are going to need childcare, start researching the cost in your area to get an idea of how much you’ll be expected to put aside per year.
Valley offers many great savings options to help you better prepare for your short and long-term goals, including our Stash Savings Account. With a Stash Savings Account, you can save for a specific financial goal or need while earning dividends on your balance. Visit our Personal Savings page to view all our savings options!
The Cost of Parental Leave. If you plan to take extended time off work or take on a stay-at-home role permanently, you’ll need to account for that loss of revenue. This can be a big adjustment if you are accustomed to living off a fixed income. Also, don’t forget about the additional impact of lost investments and benefits.
Having a baby is a very exciting time and an unparalleled event. Your required budget will grow and change with your child. What started out as diaper and baby monitor expenses will turn into sports fees and saving for college. Having an idea of what to expect throughout the years will help you enjoy all the moments in between. Valley is proud to offer resources and financial education opportunities to children throughout our community. Learn more here!