Financial Planning Before Getting Pregnant: Are You Ready For a Baby?
Planning to have a baby is an overall a joyful and exciting experience. However, during the process of getting pregnant, some realistic and worrisome concerns may creep up and cause some anxiety for future parents. If you are concerned about financial planning, and whether or not you are financially ready to support a baby, you may want to take some things into consideration prior to pregnancy. How will your current financial situation change with the cost of having a baby? What type of financial information, investment, and budgeting plans should you take into account before getting pregnant? Some of these parenting tips will help you decide if you are financially prepared for a child, and help you consider some of the necessary measures to take in your budget planning in order to prevent future financial trouble.
Reduced Income and Maternity Leave
The first thing you need to consider while attempting to get pregnant is whether or not your family income will be reduced during or after pregnancy. Check with your financial employer to see if you’re covered by short-term disability insurance, which can cover pregnancy leave. Be sure to understand what your company’s maternity leave policy is for both parents, and how that will affect your overall income. Consider whether or not you will be returning to work or staying at home once your baby is born.
Medical Health Insurance
Check to see if your health insurance plan will cover your prenatal and post-pregnancy costs, as well as your newborn health needs. Consider whether your health insurance plan covers prenatal care and testing. What types of delivery options does it cover, and does it include the cost of emergency c-sections and anesthesia? Are medical visits before pregnancy covered, and will your newborn’s doctor visits be included?
Find out if there are any deductibles, and whether the costs of a nursery will be covered. You may want to consider switching health insurance plans if you find that the cost will be too high for you during pregnancy. If you are already pregnant and decide to switch medical plans, make sure your new insurance plan covers the cost of pre-existing conditions.
Lastly, if the company you work for does not offer health insurance, check the children’s health insurance program in your area which will usually provide low-fee coverage for moms and newborns during and after pregnancy.
Life and Disability Insurance
It is recommended that new parents look to investing in life insurance and long-term disability insurance, for both working and stay-at-home parents. This is to insure that your child and family are taken care of in the event that something happens to you.
The cheapest form of life insurance is term life insurance that guarantees you a given amount for a certain premium. Long-term disability insurance may be offered by your employer, so check to see the coverage policy and make sure that it is right for you. Speak to a financial advisor who can guide you to make appropriate financial investments.
Family Financial Planning: Family Budget and Personal Budgeting
Make a list of your current monthly expenses and compare them to your monthly income to help you with financial management. Consider the changes that will be made to your income as well as your cost of living with the arrival of a baby. The cost of raising a child in the United States is overall greater than investing in a home, so make a personal and family budget and try to set a bit of money aside every month for your baby.
Saving for your child’s education is important, and there are many options available for you that can give you an idea of how these savings will affect your income. Many experts warn that while a baby’s costs may be a parent’s primary financial concern, it is important not to sacrifice your own personal funds, such as your retirement fund, to ensure that your future is taken care of as well.
The most important step in the budgeting process as you prepare for pregnancy is to reduce your daily expenses where sacrifices can be made. If you know that you or your partner will be on unpaid maternity leave, or will not be receiving a regular income, you may want to get into the habit of living on a lower income even prior to pregnancy.
Make smart purchases on a regular basis where you can, and avoid unnecessary spending when possible. Remember that the benefits and joys of a secure family will always outweigh any lavish purchases. You may have to consider making other sacrifices, such as moving to a smaller home. Consider your options and review them with a financial planner. These steps will help you to make the best decisions where you can to put you and your partner at ease before your baby’s arrival.
It is recommended that new parents look into life insurance leads
and long-term disability insurance, for both working and stay-at-home parents. This is to insure that your child and family are taken care of in the event that something happens to you.