Think first, buy later
When you first learn you’re pregnant, it’s easy to get carried away. Everything is so cute and tiny and new that you find yourself wanting to buy everything in sight. Erica Sandberg, a money and credit management authority, reminds us that this isn’t such a good idea; you always need to take time to weigh the needs against the wants. “Keep your emotions and desires in check. You don’t know how it’s going to be when the baby gets here, so scale back now.”
This is good advice, especially considering the amount of baby gear you’ll be getting from friends and family throughout your pregnancy. “You’re going to want time off with your child, so make every effort during your pregnancy to put money away, and wait for gifts so you don’t end up with duplicates,” says Sandberg.
Also, don’t be afraid to ask for specific items from family and friends. Dr. Lewis J. Altfest, finance professor at Pace University’s Lubin School of Business, notes that the best time to save money is during pregnancy. “Ask for useful gifts from friends and family to cut your start-up costs,” he advises. Tiny infant apparel is nothing short of adorable, but face it—your baby is going to be outgrowing all of those cute newborn outfits in no time. You’re better off asking for necessities like baby wipes, diapers and burp cloths.
Build a budget
When you break it down, the cost of living can be mind-boggling. Add another little body into the mix and you’ll realize that your expenses increase significantly—childcare, housing, food and healthcare costs are all going to go way up.
The best way to feel out your new financial situation is to create a budget. Budgets seem like scary, tedious and time-consuming things to most people, but don’t be afraid. “It doesn’t take anything but organization and a good tool,” says Sandberg.
Actually, the scariest thing is not keeping track of your spending habits. Using the U.S. Department of Agriculture’s statistics, Altfest found that a household with an average yearly income of $60,000 spends $10,600 of their after-tax earnings on raising their infant. That’s 22 percent!
With that kind of money going into child-rearing, it’s a good idea to prioritize your spending. Categorize spending and savings by importance, and remember, sometimes cutting back isn’t always the best idea. “Health insurance is something you can’t skimp on—it’s even more important than diapers!” Sandberg goes on to say that another vital budget inclusion is a little extra for sanity time. “Budget for a date night. To maintain a good relationship with your partner, you have to put a lot of time into it.”