Thursday, 7 May 2015

You just found out that you're pregnant—congratulations! But now that you've looked at your bank account, you're getting a little nervous.

Babies can be mighty pricey; middle-income families spend an average of almost $13,000 during a child's first year of life, according to a 2013 USDA report. But fear not. You have nearly 10 months to prepare for the arrival of your little bundle of joy (and the expenses that he or she will bring). Take note of the following budget calendar to help stay on track until the baby comes.

Months 1-2

Make a budget
Sit down and determine the amount of money you and your partner will need to spend every month. These fixed costs include your rent or mortgage, utilities, transportation costs, and any mandatory medical expenses. Then look at the variable costs you incur on a regular basis, which might include gym memberships, dining out, entertainment, and non-mandatory travel.

Think about what you can cut back on, but be realistic about it. If going to one movie per month makes you a happier person, budget that in. The goal is to cut out impulse purchases. Once you have a handle on your spending, create savings goals that make sense to you. For example, try to dedicate a certain amount to a baby fund and a general savings fund. Save up to at least 20 percent of your net income, if you can.

Worried you won't be able to do it? Discipline yourself by using direct deposit; you won't even notice what you're missing.

Tackle your debts
If you want to try tackling all your debts at once, you may decide to take charge by rolling outstanding debts onto a credit card with a much lower rate. Try paying off cards within promotional, no-interest periods. Or talk to a banker about how to consolidate your debt payments—you may even consider borrowing against your home for lower interest loans.

Months 3-4

Start saving for you
It may seem counter-intuitive, but saving for you and your partner is really important. That way, when you are in need of a spa treatment or a night out, you'll have money to draw from. This can help prevent impulse purchases, and save you money in the long run.

Review your insurance
Evaluate your health insurance plan and talk to your doctor. Heather Hatfield, a writer for WebMD, recommends asking your physician how many visits you can expect in the first year, including sick visits. Then, multiply that number by your insurance co-pay amount. This will give you a good idea of just how much you might spend on your medical bills.

Months 5-6

Start researching the will-writing process
It's probably the last thing on your mind, but it's important to have your will, power of attorney and estate planning documents be in order once the baby comes. According to Pregnancy.org, lawyer fees can range from $250-$1,200 to finalize these documents, so it pays to initiate the process on your own. USA.gov is a good place to start, as it offers several free resources on estate planning.

Try living on one income for a month
This can be a good measure of how much time you can really take off. Do you or your partner make enough for you to take leave for two months? Six months? A year? A trial run of this concept can help you financially plan for the long run. At the same time, saving the difference can help jump-start your savings for when the baby comes.

Months 7-9 (and 10)

Buy less than you think you need
Babies don't need the finest cribs, brand-name blankets and rhinestone-encrusted photo frames. Fight the urge to go overboard and plan to buy things as you need them instead. Infants only need a bassinet, so try holding off on the crib until the baby can roll over. There's also no need to buy hundreds of diapers right off the bat. Purchase one package of infant diapers and go from there.

Note: Do not skimp on a car seat. Buy a brand new one (read: not from a consignment store) and make sure the technology is up-to-date. Check out these requirements and purchase one pre-delivery; most hospitals will forbid you from leaving until they've checked your car for the proper seat.

Buy second-hand or borrow
Call up friends or family members who have children and ask to borrow clothes. Or go to consignment stores for the latest trends. Services like Once Upon A ChildConsignment Mommies and threadUP can help.

 

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