Having a baby is an exciting milestone that will change your life forever. Make sure that you are prepared for the changes that will happen when the baby arrives. One of the many aspects that you can look into even before giving birth is your budget and savings plan.
Why is it important to save money for the baby? You need a plan that will make room for all the new expenses upon the baby’s arrival. From buying all sorts of baby supplies to medical bills, there seems to be an endless list of baby-related costs. Without planning for these changes, you may end up being surprised about the impact on your budget.
So how can you plan for the changes having a baby will have on your savings plan? Here are several ways to save up for baby:
Assess your current financial situation.
Know where you stand as far as income, savings, and expenses are concerned. Re-evaluate your goals and set priorities. This is also the time to think about what you are going to do when the baby arrives. It is possible that you or your partner will stop working for a few months or go part-time. Any of the options will affect your income so take it into account.
Pay off your debts.
Even if you know how much money to save before baby arrives, your savings plan will be affected if you still have debts. Look for ways to reduce your debt levels. Make advance parenting payments on your personal loans, mortgages, and/or credit cards. Delay any major purchases to avoid adding up to your existing debts. Transfer your balances to a credit card that offers lower interest rates. With debts out of the way, you can focus on saving money for baby. You will be able to allot more cash to your savings plan and do it on a regular basis.
Establish a baby fund.
As early as possible, start saving so you can have money for the coming months when expenses will dramatically increase. Have a separate savings account and set up direct debit from you and your partner’s bank accounts months before the baby arrives.
Go easy on buying baby stuff.
Don’t get carried away with all those cute and wonderful baby essentials. Make a list of things that the baby needs and buy the most important ones first. For items such as prams and cots that will be used for a limited time, you don’t have to buy new ones. Consider looking at second hand stores. Your friends may also have hand-me-downs that you can still use.
Don’t let financial struggles get in the way of the fun and excitement of having a baby. So make sure to plan for the changes. Keep these tips to save money for the baby. In this exciting milestone, it is good to know that your finances can be one less thing to worry about.
Do you know other ways to save up for baby? Help other parents out there by sharing your tips in the comment section below.