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The decision to add a child to your family may be the biggest decision—and the biggest change—you and your significant other ever make. It’s a commitment and a major responsibility to raise another human being but comes with many rewarding moments. It also comes with a steep price tag. Before planning to expand the family, make sure the following expenses have been considered.
Cost Of Healthcare And Insurance
With frequent doctor visits and ultrasounds, pregnancy and delivery are expensive, even if you do have health insurance. Make sure you understand the details of your insurance plan and talk to your doctors about the bills you can expect to incur. By planning ahead, you’ll be able to navigate the payments with a lot less stress.
Details Of Your Estate And Beneficiary Plan
Once you bring your bundle of joy home from the hospital, the last thing you want to do is meet with a lawyer to plan your will. During your pregnancy, tackle the hard stuff and set up a will, other estate documents, and identify a guardianship plan. In addition, talk with Human Resources at your company and find out more about additional life insurance policies they offer.
Finances During Maternity And Paternity Leave
The law indicates that companies must give 12 weeks of leave to mothers after giving birth, but they aren’t required to pay them. As a best practice, most companies will compensate up to 60% of your salary, and some states offer paid time off even if your employer does not. Even with the financial help, you still have to budget for having less income than normal during this period.
Paying For Child Care
Daycare expenses are on the rise— sometimes costing more than a mortgage! They also fill up quickly. Make sure to research the best and most affordable options in your area early in the pregnancy. A great benefit to take advantage of is a flexible spending account, which allows you to allocate pre-tax income to expenses like child care.
Thinking Ahead To Your Child’s Future
Although this financial factor isn’t urgent, it’s important to consider and discuss with your partner. The earlier you save, the less you’ll have to worry about it when they turn 18. As soon as a child is born, you also have the option of opening a 529 plan, or a plan to help save for college with pre-tax income.