No one will argue that babies are not expensive. New parents can expect their monthly budgets to increase substantially, as much as $10,000 annually or more, according to Practical Money Skills for Life. Parents have some control over their budgets however. Advanced planning can help to keep costs down. Parents should take time to discuss their needs and wants, and make sure their priorities are in line with each other and with their income.
Step 1
Talk about your budget while you are still pregnant to avoid disagreements and overspending. Decide which items you can purchase used and what luxuries are important to you and your new baby. Talk about generic brands of food, diapers and other baby necessities, and which name brand products are non-negotiable.
Step 2
Make a list of your one-time expenses that you are sure you'll need, such as a car seat, crib and highchair. Keep the first list limited to absolute necessities you know you'll need. Start a second list with continuing expenses, such as food, formula and diapers. Add up the initial output.
Step 3
Add up the recurring expenses each week and multiply times 4.33 and then multiply that amount by 12 to come up with your annual budget needs. Add that figure to your current household budget. Take your annual income and divide that by 12. Compare the budget with your income to find out where you stand financially.
Step 4
Purchase as much as you can before the baby's birth so that you won't be stuck for large bills during the first 30 days the baby is home.
Step 5
Remove those items you thought were necessary and trim excess spending if your income is not sufficient to cover your expenses. Start a savings account so that you can build a rainy day fund for emergencies that are common with children if you have any extra money at the end of each month.
Tips and Warnings
- Take advantage of an online baby cost calculator designed by consultants who have already researched average costs and put together lists that include the most common items new parents must purchase as well as monthly ongoing needs.
- Don't buy too many clothes, blankets and other newborn necessities until after you've had a baby shower. Many guests will call and ask what you need or request a list from the party planner. The gifts may significantly help you during the first 30 to 90 days while you discover what items you're missing and must purchase yourself.
Things You'll Need
- List of expenses
- List of income
Member Comments