Smart Tips to Financially Prepare for Your New Baby


Welcome to the most rewarding and memorable journey of your life. Exciting times lie ahead. But is the exhilaration getting heavily punctuated with nervousness? As difficult as it may be to admit, a part of the anxiety is likely to stem from the financial impact that the newborn is bound to have on your lifestyle and your larger life plan.

After all, a baby is bound to bring along all sorts of surprises. Yes, now is the time to reduce debt, make practical, unemotional decisions about expenditure, and build your savings. Here are some of the smart tips to financially prepare for your new baby.

Account For Those Unpaid Leaves

Sure, you have your paid maternity leave, and paternity leave is becoming common too. But you may want that little extra rest pre-delivery, and more quality time with your newborn post-delivery, in which case, the stipulated paid maternity leave just won’t be enough. Paid maternity leave in India, as per the law, is up to 12 weeks (6 weeks before the due date and 6 weeks after the delivery). The rules that private companies follow may vary. While this is not an expense, you have to factor in the loss of income that extending your leave will result in.

Plan For Antenatal Care And Hospital Expenses

Visits to the doctor, iron and calcium tablets, a better diet, maternity wear all add up to a reasonable amount. Depending on the hospital you choose for the big day, the total bill across all nine months could run up to 2 lakh, and more if the mother or the baby develops any complications during pregnancy, birthing or later. If you have planned for a C-section, expenses will be more than double. Hence, it is best to find out and take into account the approximate cost of delivery as well as post-delivery from your choice of hospital well in advance.

Pay off Debts

A new member in the family demands a new structure of expenditure. Hence, it is advisable that you plan carefully around the baby’s needs before applying for new loans, making investments, or planning for that big, fat dream holiday. It would be a good idea to pay off as many of your existing debts as possible, before the baby lands in your arms. While it might seem like a strain right now, it will certainly be quite a relief in the years to come.

Shop Smart

You don’t really need all the cute things you see at all the shops of the world. No really, you don’t. A good rule would be to buy every fifth thing you find irresistibly cute. You must learn to resist the first four. This will also ensure that you are not stuck with clutter later, because, like it or not, you are going to get loads of clothes, shoes, toys, and even baby toiletries as gifts. As heartbreaking as it is, it would be a much smarter strategy to hold on to your shopping until the gifts have all come in. Also, it’s not a bad idea to share your need list with close friends and family who are likely to get you expensive gifts.

Consider Buying a Bigger Car Now

It is amazing how a little person, all of 5 kilos, can command a disproportionate amount of space in the car with his car seat, carrycot, and what not. So if you think you need a bigger car, take care of that expense before the baby’s arrival. Even try installing an infant car seat which can hold up to 35-40 pounds and fits babies snugly during the first year or so.

Remember That Childcare is Not Cheap

Going by the current trend of mother-toddler groups, this expense may start around the time your baby turns 10 months old. And it is quite an expense indeed! Reputed mom-toddler groups, and even pre-nurseries in metros, charge anything from 4,000 (INR) to 15,000(INR) a month. This expense might chime in a little earlier if you decide to go back to work sooner. If you are working, there will also be an additional expense of daycare and extra domestic help.

Be Ready For Contingencies

When accounting for expenses, it’s all right to overestimate or add an extra amount for emergencies. Even in the worst-case scenario, you may end up spending only what you budgeted for. If not, what can be better than extra savings! Bringing a new life into this world is a big decision. Keeping your finances in control will help ring in the change with a smile.