How to Financially Prepare When You’re Expecting
Preparing for a baby should be nothing but exciting times for you and your family. We understand, however, that you might be worried about how your finances are going to change. Like you might expect, you’re going to have to take a few steps in preparation so you can be in the right financial spot once he or she arrives. Here are 6 tips so you can be financially prepared for the big day.
It is safe to say that as your baby grows, so do your finances. In order to prepare yourself for these new expenses, it is helpful if you pay off what you can before your baby arrives. Whether it’s the car you still have monthly payments for or your phone bill, knocking down some of your monthly bills can help relieve some stress when new bills start to come in.
2. Use a budgeting app
Anyone who uses a budgeting app will tell you it works wonders. Our personal financial tools are designed to help you plan for anything, including adding a new member to the family. Once you add in your personal finances, the app will give you guidelines on how to start budgeting efficiently. This way you can take on the new bills without the stress of not knowing where to start.
3. Use your resources
Everyone has more free resources available to them than they realize. Make sure you think outside of the box when it comes to preparing for your new baby. Did your friend or relative recently have a baby of their own? Reaching out to see if there are any hand-me downs that you can get extra use out of is a smart way to save more money. Obviously, there will be items you can’t borrow, and some you want to pick out, especially for your new kid, but having a mindset that you don’t need all brand new toys and clothes for your new born can be financially beneficial.
4. Start an emergency fund
If you haven’t already, start an emergency fund as soon as possible. Now that you have a baby in the picture, being prepared becomes that much more important. You can start adding to your fund weekly by taking a portion of your direct deposit and dropping that right into the savings account. The hardest, but most important part, is only taking money out of this fund when you come across an emergency. Open a separate savings account to plan for childcare and vacations.
5. Know where to put cash gifts
Luckily, most friends and families understand how difficult it might be financially when you have your first baby. At baby showers or birthdays, you may be receiving more cash presents than you are used to, so it is important you know what to do with it. Starting to put that money into an education savings plan like a 529 plan, can allow you to save for your baby’s future in a tax-free account.
6. Make necessary adjustments
The day has come and you finally get to meet your new baby! As exciting as it must be for your whole family, there are a few necessary adjustments you need to make before you forget. You’ll have 30 days after your baby’s arrival to enroll him or her into your health plan. Also, beginning to plan for your child’s care whether it’s a nanny or day care will help your eventual transition back to work that much smoother.
Make sure you are taking advantage of your Rewards debit card when you are shopping for your baby. Earn unlimited 1.00% cash back on online & in-store signature-based (“credit”) purchases. Plus, earn an additional 0.5% cash back on select spending categories now through December 30, 2020.