Expecting a baby can be one of the most exciting times in your life and so it should be. However, as cute and life-fulfilling as newborn bubs can be, they also come with a price tag. Nothing in this life is for free, right? So, if you have just found out that you are carrying the (rather expensive) gift of life and you’re, well, completely freaking out, we’re here to help!
We know that 9 months may seem like a pretty decent amount of time to sort things out. However, many women don’t find out they are pregnant until about 6 weeks in, so take a month and a half off your prep time. That’s 7.5 months to plan, save, possibly move house, and make a solid plan for your future. If you weren’t freaked out before, you might be now… sorry!
However, we have put together some Nifty tips for getting yourself ready for the arrival of your little one. We’re even going to look at how baby loans might help you! After all, you can never be too prepared to introduce another human being in the world and raise it to the best of your ability, right?
As we are a finance company, we figured we would stick to what we know best… finances. So, we’re going to help you navigate the murky waters of financial baby prep! Forget your baby brain, here’s some of what you need to know about baby loans and budgeting.
So, What To Expect (With Your Finances) When You Are Expecting
You know, many people are lucky in that they get financial support from their family, friends and baby showers. This helps to accumulate the big one-off expenses like furniture, newborn clothes and other baby equipment. This might help to ease some of the financial burdens, however, the ongoing cost of a baby can be quite eye-watering. Endless nappies, food, toys, childcare, wine (for the parents, of course). It all adds up and takes a fairly large chunk out of the ongoing budget. Basically, you need to be ready to make some sacrifices.
So, what is the biggest thing to expect, budget-wise? Well, it’s really just the way your budget will adapt to accommodate new needs that replace your previous ways of spending.
There are a few questions and conversations you need to have with your partner or co-parent when you’re expecting a baby and planning financially for your new family. This is a pretty important conversation that all expectant parents need to have: how is your life going to look once the baby is here?
Here are some key questions that will help you figure this out:
- Who will work?
- Who will look after the baby?
- Are you going to use childcare? And when or what age will you want to put the baby into childcare?
- Will grandparents or other family or friends be available for care if you go back to work?
What Are Some Of The Hidden Costs Of Having A Baby?
We all know the normal costs that come with bring life into the earth: hospital bills, midwife, clothes, nappies, food, and the list goes on. But sometimes it can be good to look at the surprise costs that not everyone tells you about. Some of these include:
- If your birth doesn’t go to plan
- Higher utility bills
- Convenience food (microwave meals and Uber Eats)
- Health care
- Loss of income
- A bigger house
- A larger car
- Life insurance
- All the cute things
- Replacing things that the baby wrecks
… just to list a few. However, while these all seem like things you need to be stressed about, they’re not. Basically, we feel that parenthood is just something you figure out and the money side of things comes with that. It never hurts to be organised though, so let’s look at how you can do just that!
Baby Loans and Budgeting
Budgeting when you are expecting a baby can be tricky as quite often you don’t know how much things are going to cost you per week etc.
However, we always say there is no time like the present, so start your baby budgeting as soon as possible! Now might be a great time to hit the supermarket and find out how much a box of nappies and formula costs and how often you will need to buy these. Perhaps chat with some friends or family members who have kids to get an idea of how much to buy at a time (you can never have enough nappies) and where is best to buy bulk.
Some other questions to ask include:
- Are you going to delay big purchases like a house or a new car and consolidate and reduce your debt?
- Or do you need to purchase a home for your family for the foreseeable future?
These questions may seem overwhelming now but you will be glad you planned ahead once you put everything into action!
However, if you are really stressing and you’re not able to find comfort in the budget you have planned, you have options! Like a baby loan!
What Are Baby Loans?
Essentially, a baby loan is a personal loan that you take out in order to cover the costs of your little bubba. It could be to cover your doctor appointments, midwife fees, your nappy or formula supply, your cot and nursery supplies, or just to support your primary income for a little while. A loan can be a great way to get that extra comfort that your budget alone is not providing. You may even want to look into applying for a personal loan for maternity leave, just to get you through. The newborn stage of parenthood is difficult and tiresome enough without the added pressure of financial stress. Therefore baby loans can act as your saving grace!
Some benefits of applying for a personal loan while on maternity leave, or general loans for expecting Mothers include:
- Extra cash flow to get you through a stressful time
- Peace of mind that your expenses can be taken care of
- More time to focus on your new baby
- Some breathing room when it comes to establishing a suitable budget after your baby comes
However, baby loans do not suit everyone and you definitely don’t want to put your family in financial strife down the track when it comes to paying off your loan. At the end of the day, it’s up to you to decide whether getting a loan on maternity leave is going to suit your individual situation!
What If Baby Loans Aren’t For Me?
That’s ok! As we said, loans for pregnant mums are not going to suit every pregnant mum. Luckily, there are so many other ways for you to get your finances ready for your little bundle of joy!
One option is to just be really careful and strict with your budget. Some ways to prepare your financial life for what’s to come includes:
Setting Up Automatic Savings
If you’re not generally very proactive when it comes to saving your coin, now is a good time to start! A great way to prepare for increased expenses is to make regular contributions to a savings account, specifically dedicated to your baby-related expenses. You might want to plan this in line with your pay cycle. So, if you get paid weekly, maybe you want to put money away weekly, or if you get paid fortnightly, that might work better for you. Or you could just commit to contributing a lump sum every month… whatever works for you and your family’s income! Oh, and you may want to set this up as an automatic transfer, just to discourage any erratic purchases.
Create A Reverse Budget
Just like many aspects of your life, your finance can get a little more complicated once you bring kids into the mix. You’ll also have less time and energy to keep track of things. Now, we know we’re not really selling the whole parenthood thing here, but it’s really not a stressful and tiresome as we have made it out to be. One great way to combat your potential money troubles is to focus on how much you need to save and then planning your spending, rather than looking out how much you need to spend and looking at your savings thereafter.
Another option is to look at getting some help from the Government…
Government Baby Loans
If you think you’re going to need some kind of financial help, you can always turn to the Department of Human Services. They offer 18 weeks paid maternity leave for new mums who are not eligible for maternity leave through their workplace. Generally, this is paid at minimum wage, but every little bit helps! Alternatively, you might be eligible for one of the payments that the government offer new parents. These include:
- Parental Leave pay – helps eligible working parents take time off work to care for their newborn baby
- Dad and Partner Pay – give eligible dads and partners up to two weeks off work with a newborn child
- Family Tax Benefit (FTB) – a two-part payment to help with the cost of raising your children. This may include a one-off lump sum of Newborn Upfront Payment or a Newborn Supplement which is an increase to your FTB for 13 weeks.
- Parenting Payment – this is the main income support payment while you’re the main carer for a young child.
For more information on the different payments you might be eligible for, check out the Department of Human Services website.
What If I Am a Single Parent & Expecting a Baby?
If you are a single parent and expecting a baby, your planning doesn’t really need to change. You’ll still want to budget carefully and save as much as possibly can, you can still consider baby loans, or be eligible for government support. Some other things to consider with you are a single parent-to-be include:
- Do you have family support?
- Is there a program you can enrol in where you can be cared for? – Midwifery programs are an excellent place to start, they are usually free and you have a support group and midwife on call throughout your pregnancy and birth as well as care in your home for up to six weeks after the baby is born.
Ask your GP to refer you to a midwifery clinic the earlier the better as often these groups are in high demand and book up quickly (they start taking placements as early as 8-12 weeks pregnant).
What Else Should I Consider When Expecting a Baby?
Things you should consider and budget for while you are pregnant:
- Dr and hospital bills
- Are you going to a private or public hospital or do you plan to enrol in a midwife program?
- How much are scans and blood tests going to cost you?
- Purchasing maternity clothes and baby furniture.
- Extra savings for after the baby arrives.
Here are some other budgeting tips for your new family:
- Track your spending
- Always have a goal in mind
- Keep your budget simple
- Always know what’s coming in and what’s going out
- Practice downsizing
- Buy second-hand items
Overall, with the right planning and considerations, you can make the joy of expecting a baby exactly that: a joy! If you are an expectant parent, we congratulate you and wish you all the best! We hope these tips have helped you figure out your budgeting steps in the lead up to the arrival or your bub! If you have any questions regarding the information we have provided, or you have your own story to share, please get in touch.
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