I know this may come as a shock to some of you, but kids can be expensive! Some surveys (apparently written by people who buy their kids EVERYTHING) tell you it costs $11,000 per year to raise a child. Unless you have a child with LOTS of special needs, I just can’t understand that. Anyway, that’s not what this article is about – since we’re expecting baby number 2, I want to piggyback off of an article Stacy recently published about how to be ready to take home a baby from the hospital without having payments in tow. She gave many good points (a few I’ll reiterate) and there’s a few I want to put out there as well. Two things let’s get out of the way first: 1) having a baby is NOT a financial emergency. Unless I’m missing something, you’ve got at least a few months to plan for things. 2) having a baby IS something you can plan for (financially) and should. Trust me, you’ll already have enough “stuff” to haul around with a new baby. It is amazing the quantity of stuff out there you use to care for something so little! Let’s not add a payment book to it too. So how do you plan for that baby’s impact on your pocketbook? Here are 5 tips:
- If you have insurance or something similar that provides maternity benefits, check what coverage you have. This means making a phone call or two and finding out your maternity benefits and your maximum out of pocket.
- Ask questions. Whether or not you have maternity benefits, talk to the hospital or birthing center you plan to use and get their rates and payment options. Talk to your OB doctor and be up-front about what you intend to do. They’ll think it is a little weird that you’re an all-cash baby-buyer, but they’ll appreciate you as well. This also means asking in advance if there are ways to save money along the way or if there are charges you can avoid. Hint: there almost always are ways to save some money if you ask and plan in advance.
- Since you should have a fair idea of when your deadline is, do the math. It’s likely you have at least 7-8 months to plan once you learn you’re pregnant, so if you’ve done steps 1 and/or 2, you should know what your cost will be and can do some simple division. If you find out your expected cost for baby’s birth is about $1,500 and your maximum out of pocket with insurance is $5,000 per year, you’ve got some immediate goals. Assuming you have 7 months before baby arrives, that means your minimum savings amount should be $215 per month ($1,500/7) and your ultimate savings goal should be about $715 per month ($5,000/7). Yes, that is a HUGE amount to save each month, but that’s why it is a GOAL. With Annie, we spent about $1,700 total because there were no major issues. Scrape together whatever you can.
- Be ready to make a phone call when the bill comes. With Annie, we saved an immediate 20% on our final bill (in other words, we saved a few hundred dollars) by simply calling and asking for a discount when we were ready to pay the bill.
- Don’t assume you need every toy, gadget and other THING to bring home baby. You need a car seat, a few blankets and some diapers, as well as a LOT of love, patience and energy. Everything else is icing on the cake.
Having a baby is a wonderful blessing. Having payments on baby is not. Just like any other big expense that may come your way, PLAN. If God is granting you the blessing of a new baby, set a wonderful example of how weird you can be and pay cash for baby!