How to Budget for a New Baby

The arrival of a new baby means a lot of changes for a family, and in so many ways. The biggest change will be in your finances and specifically your daily expenses, but to what extent will be dependent on a number of factors. Among the many preparations you need to make, you will have to take the time to budget for a new baby in order to ensure that the addition does not hinder your financial situation. Consider some proven steps when establishing your new financial plan.

Steps

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    Get a visual picture of your current finances by listing your income and expenditures. Include all your debts, bills, and expenses. A clear picture of what you get and spend will allow you to decipher where you can cut back and whether you can afford adding a baby budget to your current financial status.
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    Shop around for better insurance coverage for your home and vehicles. Insurance companies raise their rates constantly, so shop around and see what others are offering. You may be surprised how much you can save by making a habit out of shopping around. Do the same for cable, phone, and Internet, if the option is there, and think about signing up for a budget plan with some of your utility companies.
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    Practice frugality for one month in order to establish a feasible baby budget. This will help you get a realistic idea of what you can save. By doing this you can better determine whether you are able to cover the additional expenses easily, or if you need to take on a second job or cut back more drastically.
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    Determine how much you have to set aside for baby's one time purchases. There are things that you will need to buy just once, such as nursery furniture and crib set, bath and bath items, swing set, and stroller. If this is your first baby, you will need to start from scratch; but consider purchasing neutral colors and unisex designs if you plan on having more children and you want to reuse everything. Don't purchase all these item, just cost out how much to budget, and then add everything to your registry and pray your friends and family will purchase the bulk of your needs.
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    Budget baby costs by including ongoing baby expenses, such as food, clothing, and daycare. If you choose to breastfeed, then you may have to invest in a breast pump and bottles. You may want to consider this when you factor in the high cost of formula.
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    Find ways in which you can save money. For example, see if you have baby consignment stores in the area. Baby clothes are always relatively new because babies grow out of them so quickly. You can also look online on websites such as eBay where you can purchase inexpensive items or purchase clearance clothes for seasons to come. Becoming a coupon guru is always a smart way to save money on both food and clothing items.
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    Determine who has the better medical insurance at work to cover the family. The cost of insurance is another factor that needs to be included in your budget for baby. You may have to switch from one to the other if it makes more sense to do so.

Article Info

Categories: Pregnancy