Every cloud has a silver lining, and it looks like COVID could be driving a baby boom. If that sounds like you, it’s time to get financially ready for parenthood.
Take weeks of lockdowns, add in months spent working from home, and what do you get? A baby boom! That’s exactly what plenty of experts are predicting for 2021, and if the patter of tiny feet is on your horizon, the time to start planning is now.
The arrival of a new family member throws plenty of new and often unexpected challenges at parents. We all rise to the occasion even if it can mean fumbling our way through the finer points of nappy changing. But one of the last things you need as you come to grips with the idea of being a parent is the additional strain over money matters. That’s why it pays to plan ahead.
Grow ‘baby’ savings
A good starting point is to build a pool of savings to help tide you over parental leave. If you’re part of a couple, aim to live on one income for a while – it can be a handy way to grow savings while giving you a taste of what may lie ahead.
When you’re growing savings, look for an account that offers a healthy ongoing interest rate.
Revise your budget
If you don’t already use a budget, now’s the time to start. Expectant parents can find themselves stressing over how they’ll pay for everything, and a budget can provide the answers.
Your lifestyle will likely change in the months approaching the baby’s birth – and beyond. Your budget should reflect this. For handy budgeting tips head to Ed, ME’s online school of money.
Know your entitlements
Conditions around parental leave become very relevant when a new baby is on the way. Talk to your employer, union or the Australian Unions Support Centre to know what you’re entitled to and start to make plans around leave. This can help finetune your baby budget.
Paying for it all
New parents can opt for all the bells and whistles – a new pram, the latest hi-tech baby monitor, and a designer label wardrobe for your pint-sized family member.
Remember though, your baby won’t know – or care – if you’ve purchased the latest and greatest of everything. As long as your equipment is safe and clean, all your baby cares about is your love and attention.
So explore low cost ways to get kitted out. Buy or borrow pre-loved gear from friends and family. Or, when someone asks what they can gift you, suggest something with a value that reflects the giver’s financial means and relationship to you.
Some forward planning pays off. You may not be able to prevent your new baby waking at 3am, but with financial plans in place you won’t have to spend the small hours stressing over money matters.
Members Equity Bank Limited ABN 56 070 887 679 AFSL and Australian Credit Licence 229500.