5 Money Matters to Keep in Mind Before Baby Comes

Date posted: June 27, 2016

Preparing for your baby’s arrival can be one of the most exciting times in your life. However, it’s important to consider the many costs that inevitably come with having a baby. Here are five money matters to keep in mind when anticipating the birth of your little bundle of joy.

Create a monthly budget with “Baby Savings”

It’s been said that those who fail to plan, plan to fail. By developing a pre-baby budget, you’re ensuring that you set yourself up for success. Lay out all monthly expenses such as rent, transportation, cell phone bills, and debt payments, along with other expenses like groceries, clothes, and so on. And, now that your family is growing, you should also add a new component to your monthly budget – Baby Savings. By saving as little as $25 a week, you could save $100 a month. That’s $800 or more by the time your baby is born! You could use that money towards the purchase of a stroller, a crib, or anything else your baby might need. A little goes a long way!

Take advantage of the Canada child tax benefit

Did you know that the Canadian government provides a non-taxable monthly payment to help with the cost of raising your child? The Canada child tax benefit (CCTB) provides financial assistance to the primary caregiver of a child. By filling out the Automated Benefits Application on Canada Revenue Agency’s (CRA) website, you can be eligible to receive a monthly payment soon after your baby is born.

The amount of money you may be eligible to receive is based on two factors:

1.    How many children you have and how old they are

2.    How much money you make (net income)

Every year, you may get up to $6,400 for each child under the age of six, and $5,400 for each child aged six through seventeen. Families with less than $30,000 net income get the maximum benefit amount, as listed above, while families making more than $30,000 receive reduced payment amounts within those limits. To see how much you may be eligible for, go to CRA’s online child and family benefits calculator.

Research inexpensive options for feeding baby

When it comes to feeding your baby, you should be aware of the associated costs before your baby is born. For mothers who decide to feed their babies with formula, the costs are immediate and ongoing. The average Canadian family will spend nearly $100 a month on formula during baby’s first year. With each tub of brand-name formula averaging between $25 and $50, these costs can add up quickly. The good news is that as your baby is weaned off formula and transitions to solid food, the formula costs go down.

If you breastfeed, the immediate costs are not as steep, but other costs eventually do come into play. For example, devices like breast pumps can add to the cost of breastfeeding. Low-cost pumps start at under $20, but can easily climb to the $250 mark when you start adding in features and benefits.

Regardless of whether you are feeding your baby with formula or using a breast pump, you will need to take the cost of feeding bottles into account. Glass and BPA-free thermoplastic bottles average from $15 to $30 or more, depending on the brand. Associated costs include bottle nipples, which must be purchased in addition to the bottles and need to be replaced regularly. Be sure to include those estimates in your budget as you plan for baby-related expenses.

Hunt for special offers on diapers and baby products

As if having to change diapers wasn’t bad enough, having to buy them at such a high cost makes it even worse. The average Canadian baby uses a staggering 6,000 to 8,000 diapers in their first three years, and with most brand-name diapers costing 15¢ to 25¢ each—that’s a whole lotta cash going down the toilet, so to speak! Alternative options include purchasing less expensive store-brand diapers, buying in bulk during promotional sales, and using as many coupons as possible. Many families are opting for another, more environmentally friendly, cost-effective solution of reusable cloth diapers. Even with the added laundering costs, you can actually save hundreds of dollars a year compared to purchasing disposable diapers.

Canadian families can also benefit from programs such as Baby Box Canada, a non-profit organization that helps families by providing them with many of the essential products they need to care for their newborns. By simply registering online, expecting parents can receive their very own Baby Box filled to the brim with free baby products from leading brands, such as Fisher-Price, Burt’s Bees, and Philips Avent.

Use social media to buy used baby items

Special buy, sell, and trade Facebook groups in your local community are a great resource that new parents should take advantage of. By joining buy-sell groups with other parents in your community, you can find specific items that you might need immediately, or as your baby grows. Buy, sell, and trade Facebook groups can be found in communities all across Canada, including Cold Lake, Alberta; Cape Breton, Nova Scotia; and Brampton, Ontario. These groups open up your network beyond your own Facebook contacts to other parents in your area, allowing you to buy things at a fraction of the cost of what you would pay at a store.

Despite the many new and exciting challenges that will inevitably come with bringing baby home from the hospital, don’t let the associated costs of a newborn overwhelm or discourage you. Planning and budgeting ahead allows you to concentrate more on your new bundle of joy and less on what the next expense is going to be.

Check out more related content:

Should You Build an Emergency Fund or Pay Off Debt?

Published on: Oct. 21, 2016

Continue reading

Money Minute - What if a Creditor Calls

Published on: Oct. 19, 2016

Watch video

How To Start Over After Losing Your Job

Published on: Oct. 14, 2016

Continue reading