So you have a baby (or babies) on the way?
Congrats! Along with the chaos of, well, everything that is to come, your finances are about to experience and upheaval as well. According to the US Department of Agriculture, it will cost you an average of $245,000 to raise a child (this doesn’t include inflation now) to the age of 18. College not included. If you feel like your bank account is already depleted by reading that, below are five tips to rock your budget as a new parent.
- Track your spending. Don’t just make the budget, set it aside. Set a monthly recurring meeting with yourself and/or your spouse to look over your spending. Make sure you’re on track and identify any problems or potential savings.
- Tweak your budget. Your new little one is going to cost you a pretty penny. From hospital visits to diapers and childcare, the budgetary stress is just an added strain on you as a new parent. Look for unnecessary spending you can slash to make room for more baby dollars. Because that cute outfit that you eye ball on your way through Target might just have to come home with you.
- Learn your tax credits. Bet you didn’t know that was a thing, huh? Being a parent has some tax advantages. So talk to your tax professional about what you may be eligible for.
- 4. Automate, automate, automate. Not only can automation help you avoid bouncing bills, but it can also help you pad your savings account too by automatically withdrawing money from your account and moving it to your savings account. Figure out how much you can part with every month and automatically move it over to your emergency fund, college savings account, or both.
- Set financial goals. Creating a budget and savings plan is great, though setting goals for your family can help you stay on track. Looking to have a set amount in a college account by the time you kid turns 18? Is an annual family vacation a must? Do the math and decide how much you need to save monthly and stash that cash to make it happen.
- Stay informed on market changes. If you’re looking to buy or sell real estate, keep up on market trends to know when the timing is right for you.
Above all, don’t forget to be realistic and forgive yourself if it takes some time to get on track. Parenting, after all, is a lifelong (rewarding) adventure.
