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Babies on the Brain
CandieR90
member
Financially Stable
CandieR90
member
So I guess my question is can anyone financially ready for a baby? I mean my thought is you can never be fully 100% ready right? What makes you financially ready?
This discussion has been closed.
Re: Financially Stable
Well, it depends- if you look at the costs of raising a child, it's intimidating and you feel like you'll never be ready; however, most people are able to find a way to make it work.
I think you're ready if you can cover the following costs:
- Can afford daycare/nanny/someone staying home with LO until they're ready for school and before/after school care if both parents work
- Have now or can afford a car and living space to fit kid(s).
- Have $2-300 extra per month for diapers, formula/food, clothes
- Have the funds to set up a nursery and get baby gear (crib, car seat, stroller, initial supply of clothing, etc.)
- Have life and disability insurance and a will/trust set up to ensure adequate care if anything happens to you and/or your husband.
You could spend an infinite amount of money on a child if you wanted to- private schools, Disney vacations, etc., but if you have the ability to cover the basics, you should be good to go.
I'm in the same boat as you, more or less. I ran the numbers for child costs in my area (Seattle has INSANELY high day care rates - keep that in mind). I am not lucky enough to have local family who can watch the baby and I work 40+ hours a week at a job I love and would go insane without.
I have insurance that covers all pre-delivery visits with no copay, and delivery in-patient is about a hundred a day. At most we'll pay $500 for delivery. HMOs rock!
Up front cost of things before the baby arrives is ~$3-4 K. This is citing a website I found that breaks it all down
https://www.justmommies.com/articles/costs-having-a-baby.shtml
Then I estimated food costs, consumables, nearly full time child care, additional insurance premiums, etc and that ran ~$20K a year. Childcare is a big chunk of that.
So, my sweetie and I will be financially ready when we have enough in the bank for the delivery and up front costs and paychecks that will cover the annual 20K estimate. We will have that by this summer, when we're starting TTC.
DH and I had a long conversation about having children and being financially responsible. I know that my job will not give me much maternity leave time and I would have to use whatever vacation hours I have after two weeks. I plan on going back to school soon so I already had money saved up to support me for almost two years. With the possible addition of a child, we started adding money to a savings account. I was expecting a child twice before so, I have a lot of items already saved up. All I need now is a stroller, crib and gender specific clothing. We made different accounts to support all of our needs (including an emergency fund). It may sound extreme but, I have OCD for organization.
Like others have said, it is very important to check with your insurance company to know ahead of time what will be covered for you. Some insurance companies require you to pay a copay when you get to the hospital to deliver. Because of my medical conditions, I also checked to see what benefits my child would be covered for. Now is a good time to start making plans and saving accordingly.
I 100 agree with this. That includes insurance coverage. I would never have a child without having insurance.
DH and I own our condo, have two reliable cars, have great health insurance, and work full-time, so we are lucky and feel prepared in those areas.
I know that I want to be able to return to work and will only have 12 weeks of partially-paid maternity leave plus I will probably use another 2 weeks of paid vacation once we have a LO.
The main thing for us is having a decent emergency fund as well as enough money to cover my loss of income for maternity leave in savings and paying down our credit card debt (should be almost gone by May!). We have also started researching childcare costs in our area so that we can plan for the additional $800/month or so in expenses.
I do agree with PP's that people find a way to make it work and that financial stability means different things to different people! Best of luck to you!
On every level, this. It's insane to expect that every couple that decides to have a baby will have a big cushy savings account and a nice house etc etc. As long as you can take care of the child and love and nurture it, I say go for it. It may not be easy, but that doesn't mean you shouldn't do it.
I totally get where GhostMonkey is coming from and agree with her statement. I think it is irresponsible to bring a child into this world that you are not at least somewhat prepared for.
You stated that if you were on welfare your whole life you would have a kid regardless. That is just wrong. Why should taxpayers have to help pay for other people's kids?
Me: 29 / Hubster: 31
Married July 2010
DC #1 Oct 2013
DC #2 EDD June 2016
For me my financial goals boiled down to:
1. Credit cards paid off
2. 6 months of bills in savings
3. Enough "left over" cash each month to cover day care, diapers, formula...
4. Enough cash each month to still be able to save and have fun because nobody is ever perfectly on budget.
I was just like you in searching for that pre made list of how much money to have and for what. But that list doesn't exist because each family spends differently and prices vary based on where you live, what brands you buy, and what items you feel you have to have.
Make your own list. And there's no reason it can't change once you write it down the first time.
My Ovulation Chart Simple Link: My Ovulation Chart
The point of this community is to be supportive which does not include name calling and belittling. Let's be kind to one another, please. No one said we all have to agree on everything. You don't know anything about me and my life. I am definitely not privileged. Let's not be nasty, please.
Me: 29 / Hubster: 31
Married July 2010
DC #1 Oct 2013
DC #2 EDD June 2016
You should be financially stable, yes. That means enough to cover the medical expenses with pregnancy/delivery, the day to day stuff like childcare/clothing/diapers/wipes with some wiggle room in your budget/savings. If your kid isn't born perfectly healthy, it's f'ing expensive. You should be (somewhat) prepared for the possibility.
Some people feel like they're never financially ready and that's a different thing than financial stability. Draw a line in the sand. Set some financial goals and when you hit them have a kid. Don't keep delaying it based on the what ifs but don't do it because babies are so cute and fun when you can't adequately provide either.
In my case, we were SO prepared. We were financially ready and had researched the true costs of having and raising a child in our area. We were both homeowners, and had good longterm tenants in the houses we owned and were renting out the properties until the market was better for selling. My tenant was an employee of the federal government with a security clearance and perfect credit. I never thought that her husband would walk out on her and that she would stop paying the rent while I was on maternity leave.
We had to go through a lengthy eviction process, and before she was finally evicted, she caused over 25k worth of intentional damages. I'm talking actually painting the carpets, urine and defacating on walls and floors, spray paint outside, pulling out every electrical socket from the wall, removing doorknobs from every internal door, and taking a knife and slashing through drywall in each room. I went after her in court, but it took over a year to get a garnishment and it only covers a fraction of the cost. I was NOT expecting that kind of financial blow, and it was not really a scenario that had occurred to me because she HAD a background check from the government and had great creditI didn't know someone would go that nuts.
What did we do? DH worked as much OT as he could, and worked a 2nd job. We found parttime child care and because he worked nights for both jobs, he was able to be with our daughter 23 days a week to bring down that cost. I went back to work at 6 weeks postbaby, when my paid medical leave ran out. We worked like crazy to try and sustain that mortgage on an empty and unrentable house, but eventually realized that it was unsustainable.
We talked to a lawyer and financial planner about all of our options and how each would impact us financially in the long and short term, and came to a difficult decision to list the house as a short sale. If not for the housing market crash, we could have brought enough to the table for a regular sale, but the crash combined with the damages would have wiped out all of our liquid assets and drained our retirement accounts. We then would have been one paycheck away from homelessness, and that is definitely not a financially responsible way to live with an infant. The stress we were under nearly ended our marriage. It definitely was making me physically ill, and I feel was a contributor to the PPD I experienced.
You can prepare for a million scenarios, and be blindsided by one you didn't see coming. I think you should be in a place where you have your finances under control, you have retirement savings, you have good health care coverage, you have sufficient disposable income and savings income after taking into account the costs of raising a child. But know that even wih all of that in place, you could have something completely unexpected. You should have an idea of what you will do of the proverbial shizz hits the fan.
That is something we didn't have at first, but have talked a lot about since we went through our rental house hell. We got rid of DH's property Even though it was a loss, because we found out how much more we stood to lose by keeping it. We have discussed where we would go and what we would do if one or both of us suddenly lost our jobs or became sick. We have good life insurance so that our kids will be taken care of if something happens to us. It is irresponsible to have children knowing that you will depend on others, particularly taxpayers that don't personally know you, to support your choice. However, you can't foresee every single scenario out there...but you can try to be as prepared as possible and adapt to the unexpected in a way that takes care
Of your child and family with the smallest burden on others.
We told ourselves we would wait till we had 25k in the bank, then we would think babies. I'm good with working with a set goal. I'm not good doing things spontaneously. It actually gave me a number to check on.