Saving for maternity leave

ewenner · October 2014

I am very nervous about the idea of eventually going on maternity leave, and how that will impact our finances, especially since I have always been the primary income earner in our household (and trying not to think about the fact that DH just lost his job). Through my work, I will get five weeks of short-term disability, which is "supposed" to be 2/3 of my weekly salary, but the maximum weekly payout actually adds up to only about 1/3 of my weekly salary. I am not yet sure what the rules are regarding using vacation and/or sick time for maternity leave - I plan to ask that question once I actually tell me employer about the pregnancy.

Since I am only 8 weeks along, I figure I still have lots of time to start saving and planning for when I eventually have to go on leave. Anyone out there have tips or suggestions that have worked for them? Any good tools that you use to help? I have asked Google, and most of what I've read is very generic "track your spending," "don't eat out," type of advice. I am hoping for some more concrete, practical suggestions to get us on the right path and calm my nerves. Thanks in advance!

marijaa333 · October 2014

You're smart to be thinking about this now! One idea would be to open a second account just for the leave, and use online banking to transfer as much as possible into it throughout your pregnancy on a daily or weekly basis. By the time you go on leave, you would have a small stash that is separate from any other savings. Assuming you have around 200 days to go, if you're disciplined about it, it should add up to a nice sum.

Samuelismomma · October 2014

We are actually working on getting out of debt and paying off small things we have so DH can take off some . It is not paid. He took off early when I had DS and went to work next day because he had just started job and wasnt off probation period. It was a lot to handle especially nicu and everything. Just to be safe we are planning this baby early too...your smart to start early:)

BeckyP005 · October 2014

I'm freaking about this too. I'm a nanny/house assistant so not sure what I can get. My boss has me on his payroll at work so I guess I need to see if I can get short term disability? Not sure if it would be offered to me. I'm so confused. I've been with them for 20 yrs so I'm hoping they give me a break EVEN though they shouldn't be responsible too. Well maybe just a little I'm thinking all the times they didn't have to pay a kennel for their dog that I watched for free...haha.

This all sucks and I have to go back to work at 6 weeks. Boo I know I'm not the only one and it still sucks!!

marijaa333 · October 2014

@BeckyP005 if the company on whose payroll you are has more than 50 employees, you should qualify for 12 weeks under FMLA. Some states extend this to smaller companies (e.g. over 10 employees).

supersarah77 · October 2014

I worried about leave the first time and I'm worrying again for #2. I was able to save up sick days and vacation days to get 100% pay those days and then use short term disability partial pay. I don't know if that's law but I hope you can do the same. Also, friends and family brought us lots of food the first couple months so that helped with food expense. Friends have had other friends set up a meal train for them on mealtrain.com. We were also gifted a month of diapers, more money saved. We shut off our cable and switched to basic Netflix. I wasn't driving to work so I didn't need to fill up my car for at least a month. All that added up to several hundred dollars. And if you're also starting to put away for leave now, you'll be set. As ambiguous as it sounds, these things really do have a way of working out. Once LO gets here all these worries will be less important because you'll be totally caught up in your new baby.

niknak1208 · October 2014

Ugh. I am right there with you!!

I worked for a large university doing disability management for 8 years. When I worked there, some staff were able to use PTO to supplement disability. I work for a large hospital now and here we are only allowed to use PTO during the waiting period before disability kicks in. So you have a 14 day wait before your disability kicks in.. you use most or all of your PTO to cover that and then you only get paid 50% of you pay for 4 weeks basically! You can take the full 12 weeks. of course under FMLA but then it's all PTO after disability stops at 6 weeks (unless there's some kind of complication).

I am freaking out about it as well. My hubby just started a new job in August and he took a pretty significant paycut to do it because over the long run.. it will end up being the better choice. But right now it's super tight. But we weren't planning on anymore kids and here were are! I had my other two kids when I worked at the university and there disability is 100% of your pay and I had 400 hours of vacation when I went off with my daughter so I ended up being off work for 4.5 months at full pay! I'm totally not used to this 50% of your pay crap.

On top of that.. we also have to pay our benefit premiums to the hospital while we're off.. which will not deduct from our disability payments because those payments are coming from another company. So you get 50% of your pay and then out of that you have to pay your deductions every pay period!

Yep.. it sucks. We're hoping to be able to save enough for me to take the full 12 but I basically need about 5k in the bank to be able to afford to take 12 weeks off. It sucks.

If your employer has 50 or more staff members... you've been employed for at least a year and have 1250 hours worked in the last 12 months.. you are eligible for 12 weeks FMLA which is the UNPAID portion of your leave. If they do not have to comply with FMLA because of the number of staff members.. they DO still have to comply with ADA. (American's with Disablities Act). Almost everything is a 'disability' under the ADA. ADA is also unpaid. And does not protect YOUR job.. only employment in general. Typically, FMLA/ADA run concurrent with your disability plan.

Samuelismomma · October 2014

America is the worst country (industrialized) for maternity/paternity leave and pay. My H literally told me he hopes I have the baby on a Thursday or Friday so he only has to take a couple days off to be with me a week. I know sounds awful but he wasnt being crappy, just worried:( . My sister I think is going to arrange to be with me a couple days too. Which I am grateful but is terrible she has to and not H...

marijaa333 · October 2014

@Samuelismomma I think it's in the bottom three of all countries-right along with Swaziland and Papa New Guinea.

ewenner · October 2014

Thanks for all of your thoughts so far! America IS the worst country for maternity leave. Maybe DH and Is should just pack our bags and run away to Europe so I might actually get some decent paid leave. Oy.

niknak1208 - I hadn't even thought about having to still pay the benefit premiums while I'm out! Thanks for the heads up on that!

marijaa333 - I like the idea of setting up a separate account just for maternity leave/baby savings. We already have a house saving account, so adding another one shouldn't be too hard.

mandyreads · October 2014

I feel really blessed that I haven't had to work since our first daughter was born 14 yrs ago. I hope that doesn't sound snotty. But what works for us is coupons. I love them even though I haven't been as up to it lately.

We used to do all our grocery shopping at Target (we had a super one in Memphis where we used to live). And they do their coupon plus manufacturers coupon combined. Then I got an extra 5% off for the redcard. I would save so much there on our groceries. Where we live now the Target is not super. But I still go there for a lot of things and use the cartwheel app whenever I can.

With a family of 5 (soon to be 6) I try to coupon shop and clearance shop as much as possible.

anonymousmotley · October 2014

Thank you for posting this! It has prompted me to go to HR and inquire about my benefits.

KirstenAlecia · October 2014

I think the money aspect is nerve wracking for most.

For me Im Self employed as well. So its pretty much what we save. I do plan on working my business till the very last moment before he/she arrives as long as my health cooperates.

Im sure my hubby will put in extra hours at work as well. Im going to do my best to get lots of business going in the coming months to help. Christmas is going to be small this year.....no spending like i normally do thats for sure. I think coupons and stuff like that are in our future. Im also planning on buying baby necessities as soon as we go through the first few appts.....anything to save a penny when it comes to the time i wont be able to work.....or don't want to be working.

niknak1208 · October 2014

For sure! Definitely ask about premiums. If they do disability in house.. deductions will probably still come out the way they normally do. But if there's a third party administrator, there's really no way for the organization to deduct for benefits. It really makes it tough for people who are off work. To only have 50% of their pay and then have to turn around and give money back for premiums. It's hard. I also took a good hard look at our benefits.. becuase it's open enrollment time at most organizations.. and made sure that I picked beneifts appropriately to limit any out of pocket expenses we might have.

I didn't know Target still doubled coupons. That's the issue in Michigan.. most stores won't double anymore. I coupon shop like crazy and I always clearance shop too. Both of my kids are already stocked up for summer next year. lol My daughter has 3 bathing suits.. mostly becaus toddler clothes are so adorable! But coupons only get you so far unless you're like the extreme couponers they have on tv!

MrsDL · October 2014

Since I am only 8 weeks along, I figure I still have lots of time to start saving and planning for when I eventually have to go on leave. Anyone out there have tips or suggestions that have worked for them? Any good tools that you use to help? I have asked Google, and most of what I've read is very generic "track your spending," "don't eat out," type of advice. I am hoping for some more concrete, practical suggestions to get us on the right path and calm my nerves. Thanks in advance!

Since you are going back to work, if you are not fortunate to have free/inexpensive childcare (like family, etc.), look into it now and put the money you will be paying weekly/monthly, etc into savings. It depends on the area, but we had complete sticker shock with our first ($1600 a month for infant care). Once we got onto waiting lists (another shocker - people do this well in advance and we started looking in the early 2nd tri with our first and had to be on lists), we started to put the money we knew we would be paying when I went back to work aside. It added up quickly. Plus, we got used to living without that money (and figuring out where in our budget we had to cut to pay for it) ahead of time which was sort of a bonus.

ewenner · October 2014

MrsDL - Thanks for the child care tip! I know it can be crazy expensive, so that's a great idea to start saving up ASAP. I did not realize that people sign up so far in advance! Crazy! I suppose my 'maternity leave" fund will eventually morph into a "daycare fund." If only my cat could babysit for us...

niknak1208 · October 2014

Ahh yes.. lovely daycare. lol It's crazy expensive pretty much everywhere these days. If you can find a nice licensed homecare.. they are usually cheaper but some people don't like homecare. Personally, I have had fantastic experiences with the homecare centers that I've had. I had our son in a home care place for 3 years before he went into preschool and I adored them. They became like an extension of our family and they truly love my child.. to this day and he's almost 6. My daughter was in a center initially because I NO ONE had baby space and I hated the center. They nickel and dimed me to death! I mean to death! I had to leave work and would not even have time to stop for gas because if I was late.. even by a minute.. I had a $25 late fee. It was nuts. I also had issues with their care. I picked her up one evening and she was about 4 onths old and she had marker all over her. On her face.. her hands.. her arms. Now tell me how a 4 month old who isn't walking and isn't crawling.. is getting marker on her face, arms, and hands? Exactly.. I was not pleased at all. After that we moved her to another homecare and again.. adored it. I'm in Michigan and home care around here is usually $125/week. Unfortunately, they closed and I had to move her. My son's elementary school has a childcare program.. they just have to be walking and able to drink from a sippy cup. So I put her there adn that's where she still is and that's $170/week.

When considering daycares, also look at what food is like. Obviously for infants you're bringing your own breast milk or formula but when they're old enough daycares usually provide something. but some don't. I visited centers that were close to $200/week that provided ZERO food. My home care was $125/week and she provided milk and snacks and breakfast!

Definitely start looking early. I had a heck of a time with my daughter and when I was pregnant with my son.. i had him on a waiting list when I was 16 weeks pregnant!

leela02 · October 2014

As far as tools go I use YNAB software to deal with our budget. It's not free (you can download and try it for free for a month) but worth it for us... It's a good alternative to maintaining multiple savings accounts for each thing we're saving for (emergency, college costs (I'm a student), child care, home, etc.). Basically it lets you budget amounts regardless of where the money is sitting, so you know how your savings are split up no matter if you're using multiple accounts or just one big savings acct.

starlightgator · October 2014

Oh boy! This is even more stressful than I imagined. I'm also the primary breadwinner and my hubby lost his job two weeks ago. So scared too. Haven't even thought about daycare. I guess I'm hoping that my parents will help since Dad's retiring in the spring. Soooo expensive! And we just found out that we're having twins!

ewenner · October 2014

leela02. I will definitely check out that software.

starlightgator - it sounds like you and I are in a similar situation. I hope that your parents will be able to help out with childcare - that would certainly save you quite a bit of money.

lgsdesigner · October 2014

I am trying to save $100 a paycheck. It isn't always easy to do, but it's worth a shot.

Dancerppf · October 2014

It's truly disturbing that the US is so behind the rest of the world when it comes to this but then again they pay us $0.77 to every man's $1. I'll be taking 10 weeks, 8 of which will be my own sick and vacation time. 2 weeks will be unpaid, or a disability check which is 1/3 of my weekly salary.

BSTmama · October 2014

I highly recommend looking into Dave Ramsey, he has tons of advice about how to save. Creating a budget is step one to saving....when you REALLY pay attention to your money you see quick ways to save. Check out Dave Ramsey.com or his book Financial Peace or try to catch his pod casts. We got out of tons of debt and now have a savings account that would support our family and all expenses for 3-6 months.....it's an amazing feeling of security. If you could go into maternity leave with a nice chunk of change in the bank it will give you that much more peace of mind and less pressure to rush back to work.

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