How to become more financially savvy *before* your baby is born

Ready to bring a baby on board? Feelings of excitement can often be met with those of financial concern as you prep for this milestone. According to the U.S. Department of Agriculture, as of 2015, the cost of raising a child is $233,610—a number that can make anyone’s jaw drop to the floor.

But before you start to worry, here are ways you can become more financially savvy before the baby is born:

1. Budget for healthcare costs

The cost of delivering a baby can vary by state, but suffice it to say it can be thousands of dollars. Castlight Health found that the lowest average cost of delivery was $6,075 in Kansas City, MO and the highest average cost $15,420 in Sacramento, CA. Costs are even higher for a Cesarean delivery.

The first thing you want to do is check your insurance and see what they will cover so what you will be responsible for. Then create a separate savings account so that you can cover any costs that you’re on the hook for. You can set up automatic savings after each payday up until the baby is born to help assist with any healthcare costs associated with delivery.

2. Cut your expenses

Before the baby arrives, do a spending audit and see where you can slash some expenses. Free up any leftover money to help cover the increased costs that will come, such as food, clothes, and formula.

If you’re struggling with how to do that, take a look at all of your expenses and write next to each either”want” or “need.” Look at your “want” list and see which expenses are ones you can either eliminate or cut back on. If it doesn’t bring you joy or add value, ditch it! You might even find subscriptions that you didn’t know you had.

3. Go for second-hand goods

Of course, there are some things you definitely want to buy new for baby, but things like clothes and toys you can get second hand and save a lot of money. Your baby will grow so fast and buying new clothes every few months can add up. If your family members or friends have old baby clothes or toys they’re willing to part with, it will save money and you can pay it forward down the line.

4. Look for sales or coupons

Clothes and toys are items that you can buy second hand, but products, like a car seat and crib are best new. You want to be up-to-date with safety and know what you’re getting. Before going shopping, search for sales or coupons before you head out. A little research online can go a long way and save you hundreds.

5. Have a garage sale

If you need to make room for baby, it’s time to get rid of items that you no longer use or need. Take all of the stuff you are planning to get rid of and have a garage sale to make extra money. You can also try selling online on Craigslist, Poshmark and OfferUp too.

Take the money you earn from selling your stuff and put it in your savings account earmarked for your baby.

6. Get a 529 plan

It’s never too early to save for your baby’s college. You can open a state-sponsored 529 plan which is a tax-advantaged savings account for education-related costs. Instead of asking for gifts or toys from family and friends, you can request money to go toward a 529 plan. It will be an impactful gift that will help your child in the future and help lessen the financial burden on you.

7. Prep now instead of later

Your whole world will change when your baby arrives, so in order to save money, time and stress, create a plan now. Is there a family or friend close by who can babysit if you need some rest or have to run an errand? Ask them now if they can help out.

Start preparing meals in bulk that can be in the freezer and easily made so you don’t have to think about food. Put your bills on autopay so that you don’t miss any payments and get hit with late fees. Know how long you can get maternity or paternity leave and understand how that will affect your income and budget. Getting all of this ready ahead of time can help you in the long run.

8. Purchase life insurance

While thinking about why you need life insurance can be a bit stressful, preparation is essential, especially when you’re adding another member to your family. Life insurance will provide financial support if you had a loss of income due to something happening to either you or your partner.

9. Understand any tax benefits

The birth of your baby will affect your taxes, which can actually end up putting more money back into your pocket. Do some research online and see how a dependent will change your taxes in your state, such as new exemptions available. Or, find a trusted accountant or tax specialist in your area who can walk you through your options.

You might also like:

• 5 easy steps toward saving money as a new parent
• 11 money-saving products that grow with your baby
• 10 family budgeting secrets mamas swear by