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6 Ways to Financially Prepare for Your First Child

If you are reading this because you have a new child on the way—congratulations! Each child is a blessing from God, and I could not be happier for you.

I remember the days leading up to the birth of our first child—emotions and questions filled my head. I felt ready and completely unprepared at the same time. You are probably there as well.

While there are many important questions to answer at this stage, I want to focus on the financial piece. After all, this is a personal finance site.

As you wait on the baby’s arrival, there are a few financial moves you can make now to better prepare you for the future. Here are some suggestions:

1. Calculate the cost of delivery and save accordingly. The average cost for vaginal delivery in the United States ranges from $3,500 to $11,000. If you are to have a C-section, the costs increase. Health insurance and the number of days you stay at the hospital can play a significant role in your costs as well. Needless to say, the range is pretty broad. So, you will need to do some research. If you have health insurance, contact your provider to see what’s covered. You can also reach out to the hospital’s billing office to get a good understanding of their costs. Once you determine the costs, start saving. Don’t go into debt because you were unprepared.

2. Calculate the costs of essential purchases and save accordingly. You will likely need some additional items for your child—like a crib, diapers, and clothing. Granted, you can save a significant amount of money if you get used furniture and acquire some hand-me-downs clothes. By the way, I have yet to receive a complaint from my children about wearing hand-me-downs as an infant. Like delivery costs, once you have calculated the costs of essential purchases, start saving. Don’t swipe the credit card for items you cannot afford.

3. Create a new budget. Your baby is going to create additional expenses. Diapers, baby formula, and doctor appointments will likely require that you reduce expenses in other areas of the budget. Go ahead and start planning what expenses you will reduce now. This will help you get acclimated to operating on a budget that mimics your future financial reality. And what should you do with all that newfound margin? The answer is found in the first two suggestions.

4. Get a will. My hope is that you get to live a long and healthy life, watching your child grow up to have children of their own. But, as you know, we are not guaranteed a single hour of life. So, you must protect your spouse and child by having a will. A will tells how you want your assets (what you own) distributed in the event of your death. But that is not all. If you have a child who is still a minor at the time of your death, you can use a will to determine who takes care of your child and who manages their inheritance until they reach a certain age. So, make sure your child and their inheritance is cared for with a will.

5. Get term life insurance. Life insurance provides money to your beneficiaries should you die. Now that you are having a child, I highly recommend that your household’s primary wage earner has a policy. I suggest the amount needed to care for your spouse and child through your child’s (or children’s) college years. I like term life insurance. Term life insurance guarantees the benefit for a certain time period. During this time period, you make regular (usually yearly) payment to maintain the policy. Again, I would get a term that carries through your child’s college years.

6. Start researching 529 Plans. Yes, you need to start considering college savings. The earlier you start, the better off you will be. 529 Plan allow you to put after-tax dollars into the account, invest it, and take the funds out tax-free for educational purposes. You can choose any state’s 529 Plan so they are worth researching. Look for plans that have a great five and ten-year performance. One of my favorite sites for this is

This is an incredibly exciting, and probably somewhat anxious, time for you. Planning ahead can be a tremendous help. Consider these financial suggestions to help you prepare for parenthood.


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