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How to Budget for a New Baby

Updated on November 24, 2020
caseymel profile image

I am a stay-at-home mom to two wonderful children who keep me very busy. I love technology, gardening, cooking, and personal finance.

The Cost Of A New Baby

Having a baby can take it's toll on your bank account. Trust me! I have two children.

Through trial and error, I have found ways to budget for a new baby. Start putting money aside for medical bills, diapers, formula and child care when you find out your pregnant.

You will find that a lot of surprise bills pop up that you wouldn't have expected.

I would say that if you have $3,000 to $4,000 in your savings account for baby when it is born, you will be in good condition.

This guide will help you to budget for a new baby!

Babies need lots of love!

Babies need lots of love!
Babies need lots of love! | Source

The Cost Of Delivering A Baby: Medical Bills

The biggest factors when it comes to the cost of baby delivery are if the birth was vaginal or C-section, if there are any complications and how long the Mother and baby stay in the hospital.

A uncomplicated vaginal birth could cost you anywhere from $9,000 to $ $17,000 before insurance.

An uncomplicated C-section birth could cost anywhere from $14,000 to $25,000 before insurance.

After insurance, either could cost you between $500 to $3,000 depending on type of birth, complications and hospital stay. This is just the bill for the Mom!

The baby gets a separate bill. The typical medical bills for a new baby with no complications range from $1,500 to $4,000.

If there are any complications, you are looking at a much higher bill.

Make sure you have insurance when you deliver since this could knock the price of the labor and delivery bill down dramatically.

Also, remember to call your insurance company the day the baby is born to add them to the list of dependents.

Otherwise, you will have bills bouncing back to you that the insurance company will not pay since your new baby is not on the list of dependants. This happened to me!

We called our insurance company after I had my first child to let them know that he was born. I called while we were still in the hospital.

For 7 months after my son was born, the insurance company kept denying my sons bills with a note saying that they cannot pay his delivery bills since he was not on the list of dependants the day he was born.

I kept calling them to explain that he was born that day and that was his delivery bill, but they kept coming back at me saying he was not on the list of dependants for our insurance plan that day.

I was worried that this was going to cause our credit rating to go down since the bills were not getting paid.

After many phone calls with my insurance company, when my son was 7 months old, they finally fixed the problem and started processing the bills.

Stay At Home Mom

Stay At Home Mom
Stay At Home Mom | Source

Should One Parent Stay Home With Baby?

Each family has to make a huge financial decision once the baby is born.

Should one parent stay at home with the baby and quit working or should you both keep working.

This is a tough decision that plagued me during my maternity leave with my first child.

If one parent decides to be a stay at home mom or dad, you lose an income, but you don't have to pay for childcare and your family may fall in a lower tax bracket.

If you both would like to keep working, you still have two incomes (and adult time), but you have to pay for childcare.

To make the decision, we looked at the cost of child care as opposed to the income we would lose.

Since we decided to have two children, all of my income would go towards childcare and then some.

I actually would end up paying money to go to work!!!

I decided to stay-at-home with my children. It ended up working out nicely. We were bumped down to a lower tax bracket, so less of my husbands money is going towards income tax.

I also am able to spend more time cooking, cleaning and couponing. We save money on food since we are not eating out as much since I have time to cook.

We are also saving money since I am able to search for sales and coupons to cut our grocery bill in half each week.

Baby Formula vs Breastfeeding

Formula for babies is expensive and they go through it so quickly since that is all they eat. Also, some babies have difficulty digesting formula.

To save money, either breastfeed or find coupons or sales that you can take advantage of to lower your baby formula bill.

Breastfeeding is a great way to save money when the baby is first born.

Sure, you feel like a cow strapped to a chair most in the beginning, but it gets easier and faster over time and it saves tons of money.

You will also lose weight faster. If you have the time to do it, I would definitely recommend it!



Saving For College

When starting my children's 529 plans, I asked a financial planner how much I would need to put into the plan each month to fully pay for college when they are ready to go.

He said that I would need to put away $400 per month, per child if I start the plan as soon as they are born! I almost fell off my seat!

We have two children. That is $800 per month!!! We are not able to put that much money into the plan each month, but we do put something in each month.

We have the money automatically transferred to each child's plan twice a month so we don't have to think about it.

We have seen substantial growth in just the small amount we put in since we started the plans last year.

Never take money away from your retirement to put into your child's college savings plan.

They can take loans out and get grants for college. You can't take loans out for retirement.

Cheaper than Pampers, but works just as well!

Diapers Newborn/Size 1 (8-14 lb), 252 Count - Luvs Ultra Leakguards Disposable Baby Diapers, ONE MONTH SUPPLY
Diapers Newborn/Size 1 (8-14 lb), 252 Count - Luvs Ultra Leakguards Disposable Baby Diapers, ONE MONTH SUPPLY
This was my favorite diaper when the kids were babies. They were cheaper than Pampers, but worked just as well!

Diapers And Wipes

Diapers and wipes are expensive! I would spend around $60 per month per child on diapers and wipes.

The amount goes down as they get older and go through less diapers each day. There are tons of diaper coupons out there.

Print them off of the diaper companies website and sign up for their newsletters. You will sometimes get coupons in your email box!

Another great way to save money on diapers is to sign up for an Amazon Mom account on Amazon.

You can get diapers and wipes delivered to your door at a discount and normally shipping is free.

You can schedule them to ship out monthly, weekly or bi-monthly, so you don't even have to go to their website.

Huggies and Pampers are the top two diaper brands. If you like Pampers, but don't like the price, try Luvs.

They are made by Pampers. The are like a no-frills Pampers diaper and much cheaper. Try Huggies and Pampers to see which fits your baby best.

What works great on one baby, may not work at all on another.

Britax Marathon Convertible Seat

Britax Marathon G4.1 Convertible Car Seat, Onyx
Britax Marathon G4.1 Convertible Car Seat, Onyx
This is the carseat I used and I loved it! I felt like my baby was safe while in it. It was easy to use.

Baby Furniture, Toys and Clothes

Buy used baby clothes, toys and furniture.

Babies grow out of these very quickly and you can find tons of used baby clothes, toys and furniture in great condition for a fraction of the price you would pay at a retail store.

Make sure you wash the toys and clothes and wipe down the furniture well before using. Wash baby clothes with hot water before using on baby.

To clean plastic toys, fill the sink with hot, soapy water and place the toys in until the water cools.

You could also add a splash of bleach, but rinse the toys before drying. Wipe the toys down and let them dry before using.

Garage sales and consignment shops or stores are great places to find great bargains on baby stuff.

You can even ask another parent with a child a little older than yours if they wouldn't mind handing down their babies clothes when they grow out of them.

You could give them a few dollars if you would like and you would still end up saving money.

One of my favorite children's consignment shops is called Once Upon A Child.

They only sell high quality items and they charge around half of what the retail stores would have charged for the item when it was new.

Have You Started Saving For Your Child's College Education?

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This article is accurate and true to the best of the author’s knowledge. Content is for informational or entertainment purposes only and does not substitute for personal counsel or professional advice in business, financial, legal, or technical matters.

© 2012 Melanie Casey


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