Finding out that you (or your partner) are pregnant is a special moment. It’s exciting to think of the future, but it can also be slightly scary. The unknowns are plentiful, so it’s a good idea to try to plan as much as you possibly can. Now, there’s no way to prepare for dealing with a screaming baby at 2:45 a.m., but there are some ways to prepare financially for that baby’s arrival. Below are some tips.
Adjust your budget and savings.
Take a look at your monthly budget and see where you can trim the fat and boost savings. Take some of those extra dollars and set them aside in a baby fund, which can hold money for things like a crib, diapers and a stroller.
Get ready for college.
We know it’s crazy to be thinking about college before the baby is even born, but trust us on this one: It’s time to open a 529 plan for your little one. A 529 is always federal tax-free, and usually state tax-free if it’s used for college. Also, as Time explains, if your child ends up getting a scholarship, you can transfer the money to another kid in the family. Yes, now we’re planning your second child.
Check out the many options for life insurance. If you’re a young parent on a budget, you might want to check out a term life insurance policy, which offers a specific death benefit that is enough to cover the family’s financial requirements.
Don’t forget about yourself.
It’s easy to get caught up in your baby’s needs, but don’t neglect your own future. Specifically, make sure you’re keeping up with your own retirement plan.
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