Finding the Money for a Baby

by Stacy Francis, CFP®, CDFA

A new mom the second time around, of course I run into many other new moms. Despite the lack of sleep, they’re all so radiant and happy. However, when they learn that I am a financial planner, a different emotion often surfaces - the feeling of being completely overwhelmed with new responsibilities. For most of us, it takes years and years to find the perfect father for our future child. We also tend to factor in safety and the quality of schools when shopping for our first home. Yet most of us fail to prepare for the financial impact of the new family member. Below are a few things you can do.

  1. Get the appropriate medical coverage. Make sure pregnancy checkups, birth, and hospitalization are covered. Of course, when your baby arrives, you need to add him or her to your policy.
  2. Acquire disability insurance before you try for a baby. Just in case, something should happen, you are covered.
  3. Find the right work-life balance. If your partner’s paycheck is big enough to support all three of you, you may want to take some time off to bond with your newborn. If you have flexible schedules, you may be able to take turns caring for him or her.
  4. Sort out childcare. This is an area where a bit of research can make all the difference. Between nannies, pre-schools, co-ops and other options, both quality and price tags vary widely. Don’t forget to take the dependent care credit on your tax return too!
  5. Cash in on your tax breaks. With the Child and Dependent Care Credit, you can save a bundle.

Stacy Francis, CFP®, CDFA

Stacy Francis is the Founder, CEO and President of Francis Financial, Inc., a Wealth Management and Financial Planning firm. With over 18 years of experience in the financial industry, she is a CERTIFIED FINANCIAL PLANNER™ (CFP®), a Certified Divorce Financial Analyst™ (CDFA™), and a Certified Estate Planning Specialist (CES™). She is the Co-Director of the Association of Divorce Financial Planners’ (ADFP) Greater New York Metro Chapter and a member of the Women Presidents’ Organization (WPO) and an honoree member of the Private Risk Management Association (PRMA). A nationally recognized financial expert, Stacy has appeared on ABC News, CNBC, CNN, PBS Nightly Business Report, The Today Show, Good Morning America, Fine Living Network, and The O’Reilly Factor. Stacy attended the New York University Center for Finance, Law and Taxation.