How to Financially Prepare For a Baby

Baby Lying Near Dog Plush Toy Preparing for a baby is daunting enough, with so many things to buy and home preparations to make. However, if you have the added strain of being worried about your finances, this can overshadow your excitement surrounding the arrival of your new addition.

Preparing for a baby is daunting enough, with so many things to buy and home preparations to make. However, if you have the added strain of being worried about your finances, this can overshadow your excitement surrounding the arrival of your new addition.

Fortunately, it is never too late to start getting financially prepared for a baby, even if you are already on a tight budget.

Check your credit score

With so many expensive purchases to make, both before your baby comes and once they have arrived, you may find yourself needing to take out a loan or buy something on credit. If this happens, you need to have a good credit score, so that you can get the best possible rates.

You can check your credit score online using Experian or some banks will carry out one for you. If your credit score is low, try to improve it before your baby arrives.

Make a dent in your debt

If you have any debts that you are paying off each month, try to reduce this before your baby comes as then you will have more spare cash to spend on other things such as baby diapers and wipes.

For those who are already struggling to manage their repayments, you may want to consider a consolidation loan. Alternatively, some charities offer free advice on getting out of debt.

Create a baby budget

You are likely to need more money each month once you have had a baby, and, depending on your circumstances, you may also be dealing with a drop in income. By creating a baby budget, you can avoid getting into debt and make sure you have enough money to cover all your expenses each month.

You can create a baby budget using a simple Excel spreadsheet, or you can download a budgeting app online. When creating your baby budget, make sure you make provisions for any large items that you need to buy such as a cot and stroller. You can find some great deals on car seats at nunababy.com/au, which can help your baby budget to stretch further.

Have an emergency fund

If you still have a while to go before your baby arrives, it can be a good idea to start putting some money aside to help cover any extra expenses and reduction in income after your baby has been born.

Ideally, you should try and save between 3-6 months of salary so that, if something happens like you lose your job or your car breaks down, you have enough money to manage on.

Bulk buy essentials

Try to bulk buy as many essentials as you can before your baby arrives. This includes items for the baby such as diapers, wipes, and baby clothes, as well as household products such as toilet paper and laundry detergent. The more you can stockpile, the less you will have to buy once the baby arrives.

You may also want to ask family and friends to help you with this or ask for these essentials in place of presents at your baby shower.

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