The Financial Roadmap while Planning For a Baby

Making a baby is a momentous decision in the life of would-be parents. It is therefore not without reason that nowadays people talk about planning for a baby. Planning, per se, includes the entire range of activities from financial to emotional. Good planning and execution of such ideas can be the best gift for the child to come.

Financial Handholding

Just as parents hand-hold children to guide them through their first few steps, let the following discussion act as a financial handholding process for planning the financial aspects of child bearing and rearing.

Get a Health Insurance Cover

Medical costs are perpetually on the rise; hence a good medical insurance cover is something that would-be parents need to actively consider. It is of utmost importance that both the parents are healthy and fit to bring the child into this world. Medical checkups are a necessity at every stage from pre-natal to post natal phase and later, hence it is a wise decision to opt for a comprehensive medical insurance policy which covers all pregnancy related costs, maternity costs up to delivery and later and also medical care costs for the new born.

Review of existing policies

It is imperative that the parents already have existing policies that cover different aspects of life. Before the child comes into the world, it is necessary to review the existing policies and re-work on the covers required. It is always advisable that insurance covers for all eventualities like health coverage of child, life insurance cover for the spouse in the event of their death and disability insurance for taking care of loss of income in the unfortunate circumstance of accident or illness of parents are all considered as a pre-cautionary measure against all situations.

Adjusting the Lifestyle

With every passing day there are more working couples venturing into parenthood. Double income couples become used to a lifestyle before the baby is born. Parenthood brings new challenges and expenses, which have to be borne within the same disposable income. This change may cause foregoing certain luxuries, which were easy to indulge in earlier. Cutting down on the number of eat-out ventures, purchasing clothes, accessories and gadgets could be the right step in this direction.

Checking for Maternity/Paternity Leave Benefits

Most organisations grant fixed maternity leave to lady employees while some also provide for paternity leave. It is important to take stock of all available leave lying in your credit and also check the maternity/paternity leave policies in the organisation. Pregnancy will call for a lot of pre-natal check-ups to be carried out on would-be mothers and this will entail a visit to the doctor for which leave might be required. Maintaining adequate sick leave and paid leave balances will help during such situations.

Plan Ahead

Planning ahead is always a good idea provided the plans are backed up with commensurate action and execution. Life throws up many surprises and it is not possible to predict exactly when and how it might appear before us.

When planning for a baby it is a prudent decision to set a target date regarding higher education, marriage or any such expenses, which need to be incurred for the baby in the long run. Estimating the amount, which might be required and saving accordingly is a key to good financial practice. An insurance policy catering to the specific target could be taken up so that the best returns are achieved after the term runs its course.

However morbid it might sound, planning for death or sudden disability for self and spouse can provide peace of mind. Parents can be sure that in case something untoward happens to them the family per se is covered financially and will be able to cope with such mishap.

Build better money management habits

Managing money are more of a habit than skill. The great Warren Buffet has a very effective reverse logic to the concept of saving. What he suggests is –spend what is left after saving, meaning that the savings is certainly preferred over spending. While one might not be able to follow this logic in absolute terms, trying to save as much as possible is definitely a sound money management habit.

Creating a budget, reducing expenses and monitoring cash flow will necessarily result in savings. Putting this system in place before the baby arrives will make life less stressful.

Will

In the unfortunate event of death of both parents, the child will be left without someone to look after him. Assigning a guardian to look after the child in such eventuality will ensure that the courts do not have to step in to decide the child’s future. A will is something, which can be a very useful document in such circumstances.

Stem Cell

In this age of technology, a very useful option of preserving the stem cells of children is available to parents. Stem cells can treat various illnesses and lifestyle diseases, and preserving stem cells becomes important if the family has a history of certain diseases, like Leukemia. After deciding to go in for stem cell preservation it is upon the parents to choose the right stem cell bank and arranging the money required to meet the cost of preserving the cells. The expense, though worthwhile entails outgo of a large sum of money and hence parents need to plan properly for such expense. It is a good option for parents to choose between one-time payments or availing a monthly instalment scheme. 

Conclusion

It is expected that couples planning to have children and even those who plan to adopt a child will find this discussion helpful as a lot of facets as discussed above would be applicable to both situations. At the end of the day bring a healthy child into this world and rearing him or her to become a good human being is what every parent yearns for. Hope this little bit of handholding will help them in their quest.