Monday, February 18, 2013

Think of the Savings: Financially Preparing for a Baby

Over the weekend, John and I took a field trip to the big box baby stores to look at some of the big ticket registry items in person. Mainly the stroller, car seat, carrier, and high chair. Armed with recommendations from friends and the Tyckled Tales baby checklist, I thought we could make quick work of the trip and zap a few things onto our registry.

Well....the registry is up, but there's nothing on it. (Doh!)

Turns out, walking through the store and creating a registry can take 2 to 4 hours! (Gah!) And I'm a horribly indecisive person. So I'm going back and meeting with a "Registry Consultant" to finally put things on the registry. Since John and I already decided on the biggies, he doesn't want to be there when I have a meltdown about the merits of different pacifiers. I already had a mini freak-out that not knowing which co-sleeper was better meant I wasn't ready to be a parent. Yes, completely irrational. But then I cried a little (thanks hormones!), read some of MODG's baby gear posts (honest and entertaining), and felt much better. For one, she had and hated the co-sleeper we struggled with at the store.

Getting ready for a baby is reminding me more and more of planning for a wedding. It's an extremely emotional process (with bonus hormones). The baby industry is willing to sell the latest and greatest item for your child at a premium because "don't you want the best for your child??" It's similar with weddings because "it's your big day." Plus, there's a period of time when it's a little too early for planning and then the urge to nest (or pick out wedding flowers) creeps up on you and Holy moly, I need to do everything nooooow!

Fortunately, we've been financially preparing for our baby girl, some before she was even a twinkle in our eyes, which makes me feel better about her arrival:

I got a new job: The hours and salary are much better than my previous job in public accounting. Plus, the commute is shorter, so I won't be as far away if there's an emergency at day care.

We refinanced our mortgage on a house well within our means: We're pretty close to the breakeven point of recouping the fees, so refinancing a year ago was obviously a good decision. Even if we only made the required monthly payments over the 30-year term of our mortgage, our savings are about $51,000 compared to our first mortgage.

We could refinance again, but have decided to make additional principal payments on our mortgage instead: We were already paying $100 more towards principal each month on our first mortgage. If we paid the same amount each month after refinancing (in essence, $236 in additional principal payments), we have the potential to save almost $63,000 over the term of our mortgage. But we've decided to be ambitious and throw extra money towards the mortgage, lowering overall interest payments and the length of our mortgage. Once our baby girl is here and we have a better idea of our new monthly expenses, we'll reevaluate our monthly mortgage payments as well as other expenses.

We got life insurance: Both of our employers offer a group term life insurance policy, but it's pretty tiny compared to what we would need if something were to happen to either of us. Discussing life insurance is a few posts in and of itself, so look forward to more information in the future.

We've talked about putting together a will: Nothing like the upcoming birth of your child to think about your own mortality. This is still an item to tackle on our "to do" list.

We talked to real people about baby necessities: As alluded to above, the registry checklists at the big box stores have way more stuff than we'll actually need and use. Real-life parents have shared recommendations about what actually works so we can minimize some of the crazy baby expenses and clutter. This also helps cut down on excessive researching.

That being said, we're still doing our research and planning/budgeting accordingly: As of now, I'm planning on going back to work, so we're checking out day care options in our area. [Hint: the Quality Counts Online Child Care Search is a great way to find Illinois DCFS licensed day care centers and homes for those in Illinois. There are probably similar search resources for other states.] Day care will affect our diapering decision (disposable vs. cloth), though I know cloth is a big money saver. And I'd like to breastfeed because of the great health benefits with the bonus cost-savings.

Finally, we're borrowing, buying used, and registering for baby items: A big thanks (and advanced thanks) to family and friends who are helping keep our out-of-pocket expenses down! You better believe we'll also be checking out garage sales and the twice a year consignment sale at a local school.

If you're a parent (or parent-to-be) how have you "thought of the savings" when it comes to kids?
Pin It


  1. Our recommendation - skip the changing table. We had one and never used it (other than as a shelf). The changing table never felt that sturdy, and it was just too cumbersome to change the baby there when a bed or floor was much more convenient and easier to work with. We'd recommend one of those cubeicals (sp?) from Target or Ikea instead and fill the bins with diapers, blankets, etc. Looks just as nice, lasts longer, and is much more useful, in our opinion - and no more expensive than a changing table. Good luck!

    1. Mike and Jenny - Thanks! We have a long, low dresser that we plan on also using as a changing table. And I'm sure we'll be changing diapers throughout the whole house!

  2. Some lenders will do no-cost refinances. I would consider looking into those. I would also investigate if your lender will let you recast the loan - that could be helpful if you end up not going back to work for whatever reason.

    Good luck with paying down your mortgage - I'm doing that pretty aggressively myself.

    Congratulations on the pregnancy!


Thanks for your comment! Keep in mind that Fiscally Chic is a spam-free zone. Please leave your snarky comments, blatent self-promotion, and processed meats at home.

Related Posts Plugin for WordPress, Blogger...