Financial considerations when having a baby

It is estimated that you will spend up to 20% of your income on child related expenses, regardless of how much you earn. As your baby grows, you will find the costs continue to increase and of course your commitment will not end for many years to come.

Many families will drop one income completely for a period of time while others will have the added costs of childcare if both partners return to work. Be aware that this loss of income can cause stress in many relationships, particularly with the added pressure of a new baby. One way to alleviate this stress is to take the time to discuss how you will manage your financial situation once you have a baby.

Recognising the added costs new parents face, a government benefit is available to those couples who need assistance. To find out more, contact Centrelink on 13 13 05.

What does a new baby cost? 
Below are just some of the costs associated with a new baby.

Private health cover
While private health cover is optional, many couples trying for a baby will choose to take out private cover.

Housing
You will need to assess whether your current home environment is suitable for a baby. If you are sharing a house or living in a one-bedroom apartment for example, you may find this too cramped once you have a baby. If you think you need to move house, then plan to do it either before you fall pregnant or in the early stages of pregnancy to ensure you have time to settle and not feel pressured by the baby's imminent arrival.

Transport
Many parents will consider switching to a "safer" or more suitable "family" vehicle once they have a child. Obviously, this is an optional choice but if you currently drive a two-door sports car for example, you may find it a bit more awkward getting a baby capsule in an out.

Furniture and equipment
You are going to need some basic items such as a cot, stroller and baby capsule for the car.

Of course, beyond these three basic items there are plenty of other items that you may choose to purchase, including a changing table, baby bath, portable baby chair or bouncing chair and baby sling just to name a few.

Before you go crazy buying up the local baby store, however, remember that these items can often be purchased second hand (visit The Essential Trading Room for second hand goods) or borrowed from family or friends.

Clothing and Accessories
Many couples receive lots of clothing, baby wraps, cot sheets, towels and booties after the babies birth, but you must remember that this baby is going to keep growing - usually fast.

Borrowing clothes or buying second hand is an option, as is buying from discount stores but no matter what, you will find your baby constantly needing new clothes.

Childcare
Research the cost of childcare centres in your area to determine the cost of returning to work. If you are lucky enough to have willing family nearby, you may find that you can get some free childcare assistance but most new parents are not that lucky.

Be aware that depending on your income, the cost of placing your child in day care can sometimes eat into the majority of your wages.

How can you reduce the cost of a new baby? 
Below are some suggestions for cutting down the costs associated with your new baby;

Borrow
Furniture, prams, clothes and nappies from friends or family members.

Buy furniture, prams and clothes second hand
Visit The Essential Trading Room for a selection of second hand goods in your area.

Use cloth nappies
While the workload associated with cloth nappies is much higher, they are far cheaper than using disposables. Alternatively, compromise by using a combination of both disposables and cloth nappies. Some mums find it much easier keep some disposables on hand for outings to make life a little easier

Breastfeed
If you are able to breastfeed, it is better for your baby nutritionally and emotionally. It is also cheaper as you will not have the added cost of formula, bottles and sterilisation equipment.

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