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How to Save Money With a Baby

Your new little baby will bring you tons of joy, but you also need to know how to not blow your budget.

Making the change from an adult only household to one with a new baby to take care of can be a big financial undertaking.

There are ways to reduce expenses, reduce debt and save money that will reduce some stress and worry. We all want to enjoy all the special moments that becoming a parent will bring and not worry about not having enough money.

26 Ways to Save Money When You Have a Baby

1. Anticipate Additional Costs

Use this list as a guide and take the time to write down the many ways that the new baby will affect your finances. Making this your first step will allow you to make sure all corners are covered.

2. Budget During Pregnancy and After Delivery

Your new little bundle will require a lot of love, affection, care, and plenty of added expenses. Take a walk through the baby department at the store and make note of how much the necessities will cost. Maybe even consider adding things like diapers and wipes to your weekly shopping list now. This will not only give you a stockpile for when the baby is born, but it gets you accustomed to adding these extras to your weekly budget. Don’t forget to adjust your food budget. If you choose not to breastfeed, you will need to purchase baby formula. Certain brands and types of formula can be quite costly.

3. Decide on Childcare

Having childcare in place before your baby is born will be one less thing to worry about when the baby arrives. Decide ahead of time if a relative will provide the childcare or if you will hire an outside provider. This will also affect how much you will need to budget for childcare expenses. Many relatives will provide childcare for much less than an outside provider. Always visit childcare facilities and interview providers. Make sure providers are insured, with references, and all clearances. Finalize your childcare arrangements when your baby is born by taking him or her to visit the new provider you have chosen.

4. Get Disability Insurance

Disability insurance is a must have for a family. Some employers offer disability insurance. You should have enough coverage to cover quite a few months of unemployment. Don’t forget to periodically update your living expenses as they will change from year to year.

5. Have an Emergency Fund

Having an emergency fund in place is recommended for anyone, but a necessity if you have children. When you have children you learn to expect the unexpected. Having at least enough saved up for 6 months of expenses would be ideal.

6. Check for Adoption Fees Help

If you are planning to adopt, you need to calculate adoption fees and work them into your budget. Research grants and loans to find out what may be available to help cover adoption costs. Some employers now offer benefits to help cover some of these fees. Also, active duty military members are offered a partial reimbursement after the adoption is finalized. If you decide to take classes this will need added into your budget. Taking classes is a decision that is very personal and will vary from person to person. Childbirth, breastfeeding, and parenting classes aren’t exactly necessary and are an added expense. Check with your insurance company to see if any classes or education is covered. Many insurance plans may cover some form of breastfeeding and childbirth education. Decide what classes, if any, you will attend so you can plan your budget accordingly.

7. New Expenses as They Grow Up

There will be financial considerations to think about as your child grows up. Will you have more children? Is there going to be a need for a bigger home or vehicle? What activities or sports will your child participate in? These things might not have an immediate impact on your finances at the moment, but it is worth thinking about them ahead of time.

8. Home Preparation


Certain safety measures must be taken to ensure your home is safe for a little one. Older homes may have hazardous lead based paint. Replacing worn window screens, adding cabinet locks, outlet covers, and anything else needed to ensure the safety of your child will need to be added to your expenses.

9. Know What Insurance Covers

One of the first things you should do after finding out you’re pregnant is learn what your insurance covers. Having a baby is expensive. Anticipating how much you will be responsible for is the first step towards a pregnancy and baby friendly budget. Find out what services are covered during and after pregnancy. You should also plan for any co-pays so that those may be added to your financial plan. If both parents have insurance through their employer, and are to continue working after the baby is born, then you should decide ahead of time which plan the baby should be covered under. Weigh your options carefully. You will also need to add your baby to your insurance after he or she is born. Most insurance plans require that you add your baby within 30 days of birth. A few give you up to 60 days. It usually doesn’t require a lot to add your child to your plan. It can easily be done the first week after the baby is born. This is something that will need done before you’re caught off guard with an ill, uninsured child.

10. Justify Goods Costs to Yourself

No need to go out and start buying designer baby clothes, diaper bags, and bedding. Buying the things your new little one will need is undoubtedly something every expectant parent looks forward to. But, if you’re not careful it will be very easy to get carried away and destroy your budget. Big ticket items like cribs, strollers, and car seats will sometimes be available as hand me downs from relatives or friends. Always check to make sure these items are safe if they have been used. Older cribs have safety issues pertaining to the space between the rails, and car seats have expiration dates.

11. Know Your Financial Limits

Now is not the time to be racking up credit card debt. Stick to your budget and use cash if at all possible. Allot a certain amount for things that will cost the most and don’t go over that amount.

12. Get Life Insurance and Add Beneficiaries

If you don’t already have life insurance, then now is the time to purchase it and consider adding your child as a beneficiary. If you have 401(K) and IRAs you may want to add your child to those as well. Since your child is a minor you will need to decide when and how your child will access the money from these accounts. Check with your lawyer about a will or trust fund. You may also want to consider purchasing life insurance on your child. There is no parent out there that wants to think about losing their child, that is why many parents are unprepared for it. Rates for these plans are usually low and very affordable. Gerber insurance plans are worth looking into as they have been around for almost 50 years and offer many products to meet your insurance needs.

13. Find Out About Maternity/Paternity Leave

Inquire about your employers policies regarding leave. Some employers require paperwork for leave to be filled out far in advance. Knowing ahead of time how much income will be available after the baby is born is of utmost importance. Experiment living off one income before the big day arrives.

14. Take Your Own Newborn Hospital Pictures

Baby Photos

Most hospitals take pictures of the newborns shortly after birth and offer the parents a portrait package. These portrait packages may be pricey. You may decide to purchase the hospital package, or you could make an appointment with another portrait center of your choice to have your baby’s first pictures taken. Many parents now do their own pictures of their children monthly. Search online for some creative at home portrait ideas. This will save you a bundle of money and allow you to personalize your pictures to your liking.

15. Order Your Child’s Vital Records

This will need done soon after the birth of your baby. Most hospitals provide a welcome packet that will have the paperwork you need to order the birth certificate and Social Security card included. If it is not in your welcome packet, or you give birth outside of the hospital, you can contact your county vital records department for information and the papers that you need to fill out.

16. Find a Recommended Pediatrician

You will want to have a pediatrician already lined up when your baby is born. Many pediatricians will see your baby for the first time while you are still in the hospital. Ask friends and family if they have a pediatrician they would recommend. Check online for area pediatricians and patient reviews. Make sure your new pediatrician accepts your insurance and is an in network provider.

17. Budget for Adult Time

Don’t neglect time for yourself. Remember to leave room in your budget for an occasional night out or a special family outing.

18. Contribute to a Retirement Fund

With the excitement of a new little life to take care of, you may forget about your retirement fund. You may even feel that retirement is too far away to think about. Life goes by quickly. It is never too early to start planning and saving for retirement. You want to make sure your golden years are covered so that your children won’t have the added financial burden of taking care of you.

19. Save Early for College

Starting a college fund for your child now will make their education much more affordable when the time comes. You may not be able to cover 100% of the education expenses, but it will be a big help. Check into a 529 plan that will have tax breaks and added tax incentives.

20. Review Your Taxes

Don’t forget to revise your W-4 form now that there is a new dependent in the family. Make an appointment with your tax professional to find out how your taxes will be affected and if there is anything else you need to do.

21. Look to Use the WIC Program

Find out what programs and resources your family might be eligible for. One very common program is WIC. This program will provide certain nutritious foods throughout your pregnancy and assist with formula and milk after the baby is born. Over half the babies born in the United States are eligible for this program. There may also be weatherization programs for your home and free parenting classes. Making use of what you are eligible for will free up part of your finances for other things the baby may need.

22. Managing Your Family’s Expectations

Family values can have an impact on finances. It may seem too soon to be thinking along the lines of public or private school while your child is still in diapers, but if you choose private school it can be a big hit to the finances. Anticipating and saving early on will help cushion the impact. You may also want to think about how family traditions might be affected by your new family member’s arrival.

23. Create a Will

Write or make adjustments to your will. You want to make sure that your child is well taken care of and provided for in the untimely event of your death. Choose and designate a guardian to care of your child. It is better that you choose the guardian for your child now, than to have your child taken into the legal system to possibly be placed with strangers. Make sure that your will is legally binding.

24. Budget for Music Lessons

You may want to fit lessons into your budget sooner rather than later if you wish for your child to learn a musical instrument. Many parents start their child’s lessons as soon as the child can walk.

25. Review Yearly Changes

Expect changes to occur year after year. Your financial situation will not look the same next year as it does this year. The economy fluctuates, expenses change, unexpected things happen. Keeping this in mind will allow you to cushion your bank account accordingly so that you’re not caught off guard.

26. Tackle Your Highest Debt

Keep an eye on your credit report. Pay off smaller, outstanding bills you may have lurking around. If you can afford to pay any extra towards loans and credit card balances it will save you money in the long run and help in the future if you need to finance a large purchase such as a home or car.


There are some simple ways to be more efficient with your income and expenses.

We wish you all the best with your new baby and all the happiness they will bring you.