When expecting a baby, many new parents worry about the ‘baby budget,’ and setting aside enough money for a new family member. From the diapers to child care, there are many expenses that new parents need to prepare for, and creating a stable budget will ensure that your family is well taken care of. Here are some budgeting tips for new parents to consider!
Evaluate Your Finances
When creating your own baby budget, start by evaluating your current financial state. Budgeting can help prevent frustration down the road. Take a closer look at your bank account, how much you have in savings, what your monthly expenses are, and where your debt payment stands.
Some folks prefer to look back on monthly bank statements and record transactions, while others utilize mobile or web apps connected to a bank account. The goal is for you to create a monthly budget that fits your family’s lifestyle, and this step will give you a solid foundation to build upon.
Increase Your Emergency Fund
When preparing your budget for a little one, increasing your emergency fund should be a high priority. This is a great way to ensure that you can cover normal and unexpected expenses if you experience unforeseen circumstances.
A good rule of thumb to follow is to calculate how much money to put away for your emergency fund, add the amount you have budgeted for your monthly expenses and debt payments, and times it by three. Typically, you will want 3-6 months’ worth of your true expenses and debt payments saved, so that you have enough cushion to get through a few months if you ever need it.
Anticipate Income Gap
If both parents are currently working, you may need to think about an income gap if one parent is on maternity leave or needs extended time off once the baby is born. If you do expect an income gap for a few weeks or months, then you can start putting extra money aside now. When the time comes, you will feel more confident and assured knowing you can pay bills and make purchases without straining your bank account.
We Are Here to Help You
At Blackhawk Bank, our Bankers want to help you create a stable financial future for your family, so that you can enter this new phase of life with confidence. Want to learn more about how Blackhawk Bank can help you? Contact us today!
VP Retail Sales Manager