Maybe you mapped out your personal finances before you decided to start a family. Or maybe you ran the numbers after you were already expecting. Either way, as you prepare for the arrival of a new baby, you’ll at some point need to think about expenses and saving.

According to the United States Department of Agriculture, a middle-income family will spend roughly $234,900 to raise a child born last year, or $295,560 if you factor in inflation. So when planning an addition to your family, you may want to keep in mind these financial dos and don’ts:


  • Start building a cash cushion. It’s always smart to have an emergency fund containing several months worth of living expenses – but the unpredictability of child-rearing costs makes the need for a solid emergency fund even more important, according to financial planner Laura McMahon in USA Today. (Ally No Penalty CDs, with competitive interest rates and penalty-free withdrawal, can be a smart place for your emergency fund.)
  • Review your insurance coverage. In terms of health insurance, parents need to make sure that their current coverage will be enough to cover a new family member, McMahon tells USA Today. Plus, parents need to make sure they have adequate life insurance, recommends financial planner (and new daddy) Jason Close in USA Today. Once children come into the picture, parents need to make sure there’s enough income, should something happen to mom or dad.
  • Start saving for college. A college education will be probably be one of the biggest investments a parent can make. So the sooner you start saving for it, the better, advises USA Today. “By starting to save when a child is born, or even before, parents can dramatically reduce the financial strain of the process,” the newspaper says.


  • Be afraid to second-guess your obstetrician. “If your doctor orders a test or procedure you aren’t sure your insurance company will cover, ask your doctor about your options,” advises MoneyNing. The site adds that some routine procedures may be unnecessary and skipping them can save you money.
  • Simply throw together a baby registry. You’ll want to put in careful consideration, notes Fox Business. They point out that to save money, you’ll need to ask yourself some questions: Will you have an actual baby nursery or just a dedicated space?  Will you be using formula? Will you be traveling with your baby often? The answers to these questions can help you build your registry.
  • Be shy to ask other parents for money-saving tips. “You may be surprised to find that many of the things you thought you needed are a waste of money,” says MoneyNing. “On the other hand, you may also find great tips that could save you a bundle.”

How do you save money when preparing for a new baby? What lessons have you learned about being cash-smart when it comes to children?