Congratulations, your budget will change!
- Think increase in essentials, monthly medical expenses for a while, and starting a college savings account—now—so the money grows with baby.
- If it’s your first child, there will be gifts. Take advice from other parents about what you really need and don’t look negatively on hand-me-downs.
- Keep an eye on any opportunities to save (coupons, blogs, etc.).
- Deciding if a parent should stay home is a BIG conversation. There’s no one size fits all. Look at the financial impact and talk with your boss.
- Now that someone new is in the picture, update your estate. Include in a will everything needed to ensure your child’s protection should a tragedy happen.
- Don’t forget the tax incentive—extra tax exemptions, child tax credit, child and dependent care credit, earned income credit (if annual income is below a certain level).
- Preparing for the birth or adoption of a child is a fun and exciting time. Enjoy it, but keep in mind the financial changes that are ahead.
Source: Feed the Pig (AICPA Consumer Education)