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Having a Baby This Year?

Here's what it will likely cost you


We’re right in the thick of baby season! July through October continue to be the most popular months for births in the United States.

Meanwhile, the cost of raising a child continues to climb. The U.S. Department of Agriculture estimated that raising a child born in 2018 costs $233,610 – and believe it or not, that excludes the price tag of a college tuition.

A little budgeting and planning can help alleviate the financial stress brought on by having a new bundle of joy.

Here are some strategies to keep in mind:


How will your finances change after the baby is born? Is either parent taking paid time-off from work to care for the baby? Review your current household budget to make sure it remains up-to-date and be sure to add estimates for immediate newborn necessities such as diapers and food. Having a general idea of monthly expenses and income will result in more effective planning.


It is important to have health insurance in place to cover medical expenses you will incur during pregnancy, delivery and post-natal care. Know exactly what your policy covers and don’t hesitate to reach out to your insurance provider with questions. Adding life insurance is something to consider for new parents as well. Consult an insurance professional to discuss what plans will work best for you.


It’s easy to fall into the trap of putting off saving for the future when college is almost two decades away for your little one, but with the cost of schooling rapidly increasing, it’s critical to plan early. How much to put away really depends on the individual family and the family’s situation. Some families may only be able to help a little, in which case the college student will have to look at taking out some loans. Other families may be able to pay for tuition but have their child pay for books, or even room and board.

If you start early, you will be shocked to see how quickly that money grows once you allow it to compound for 18+ years. $100 a month is a good place to start. Many families should be able to squeeze that much out of a monthly budget, especially considering it’s about the equivalent of a family of four eating at a fast-food restaurant a couple times a month. Additionally, I would recommend setting up automatic withdrawals. For just $100 a month may sound like a lot to begin with, but when it comes out automatically and routinely, you will be surprised to find you barely even realize it’s missing.


Most babies grow quickly, their outfits barely have time to get worn more than two to three times. Taking in hand-me-downs from friends and relatives who already have children could save you a significant amount of money. Allow yourself to splurge occasionally, if your budget allows, but keep in mind the bigger goal of saving money for something more important – like your child’s future.


Ask friends and family members who’ve experienced caring for a new baby what they would deem baby necessities versus some of the extra things that may seem neat or necessary but really are not.

There is plenty to prepare for when expecting a child – from buying the right car seat to designing the nursery. It is also important to prepare financially. Whether your baby is due this summer or you and your significant other are considering having children soon, the experience will be that much more joyful if you have your financial ducks in a row.


Sara Fox is a Financial Advisor with the Global Wealth Management Division of Morgan Stanley in Loveland. She can be reached at 970 776 5506 or Sara.Fox@morganstanley.com.

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