How much does it cost to raise a baby?
Having a child is one of the most important events in a person’s life and most times it's a beautiful and joyous occasion. Some people plan extensively before they have a child, others simply go for it and figure out the details later. Which is the better way to do it? To each their own, but thinking through at least the financial implications of having a baby can help reduce your stress when the baby comes along and make you feel more prepared. So how much does it cost to raise a child? According to the recent data, raising a child from birth until he or she is 17 years old on average costs 233,000 dollars. Luckily, the expenses are spread out over a 17-year period, but you should still be prepared for the steep cost of having a baby.
Cost of child care
Child care is one of the biggest expenses young parents have to face. In some areas of the country, the cost of child care can reach 1,000 dollars a month and the sum is even bigger for infants. To avoid surprises, check out daycares before getting pregnant or soon into your pregnancy to avoid unpleasant surprises. It’s a good idea to find the daycare that suits your needs and budget before your baby is born. In some states, you can get tax deductions for child care expenses, but the daycare has to be officially licensed.
Maternity and paternity leave after having a baby
Most parents try to take at least some time off work when they have a new baby. This can put an unexpected burden on some young parents’ finances. Even though the US does not have maternity and paternity leave mandated on a government level, it doesn’t mean that you can’t expect to receive any pay when you’re on your maternity leave. For instance, some employees are covered by short-term disability insurance that covers pregnancy. Under the terms of a typical disability insurance, you are entitled to take about 6 weeks off work after the birth of your child and receive about 60 to 70 percent of your usual gross income for this time. This can be available for both the mother and the father of the baby.
If you’re not covered by disability insurance, check with your employer whether you’re entitled to time off under the Family Medical Leave Act. Most people are eligible for time off under this act, but the employer is not required to pay you during this time.
Check your healthcare plan before having a baby
Having a good health insurance policy is extremely important when having a baby. Giving birth costs thousands of dollars, and new babies require a lot of medical care even when they are healthy. Look at your deductibles and copays and estimate how much money you will need to pay out-of-pocket for doctor’s visits during pregnancy, labor and follow up doctor visits with a doctor. Additionally, consult your insurer about the cost of adding another dependant to your plan and if you get health insurance through an employer, compare the terms for different plans to find the best one.