Trying to prepare for parenthood financially can be overwhelming because you don’t know what you’re going to need in your budget. Not all families are the same, and your children may have different needs. The best thing to do is start saving right away and lay out the different expenses you will need. Below are five things to consider.
1. The Budget
Before you become a parent, you need to establish a budget that will help you with savings and make you financially prepared for parenthood. This budget should allow for 50% of the income to go towards bills and monthly expenses. The next 30% should go to your daily expenses, shopping, and other household things that are needed. Finally, the remaining 20% should be devoted to your savings to prepare for your future children.
2. Prepare for IVF or Surrogacy Costs
If you are having trouble conceiving a baby, then you may need to embark on in-vitro fertilization treatments. Depending on your situation, you may need multiple treatments and medications to help make the egg conceive. Your doctor will give you a quote on what you can expect so that you can budget for these expenses.
You may find that you can conceive but not carry a child, then you will need a surrogate. The cost of surrogacy is based on several factors and varies for each family. These factors include needing an egg donor, the personal expenses of the surrogate during the pregnancy, how many children the surrogate is carrying at once, and the medical needs that arise during the pregnancy.
3. Private or Public Education
School tuition is a big expense that parents have to consider in their budget, and this can be between public and private education options. In the last decade, there has been a push for more students to attend private schools at the K-12 level and later on. Private schools are readily available since they make up 25% of the country’s elementary and secondary schools.
A Montessori program may be the right call if you consider private school. They have made up a big percentage of the private school sector in the last decade and have a curriculum that is proving to yield results. However, public schools in different areas are also showing signs of high achievement, so the call is really yours to make in the area where you live.
4. Special Needs Programs
More children are being diagnosed with special needs, and there is a possibility that you will need to take advantage of special needs programs. These aren’t bad things, but they work better with preparation. According to the CDC, approximately one in 36 children have autism spectrum disorder (ASD). These disorders do require special programs and therapies that may or may not be covered by your insurance. It is better to be financially prepared for them.
5. Daycare Costs
After having your child, you and your partner may be planning to return to work. If that’s the case for your family, daycare costs must be considered and planned for. For one child, daycare costs could cost you several hundred dollars a week. This expense will cost multiple children thousands of dollars a month until they start attending school.
While you can estimate the costs of these different things, they could change based on the number of children and your preferences for different programs and education. If you move to a different area later on, you could find that you have different preferences that impact your budget goals. Either way, these are good guidelines to consider when preparing your budget and knowing what you’re saving for.