To begin with, a baby in the family is nothing less than an addition to the number of members in the family.This translates into a bigger budget than expected. The amount of care and nurturing required by them is absolutely incongruent to their tiny size, so don’t get shocked over your budget the first month of delivery. While providing their children with the best of facilities, parents often burn a humongous hole in their pockets due to lack of financial planning and budget discussions.
Needless to say, if the finances are not managed mindfully and the budget not planned meticulously, this new addition will adversely affect the finances. Thus, managing expenses and ways of spending should be well discussed and preplanned by the partners well in advance. A set budget must be drawn beforehand and there must be mutual efforts from both sides to not exceed the limits. This budget must be altered according to the number of members earning an income.
Mentioned below are few tips which can be put to use to ensure optimum nurturing alongside a budget that promotes intelligent spending.
1. DO NOT compromise on the essentials
Before I begin listing down ways of cost cutting and mindful spending that is in sync with your budget, it is of utmost importance to understand that certain essentials in your budget can not be compromised upon. Necessities such as diapers, regular health checkups, nutritious food supplements are areas which should not be disrupted. Those these commodities are not exactly budget-friendly, your budget has to be friendly to them for it is necessary to ensure your child gets the best of these for a healthy and happy childhood. Understanding what a need and a want spell like in your budget make you more financially conscious. Do not compromise on the need, indulge on the want from time to time.
2. DO NOT over pamper
Parents often resort to pamper their children which result in nothing but spoiling kids and the budget target. Buy them gifts, give them toys, but know when to stop, know that there is a saturation point and heed the warnings of the budget you must have created beforehand. Parents often give into their child's wails and cries and end up buying them whatever they demand. However, there are other ways of showing love and making the child feel special. It is okay to tell them if something is expensive and not worth it. Introduce them to cheaper alternatives to fun and games. Take them to the park instead of playing games on the iPad. Entertainment has to occupy a small part in your budget.
3. Plan your savings well in advance
As soon as the news of pregnancy is broken, it is suggested that parents discuss their future savings and spendings in their budget. Remember that your monthly budget plans will not be the same as before. A baby fund could be started from the time the mother conceives, do not let your budget wait until the delivery. Monthly savings can be added to this fund which would prove to be beneficial in the long run. Make sure this baby fund is separate than your normal savings and is only used after childbirth. The only place where you can make a note of all this is in your budget. It is recommended that this fund is kept aside to be used only in times of emergency or when managing expenses in your budget get too hard. Also, parents must inculcate the habit of tracking down the spendings and keeping a record in their budget. Your budget will help in analysing your spending pattern over the months.
4. DO NOT hoard clothes
Owing to their constant growth spurts, children often outgrow their clothes in no time. Thus, it is suggested that you keep buying clothes as they grow up instead of preplanning and buying a bunch in advance as this may also pile up your budget unnecessarily. Also, while preparing the birth kit, one must opt for unisexual colours and clothes so they don't go to waste if they are gender specific. Your budget at this juncture should be all about commodities that are durable. Allocating your budget on buying extremely expensive clothes is discouraged as the child may not get to wear them more than a couple of times and they may feel the fabric to be uncomfortable. Similar is the case with their shoes. Instead of letting your budget for a toss on expensive leather shoes, sandals, etc, it is smarter to opt for cheaper and more comfortable alternatives like booties.
5. Get a Term Life Insurance Policy
Your budget is not only about the money getting spent, your budget is your how-to guide when it comes to finances. With a newborn baby, try to ensure that your budget guides on how to allocate your income. One definite way of utilising a portion of the money kept separate in your budget is to indulge in some weighty insurance policies. In the wake of unfortunate circumstances, the insurance will financially rescue your child.
6. Start updating your estates
Your budget does not live in the present, it breathes its life into future. A rough sketch of how your budget would like in the coming years is shown in how adequately planned you are in your finances. How do you spend the extra money in your budget? How many estates you have and who is the benefactor of those? In the wake of unfortunate circumstances who will be your child’s guardian? These questions do matter.
7. Double accessory furniture
Don't forget that your budget needs to make space for all the new baby furniture that will occupy your room- be it cradles or dressers. To maintain the requirements of your budget, ensure you choose furniture that serves two purposes. It could be a dresser table that can convert itself to a normal table or cribs that can be converted to toddler beds as per convenience. Hence you do not have to add up costs of two separate furniture to your budget.