So you have waited the requisite three minutes and now there are two pink lines staring back at you. You’re pregnant. You may be going through different emotions at this point ranging from both elation to being plain scared.
Many people start to freak out about how they are going to afford having a baby, which if you haven’t thought about the good news is you have 9 months to prepare.
How much does it cost to have a baby?
This is going to differ for every family based on income, where you live and what your lifestyle is like and whether you are going to maintain it.
In 2009 the Federal Government did a study which estimated raising a child to 18 years of age will cost an average of $384,543 although other experts have put the figure at 1 million dollars when you add things like pregnancy, tutoring, extra-curricular activities and the fact children stay at home to an average of 24 years nowadays.
Prepare during pregnancy
Some people may have started preparing before they become pregnant, but many will not. You have 9 months to figure it all out.
The key is to not make this time stressful but it is always better to be prepared. First figure out what health insurance you have and what it covers. If you are not already pregnant try and find a health insurance plan which will include coverage for all aspects of having a baby (there is usually 12 month waiting periods so the earlier you do this the better).
Try and find out early on what out of pocket medical expenses you will have to pay. Also look at what your policy offer in terms of infant care and coverage.
Live on a single salary
Most mothers (and some fathers now) take time off work to care for a baby. Try and see whether you and you partner can live off a single salary during your pregnancy. Not only will it give you a bank of savings but it will also give you peace of mind that you can manage it.
This extra money will also give you a great head start on eliminating any debts you may have. The sooner you can get rid of them the less stress you have later on. Also put a small portion of this money into an emergency fund in case any unforeseen things happen.
Find out what government assistance is available
If you are working you will have some type of maternity or paternity leave available. Also investigate your eligibility for Government assistance such as the Baby Bonus or Parental Leave Pay. You may also want to look at options for child care or family assistance and whether you may qualify.
If you plan to return to work start investigating the costs of child care vs nannys or aupairs and what facilities are available in your area.
Start an education fund
If you plan on sending your kids to private school at some point you may want to start a savings fund now.
Private education can cost up to $30,000 per year for the most expensive schools. You do not want to have to be finding that kind of money when it comes up especially because it is likely you have taken on bigger expenses such as a larger house or different cars. You may also at this point have had more than one child.
If you can start this now it will relieve the burden later on.
Make a baby budget
Use your 9 months to research and make a realistic budget on the costs of having a baby. You need to think about formula, diapers, furniture, medical bills, clothing and more for the baby.
If you are on a tight budget look at second hand items you can purchase or hand me downs that families and friends might have. Babies grow fast so they will soon outgrow many of the things making it pointless to spend thousands of dollars.
You may be spending less on commuting and work clothes if you have not returned to work but you may be using more in terms of electricity, gas and water. It is likely you will make changes in other areas to accommodate extra costs but budgeting for it now will take away stress when the new born arrives.
Factor in your partners income, any maternity/paternity leave payments and any government assistance and be realistic about when you plan to return to work if you will at all.
Revisit your insurance and will
Having a child is an important time to re-evaluate your personal insurances and make sure you have enough if something were to happen to one or both of you. You should also make a will if you haven’t already and make sure that guardianship factors are included for your baby.

Founder, Savings Guide
Personal Finance Blogger
Alex (A.J.) Wilson is the founder and head personal finance writer of Savings Guide (a registered Australian company with ASIC).
Alex has 12+ years of experience commenting on personal finance in Australia with major media publications including Sydney Morning Herald, News.com.au, The Daily Telegraph, The New Daily, Your Mortgage and more.
Alex is regularly featured on Channel 9, Channel 7 and ABC Radio as a leading consumer advocate.
Holding a degree from the University of Sydney (UTS) in Communications and Information Management, Alex is based in Sydney Australia and works full time while simultaneously running Savings Guide to help Australian’s make smarter personal finance choices.
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