As a money coach and more importantly, as a dad, I’ve steered through the financial ups and downs of raising two kids. I’m here to share some practical money tips for when you’re adding a little one to your family.
Start saving early
When I was expecting my first child, I began by looking closely at our family budget, finding places we could tighten up. Every euro we saved was a step towards a more secure future for our new arrival. Starting early gives you a bit more breathing room when baby-related expenses begin to crop up.
Emergency fund is key
I can’t stress this enough – having an emergency fund is crucial. It’s the financial cushion that softens the unforeseen blows that come with parenthood, like an unexpected doctor’s visit or a sudden need for a baby item we hadn’t anticipated. When my first child was born, having this fund was like having a financial safety net.
Be practical with funds
Babies need a lot, but they don’t need everything all at once. I quickly learned what was essential and what we could skip or buy second-hand. For both my kids, we focused on buying quality items that were really necessary, and we accepted hand-me-downs whenever possible.
Revist your budget
With both my son and daughter, our household budget needed revising. Diapers, baby food, and healthcare – these things add up. I made sure to track our spending and adjust our budget as needed, so we always knew where we stood financially.
Think about the future
Even though education is free in Malta, I wanted to prepare for other future expenses. So, I started a savings account for each child. It doesn’t have to be a large amount; consistent, small savings can grow over time and provide for your child’s hobbies, interests, or unexpected opportunities.
Stay adaptable
What’s true in parenting is true in finance – adaptability is essential. When my first was born, no matter how well I thought I’d planned, life threw curveballs. So, I learned to be flexible with our finances, adjusting as our family’s needs changed.
It’s a journey, not just a balance sheet
Remember, the journey of parenthood is more than just numbers and budgets. It’s about the joy and challenges of raising a little human. Sure, the financial part can feel overwhelming, but it’s also manageable with a bit of planning and a lot of love.
Preparing for a baby financially doesn’t have to be complicated. Save what you can, spend wisely, and be ready to adjust your plans. That way, you can enjoy the ride of parenthood without the stress of money worries hanging over your head. As someone who’s lived it twice, I can say it’s a wild and rewarding ride that’s worth every euro.
Follow Luca Caruana’s weekly column here, and his LinkedIn account or his Instagram for more budgeting hacks. For other money-related columns, check out Luca’s thoughts about the girl math trend and his advice to help change the narrative about women and money.