Balancing your baby and your finances! Budgeting tips for new parents
Taking care of your finances is a full-time job; more so with the arrival of a newborn baby. And, although babies are a bundle of joy, things can get expensive quickly, leading to feelings of overwhelmedness for new parents. But, with the right tools and learning on how to be financially savvy, juggling your finances and baby doesn’t need to be challenging.
So, if you want to know how to be a financial wizard, then read these tips below.
Have a medical aid or a hospital plan
Once you become a parent, you are never really financially stable. But that’s okay. Raising a baby will always be more than you had budgeted for, and unfortunately, doctor’s visits can happen when you least expect them. So, to be on the safe side, you should have a medical aid or hospital plan. You never know when your child might get sick or fall into an accident.
Although you don’t want to dwell on the negative, rather be prepared; hospital bills can rack up very fast and can use up all your hard-earned savings; savings that could’ve gone towards your child’s tuition fees. If you cannot afford both plans, at least get a hospital plan.
Consolidate any debt you may have
Being debt-free can sometimes feel unattainable. And with your bundle of joy around, it may start to seem like the furthest thing from reality. But, there is no such thing. Although this may seem counterproductive to your debt-free journey, applying for a loan can be a lifesaver.
As we all know, personal loans can be extremely helpful when used correctly. Your personal loan can help settle any outstanding debts, especially if you have outstanding debts with different creditors. Being hounded by different creditors for payment arrangements does become stressful, even more so when you also have a newborn baby to worry about.
Worst case, you might not have the money to pay all their minimum instalments. But that should not affect you or hurt your credit score. As a parent, you don’t need that stress. And this is why consolidating your debt and paying one monthly repayment can ease the burden.
There are many available personal loans in South Africa, and more importantly, you can now apply for a loan application online rather than go into a branch. Applying for a personal loan online is helpful for new parents as you can do everything in the comfort of your home. So, sit down and calculate all your outstanding balances from store accounts and credit cards and see how much you need from a lender.
Get into the habit of purchasing things in bulk
As a parent, you want your money to go a long way.
Buying in bulk can be helpful, as most of the time, you can get a good deal from bulk buying and you can avoid endless trips to the store. When going to the store, always make a list before you go. That will make sure you get everything you need because when you don’t have a list, it’s so easy for you to purchase something on impulse and then you end up going over budget. So, set money aside and stick to it. A few other items you can buy in bulk are; diapers, wipes, formula, laundry detergents, baby foods, bottles and paper towels.
Always have a budget and stick to it
Budgeting allows you to know where your money is going and how you plan on spending it. It helps to highlight what you need and how much you need. Having a well planned out budget will help you keep your finances on track and prevent you from adding any additional debt. Now, you need to tweak your budget so that it fits your child’s expenses. A helpful tip when tweaking a budget, especially for child expenses, is first to track your expenses. Tracking your expenses and seeing where your money has been going will give you an idea of what you need to cut down on a new parent. It can also give you a perspective of what your needs are right now. This will help you give your child the best life possible.
Save more money
People need to try and save when they get a chance. Although money may be tight at the moment, saving for an emergency can be a blessing. So, try and get into the habit of saving; you don’t have to save a large amount. Savings are personal and are based on what you can afford, so don’t worry about the amount of money you save. It’s more about the act.
Plan out your financial goals
As a parent, it’s understandable that you want to do everything for your offspring. But, with these tough economic times, it isn’t feasible unless you are wealthy, which isn’t the case for the majority of South Africans. So, it’s advised to prioritise your financial goals accordingly. For example, if you feel confused about whether you need to be saving for a house, your child’s university fees or your retirement, just stop. Stop and take a minute and think about what is important to you right now and what you can afford at the moment. Because trying to do everything will only stop you from making progress in achieving your financial goals.
Have life insurance
It’s hard to think about your passing and having to leave your child behind. Or being permanently disabled due to an accident. For your sake and your family’s, it’s beneficial for you to have a life cover. This guarantees that your family is protected in the event of your death or disability and that your child can still be taken care of when you or your partner are no longer here. As hard as it is, you must think about this now, not when it’s too late.
Forget about purchasing a new vehicle
Most new parents dream about owning a minivan. But, because of this big change in your life, it isn’t advisable for you to get a new vehicle. Yes, it may sound amazing, with all the perks for a new parent. But, that is money you can put somewhere else. So, make full use of the vehicle you have now and keep the minivan ideas at the back of your mind.
Be savvy when it comes to purchasing baby clothes
Baby clothes can become costly and can add up quickly. So, before you run off to purchase new clothes for your baby, ask your friends and family who have or had kids if they don’t have any baby clothes they can provide you with. This is a great way of cutting down on costs, especially for clothes, as babies grow out of them so quickly. So, whenever you have a chance, swap, borrow or buy pre-loved clothing and watch how much money you save.
Are you ready to be a financially savvy parent?
Being financially savvy isn’t impossible when you have the right tools in place.
More importantly, during this time, don’t be so hard on yourself. Beating yourself up over finances shouldn’t happen. Instead, you should appreciate this time in your life because babies are a blessing. Follow these tips, and you will see a change in your finances.
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