Having a baby is a big life change. It is a time of excitement and anticipation. There is so much
to do; shopping for baby furniture, a car seat, stroller and clothes. With all that soon-to-be parents are going, many forget
to do one of the most important things (no it's not take your folic acid) it's planning financially for the arrival of your
bundle of joy.
There
isn't a parent out there that would disagree, children are expensive, and we are not just talking babies. Statistics show
the first 12 months of a baby's life can cost more than $10,000. What about all those years after?
Gayla Cook, from Coast
Capital Savings Credit Union, says planning ahead is the key. "It's the best advice but it's hard to follow. If you can
plan ahead, if you can make some small decisions ahead of time, it will eliminate the extra stress, the financial stress."
Money is the last thing any new parent wants to worry about when baby gets home but Cook says it is essential.
The first thing to do is
find out if you qualify for Employment Insurance. There are a lot of people who just don't know the requirements. It's a good
idea to do the research when you are thinking about getting pregnant, or at least early on in the pregnancy, so you can make
a financial plan. "If you are eligible for employment insurance, the basic benefit rate is 55% of your average insured
earnings up to a yearly maximum insurable amount of $41,100. This means you can receive a taxable maximum payment of $435
per week", says Cook.
So now you know what you are going to get, now it's time to get a budget together. Cook says it's
important to first find out what you are spending before baby arrives, for example, where does the money go and what are the
discretionary things that maybe you can live without. Remember, you could be living on a lot less than you are used to. You
also need to start factoring in all those additional baby costs, like diapers, wipes, formula if you are not nursing, clothes,
and the list goes on.
Cook says when you are planning a budget remember EI payments are usually issued within 28 days from the claiming
filing day. That means there will be a 2 week unpaid waiting period before the benefits kick in. There is a relatively
easy and painless way to start stashing away cash for your maternity or parental leave, she says. "I set up an automatic
special term deposit. Only on my payday, every 2 weeks, $100 or $50 went into this term deposit and it made a little bit of
interest, more interest than if it were in a savings account. I just knew in the back of my mind that was there and that would
help me."
One
final thing parents should do to prepare for maternity or parental leave is get insurance, life or/and disability insurance.
"Disability in particular", says Cook, "the chance of you being killed is very slim, but the chance of
you getting into a car accident and hurting your back are quite high and then now you are off work." She says it's all
about protecting your family. "No one wants to talk about it, no one wants to spend the money, but it could be absolutely
the most critical thing that you do."
Having children is a life long commitment. Maternity/parental leave is only for a year, but planning
for a baby is about planning for a life.
Christy Laverty is a Mother of two beautiful girls and wife
to a talented artist. Playing Mom and wife keep her busy by day. In the evenings Christy is a editor for a Toronto all news
radio station. Christy has spent about a decade in the news business, both in television and radio. She also does freelance
writing for several parenting magazines. Check out Christy on her blog where she updates the trials, tribulations, and fun
of being Mother of two beautiful girls. www.frecklesthemom.blogspot.com
