Preparing for a newborn: financial checklist for new parents

Preparing for the arrival of your newborn can be exciting yet daunting for parents, especially with the cost of living rising. Raising a child can be expensive, and it's crucial to ensure that you have a solid financial plan in place to avoid any potential ‘money stress’ down the road. You would need a backup plan to the backup plan while simultaneously making sure your child is brought up in an ideal environment. In this article, we'll explore five key ways to prepare your finances for the arrival of your newborn, so you can focus on enjoying your new role as a parent without worrying about funds.\

Preparing a budget 

A budget plan will give you an overview of 'wants' and 'needs', allowing you to identify areas of 'wants' to cut back on. The budget checklist allocated for 'needs' would usually consist of diapers, baby clothes, formula, and other essentials. Having a budget will be able to eliminate the stress of dealing with your finances as they come. With a set amount already in place, you will find it easier to deal with the financial challenges of being a new parent.

Research child care options 

It is crucial to seek the help of a trustworthy childcare service to prevent unforeseen circumstances like needing to work overtime in the office or other emergencies. The best place to start is by researching child care options that's best suited for you, these can be nanny services, in-home daycares or daycare centres. You can narrow down your options by comparing costs, location, hours of operation and most importantly the caregiver’s qualification and experience. 

Pay off current debts 

Reducing your current outstanding debts will help reduce financial stress and a provide peace of mind, allowing you to focus on your new family and the joys of parenthood without worrying about debt collectors or overdue bills. Start by prioritising your debts and creating a repayment plan. Focus on paying off high-interest debts first, such as credit card balances or personal loans. Consider consolidating your debts into a single loan or credit card with a lower interest rate to reduce your overall interest charges. As you pay off your debts, You can focus on accumulation/building wealth for your new family.

Set up education funds 

As mentioned in point 1, preparing a budget for the necessities is important for a comfortable early childhood upbringing, however, creating a savings plan will help you save up for your child’s future expenses, such as education and healthcare. It's paramount to start early while staying practical when setting goals. You should take your expenses, income and other financial obligations into account during the planning process. Additionally, you may want to consider setting up a separate savings account specifically for your child's expenses. This can help you keep track of your savings and avoid dipping into your emergency fund or other savings.

Consider getting a health insurance subscription 

Getting insurance for a newborn can provide some peace of mind for parents. While newborns typically do not have any financial dependents or obligations, there are certain situations where insurance coverage can be beneficial. By having health insurance coverage for your child, you can ensure that they receive the necessary medical care without incurring high out-of-pocket costs. If you're looking for ways to prepare your finances for the arrival of your newborn, consider Great Eastern Malaysia’s health insurance plan. Our comprehensive health insurance plans offer coverage for your newborn's medical expenses, including wellbeing checkups, immunisations, and hospitalisation. Protect your family's financial future with Great Eastern Malaysia's health insurance today!