Getting financially ready

Having a baby, especially your first one, is an exciting and over-whelming time, both emotionally and financially. There will be more expenses to deal with and more pressure on a budget that will now have to accommodate three and not two people, but there is hope.

There are a number of financial plans you can put into place before the baby arrives to ease the pressure on your bank account.

Eunice Sibiya, head of Consumer Education at FNB says, “Having a baby in today’s age requires careful financial planning. Everyone wants the best for their child, and first-time parents are very conscious about getting everything right whether it’s the pram they buy, or the school they send their children to. Of course everything won’t be perfect, but you can put financial plans in place before and after the baby is born to give your child the best start in life.”

A lot of financial preparation can be done before a baby arrives to ease the transition of a two-person household to that of three people. Ideally, it makes more financial sense to start saving as soon as you start planning to have a baby. Sibiya suggests the following:

Cut back on expenses

Your current budget might not have a lot of wiggle room for extra expenses, so see where you can cut down. “Identify the luxuries and cut them out.. Pay off your credit card and clothing accounts and try and start your maternity leave with as little debt as possible,” says Sibiya

Buy, buy, buy

Now that you’ve freed up some room in your current budget, shop, shop, shop! You can use the extra money while you’re pregnant to stock up on nappies, creams, wet wipes and anything else that is not perishable. When the baby arrives, you might find it difficult to run out to the shops every day or two for supplies. Sibiya says that it’s also a good idea to stock up on non-perishable food, easy to cook meals and cleaning products while you’re expecting. And keep an eye out for sales and bargains!

Babies need baby things

There will be a few once-off and large expenses you’ll have to take care of before baby arrives, such as travel systems, sterilizers, cots, compactums, baby baths etc. These will set you back in the region of R10 000 to R15 000.* “The best thing you can do for yourself is to make lists and tackle a few items each month before the baby arrives so that the financial load isn’t too much. There are a number of websites, magazines and apps that will help you compile your lists. First time parents are sometimes skittish of looking at second hand baby goods, but if you have family or friends who want to offload a cot or pram, consider taking them up on their offer,” says Sibiya.

Take advantage of rewards and loyalty programmes

Go through all your loyalty programmes and rewards and “cash them in”. Use them before they expire and investigate how best to use them before and after baby arrives.  FNB’s eBucks rewards programme is rated the best loyalty programme in South Africa and is affiliated with a number of retail partners such as Dischem and Makro*, where you can earn or spend eBucks when buying products for baby. FNB customers can also earn up to 15% back in eBucks when buying baby goodies at Checkers and Shoprite when using an FNB card. You can also spend your eBucks at a Checkers or Shoprite store.

Know what your medical aid offers

Contact your medical aid to make sure what they pay for and what not. Some medical aids have a baby programme that will help you with this. There will be a number of doctors visits, blood tests and scans. There are also a number of birthing options like natural versus C-Section, which carry different costs. Your medical aid will be able to confirm whether there will be co-payments that you are responsible for. It all depends what kind of plan you’re on and what rates your doctors charge.

Sibiya says, “You will also have to add the baby to your medical aid as soon as he or she is born and evaluate your current plan. Some plans are better than others when you have dependents, so do your homework.”

Maternity Leave

“Most importantly, know whether you will be on paid or unpaid maternity leave. When you inform your employer of your pregnancy, make sure you’re well versed on their maternity policy. Understand what your income will be and plan accordingly,” says Sibiya.

If you’re going to be on unpaid maternity leave, you’re entitled to UIF benefits. Sibiya says it’s important to start the UIF process as early as possible, whether you tackle the process yourself or decide to make use of an agency.

“There are a number of forms that you’ll need to complete, and your plate will be quite full preparing for the baby, so do what you can before the baby arrives,” she says.

Decide on Childcare

If you’re sending your child to a crèche or hiring a nanny to help out when the baby arrives, do your homework. Some employers have on-site crèches that offer discounts to employees. You’ll have the advantage of not having to drive out of the way to drop your little one off and you’ll have him or her close by if you want to visit during the day.

“Deciding to have a child is one of the biggest life decisions you can make, and the costs start way before baby arrives. The best thing you can do is plan ahead and be prepared,” concludes Sibiya.

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