How to prepare for a new baby

Just found out you’re having a baby? Get ready for some financial upheaval. Here’s what you need to know



From the November 2011 issue of the magazine.


Living on less

First off, figure out how much income you’ll have while you’re on parental leave. Employment Insurance will give you a maximum of $468 per week. Ask your employer if they will top this up. Then subtract the additional costs of raising a child—MoneySense research shows that a new baby costs about $16,500 a year. Financial planner Roel Sarmago advises reducing your spending before the baby is born. “That gets you used to the extra expense.”

Take advantage of free money

The Universal Child Care Benefit pays out $100 a month for each child under six. Depending on your family’s income, you may also be eligible for the Canada Child Tax Benefit. The amount depends on how many children you have, the province you live in and your household income. You can get an estimate of your benefits by using the Child Tax Benefit calculator on the Canada Revenue Agency website (

Protect your family

You don’t need to contribute to your child’s RESP right away, but get yourself some life insurance immeditately. “Buy term life,” suggests financial planner David Stewart. Breadwinners with dependents need to make sure they have enough life and disability insurance to support the family should the worst happen. A good rule of thumb is to get life insurance coverage for 10 times your income.

The cost of child care

If you want a spot in a provincially regulated daycare facility, sign up early: there is often a wait of several years. According to Today’s Parent magazine, this type of care will set you back $25 to $75 a day. If you hire a nanny, the process can take two to six months. It will cost around $300 a week if you provide room and board, and up to $600 a week otherwise.

Gently used gear

Your baby won’t be choosy about having the latest trendy clothes—yet. Find a friend or family with a child a year or so older than yours and arrange a constant stream of hand-me-downs. Set up a gift registry for your baby shower and pick up any missing items at garage sales and second-hand stores. But always buy cribs and car seats new so they meet current safety standards.

5 comments on “How to prepare for a new baby

  1. … and buy a good coffee maker because you will sleep a few hours less every night! 😀
    You will also have to be prepared to adjust some things in your life because the new family member will take up most of your available time.


  2. If we think that we are going to have a baby in the house there are several things which we can see for regarding the baby care and baby development. Preparing according to our needs will be a better option than those heavy parties. The baby related copy can also be a benefit means a chart to decide what to do and when to do.


  3. Absolutely agree about cribs and car seats. This is something not to scrimp on. Interesting video from the Royal Society for the Prevention of Accidents about choosing safe car seats here :–> click here


  4. After the baby born many people like to give them to the day care for the caring but this type of things are not good for the baby. For the caring of the baby in the home by doing a good plan and do it easily, for the baby what type of clothes or toys required are the most important thing, what type of food the baby can take give in the proper time.


  5. Great info.. I found it really hard to plan for baby #2, especially since i wasnt working then.


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