New Baby, New Budget: Your Financial Checklist for New Parents

"Behold, children are a heritage from the Lord, the fruit of the womb a reward." — Psalm 127:3

Welcoming a new baby into the world is one of life’s greatest blessings. It’s a time of joy, wonder, and, let’s be honest—sleepless nights. Along with the excitement, there are also important financial responsibilities to consider. A little planning now can help set your family up for success and ease financial stress down the road.

To help you get started, here’s a New Baby Financial Checklist—a guide to navigating key money matters for your growing family.

1. Add Your Baby to Your Health Insurance

Between late-night feedings and endless diaper changes, it’s easy to overlook paperwork but don’t let this one slip through the cracks. Most health insurance plans allow a 30-day window after birth to add your baby to your policy.

While updating your plan, check that it covers:

• Pediatric care
• Vaccinations
• Hospital visits (just in case)

Because having a baby qualifies as a "life event," you can adjust your coverage without waiting for open enrollment.

2. Secure Life Insurance (For You, Not Baby!)

Life insurance is one of the most important financial tools for parents. If something were to happen to you, having a plan in place ensures your family's financial security.

• The primary income earner should have term life insurance with a death benefit of at least 10 times their annual salary.
• The caregiving parent should also have coverage—even if they don’t earn an income—since the cost of childcare can be significant.

3. Update Your Budget for Baby Expenses

Your budget is about to change! A new baby means new expenses, so create a "Baby" category in your budget to track costs like:

• Diapers and wipes
• Baby clothes (they grow fast!)
• Baby food and formula
• Car seats, strollers, and cribs

If money is tight, consider adjusting other categories to accommodate these new costs. A well-planned budget now can prevent financial stress later.

4. Create or Update Your Will

Many parents put this off, but it’s one of the most important steps you can take. A will doesn’t just decide who gets what—it also names a guardian for your child in the event that both parents pass away.

This is a difficult decision, but prayerfully consider who would provide the best care for your child if the unthinkable happens. Once decided, finalize your will to ensure everything is legally binding.

Proverbs 13:22 reminds us: "A good man leaves an inheritance to his children’s children..." This inheritance can include wisdom and values, as well as financial assets. 5. Build or Increase Your Emergency Fund

If you don’t already have one, now is the time to start. Aim for three to six months’ worth of living expenses in an emergency fund. With a baby, unexpected expenses are bound to pop up—whether it’s a medical bill, job loss, or an urgent home repair. Strengthening your financial safety net now can help you weather life’s surprises with peace of mind.

6. Update Your Taxes

A new baby means changes to your tax situation. Here’s what to do:

• Claim your baby as a dependent on your tax return—this could qualify you for up to a $2,000 child tax credit.
• Adjust your W-4 form at work to ensure your withholding aligns with your new situation. You may not need to have as much withheld, freeing up more money in your monthly budget.

Remember, aim for the smallest tax refund possible—you don’t want to give the government an interest-free loan!

7. Start an Education Savings Fund

It’s never too early to start saving for your child’s education. A 529 savings plan is a great option, offering tax-free growth when funds are used for:

• College tuition
• Private K-12 education
• Vocational or technical training

Even better, recent tax law changes allow unused 529 funds to be rolled into a Roth IRA for your child, giving them a head start on retirement savings!

8. Freeze Your Child’s Credit

One final step for financial protection is to place a credit freeze on your child’s file with the three major credit bureaus.

Unfortunately, identity theft can happen to minors, and fraudsters may attempt to open accounts in your child’s name. A credit freeze blocks this, keeping their financial identity safe until they’re old enough to use credit themselves.

Having a baby is a joyful, life-changing event, and planning ahead can make all the difference. By tackling this New Baby Financial Checklist, you’re taking steps to ensure a stable and secure future for your growing family.

God has entrusted you with this incredible blessing—now, with wise financial stewardship, you can provide for and protect your little one with confidence.