Skip to Content

How to Start Budgeting for a Baby – 8 HACKS for Every New Parent

One of the first realities that couples face when they are expecting a little one is finances. How much does daycare cost? How much does it cost for a year’s supply of diapers? Do we need to start saving for their education? It seems like the list of money-related questions are never ending when it comes to having a baby! In this complete guide, you will learn how to start budgeting for a baby and some tips to making it work!

When we first got pregnant, I couldn’t believe how fast everything added up. There is so many costs to consider. Before you learn how to budget, lets talk about all the things your baby will need!

Baby Costs to Budget for…

Every family and family situation is unique, especially when it comes to budgeting for a baby. While this is not the comprehensive list of everything you will need to consider and prepare for, I hope you find this list to be a good starting point. Here are some things you and your spouse may want to consider budgeting for in preparation for your baby…

Hospital Fees

As stated above, every family situation is unique, and this is especially the case when it comes to hospital fees. For example, some people do not have insurance and some do. Even with those that do have insurance, there are so many different types with different copay fees and deductibles. 

In order to best budget for your baby, get to know your insurance policy. Some insurance policies require copays at every doctor visit when you check on the baby while others do not. Some insurance policies cover the complete cost of the delivery and hospital stay with the exception of the hospital admittance fee while others do not.

Knowing your coverage will, in turn, help you know just how much to budget for whether it’s a couple of hundred dollars or a couple of thousand dollars. 


Depending on your work situation and your plan for the baby after his/her arrival, you may also need to look at and budget for childcare. Do you need your child to be cared for 5 days a week? Do you want your child to attend a mother’s day out program a few days a week? 

Childcare can be one of the most expensive costs for your family when it comes to your baby, and it’s important to budget accordingly. Once you and your spouse decide on childcare, start researching child care centers and options in your area. Take note of the average costs and start planning for that expense. 

College Fund

While this may not be necessary right away, many couples take advantage of their time before the baby arrives (and the childcare bill arrives) to start planning for and putting money into a college fund for their child. 

Some parents prefer putting a certain amount of money away per month while others choose to do a lump sum when tax returns roll around. No matter how you do it, it’s never too early to start thinking about putting away money for your child’s education. 

Life Insurance

Life insurance is one of those things that parents hope they never have to use, but it’s also something that can bring incredible peace of mind when thinking of caring for your child. No parent ever wants to think about the possibility of going to Heaven before their precious little one, but if you take the time to discuss this with your spouse and budget accordingly, you will be able to at least know that your baby will be taken care of (financially) in the event that something happens.

Not to mention, the younger you are when you get life insurance, the more affordable it is! So, if you are preparing for your little one’s arrival, you and your spouse may want to consider looking into and budgeting for life insurance. 

Creating a Will

Not many parents plan to create a will, but similar to life insurance, it’s one of those things that can provide you with peace of mind. Essentially, a will is a legal document that states who will receive your money and assets in the event something were to happen to you as well as who will take care of your child.

Again, it isn’t anything anyone wants to think about, but can be so helpful to set up and have. Because a will is a legal document, it does cost money to create. It can cost a couple of hundred dollars, so you and your spouse may want to consider budgeting for this as well! 


Now that we’ve tackled the more serious items to budget for, you will also need to budget for your baby’s nursery! Chances are, you don’t have all of the items you need for your baby, and these items can really add up fast! While you may be having a baby shower when baby’s arrival is getting closer, you’re also going to need to budget for the bigger ticket items including: 

  • Crib
  • Rocker
  • Changing Table
  • Dresser
  • Baby Swing

Of course there are more items, but these are just the most expensive that you may want to start shopping around for and comparing prices! 

Other Basic Needs 

Lastly, when the baby arrives, there are going to be monthly, basic needs that you’ll need to budget for. Again, every family is different so some items may not be necessary. For example, some moms may need to budget for formula each month while others may be able to breastfeed until the baby is ready for solids. 

While each family is unique, here are some monthly items you may want to start budgeting for…

  • Diapers
  • Wipes
  • Formula
  • Baby Food (4+ months)

How to Start Budgeting for a Baby

Now that you know what items to budget for, you may be wondering, how in the world do I start budgeting for all of this?! Don’t worry! 

First and foremost, you may not need to worry about some of those items above. Or, you may not be in a place where some of those items can even be considered right now, and that is okay! Here are our suggestions on how to start budgeting for a baby…

1. Build a Budget

Before starting to budget, you need to actually build a budget. As stated above, some of the items listed in the previous list may not be applicable to your family or they may just not be anything that you can afford right now. 

Every family is unique, so you and your spouse should sit down and list out what items are necessary to budget for. You could even put them in order of importance! 

You can even make this part fun by creating a savings goal that you want to reach before the baby arrives! Look at what money you need to save now versus what you’ll need to budget for and account for once the baby gets here and then go from there. 

2. Set Aside Money Each Month

One of the most effective ways to budget for a baby is to start saving and putting aside money each month. In theory, this is a simple task, but depending on your financial situation, it may not be so simple.

Our best advice to you for this one is to start with small changes. Maybe you like heading to Starbucks each morning before work? Well, if you simply cut out 3 mornings a week, you could put away around an extra $60 per month! Just imagine if you cut it out completely! That could be around $100 each month to save! 

Not everyone loves their Starbucks, but you could find ways to apply this principal in your own life! If you don’t have extra cash lying around, start saving in small ways by cutting out some unwanted purchases and putting that money aside! 

3. Centsible Accounts

There are actually many bank accounts that have these “Centsible Accounts” where whenever you make a purchase, they’ll round it up to the nearest dollar and put that extra change away. Again, this may not sound like much, but having an account like this will really surprise you over time! 

4. Money Saving Apps

There are also a great number of money saving apps out there that could help you budget for your baby! For example, Ibotta is a coupon-like app that not only provides cash back rewards for your normal store purchases, it also has a baby section where you can specifically save money and receive cash back rewards on diapers, wipes, and more! 

Take some time to shop around the app store to see what all is out there! These small money-saving techniques are really going to add up, free up some of your money, and allow you to start budgeting for your baby! 

5. Stock up Now

While you’re expecting, you may want to consider stocking up on some essentials that you know you’ll need! No matter how much you budget and plan, there are bound to be expenses that pop up once your precious little one arrives! 

If you’re able to, go ahead and buy diapers and wipes now. Be sure to stock up on the various sizes of diapers though! Babies will typically only stay in newborn size diapers for a very short amount of time! 

So, if you see any necessities that are on sale throughout your pregnancy, go ahead and get them now! Not only will it help you with budgeting when the baby arrives, it’ll also save you the time it takes to run out to the store in the middle of the night when you run out of diapers! 

6. Start a Side Hustle

If you’re finding that your family’s income doesn’t have a lot of wiggle room when it comes to budgeting for the baby, maybe you and/or your spouse could find some time before the baby arrives to bring in some extra cash! 

Of course, being pregnant is exhausting, but you might find that you have a special skill or talent that you could utilize to bring in some money for a baby fund. Maybe you like to bake and you could sell custom cakes? Maybe you like to write and you could do some freelance writing? Or maybe you love to make something crafty? 

If you or your spouse have a skill that you could utilize to bring in some extra money before the baby comes, go for it! Then, dedicate that money to your baby budget! 

7. Utilize your Tax Returns

This budgeting tip only applies to some people, but it may be something you’ve never thought about! For many, they receive a tax return after filing their taxes. If this is you, you may consider utilizing this money to save up for all things baby! 

Not to mention, once the baby comes, you will receive extra money on your tax return for a new dependent! You could either set the whole amount aside to put towards college for your child, or you could simply use that money when budgeting for baby items throughout the year! Either way, your tax returns could be a great way to get a jump start on budgeting for your baby! 

8. Request Cash for Gifts

Chances are, you will be having a baby shower for your little one! If you’re not in need of as many baby supplies (maybe you have someone donating or loaning you the big ticket baby items), you could ask for cash! 

Or, if this makes you feel weird simply asking for money, you could always request a few dollars instead of a card to “kickstart” baby’s college fund! What guest wouldn’t throw in $5 if they knew they would be playing a big role in your baby’s future?!

In Conclusion…

Babies can be expensive. From everyday items like diapers and formula to big items like daycare, it can feel overwhelming trying to start budgeting for it all! At the end of the day, if you can take small, consistent steps towards preparing for these expenses, you’ll be plenty prepared in no time! 

Below is a Pinterest friendly photo… so you don’t lose this post!
Other Posts You Might Enjoy…..
  • How to Choose a Baby Stroller – The ULTIMATE Stroller Buyers Guide>>> Click Here
  • How To Choose a Baby Crib – THE Ultimate Crib Buyers Guide>>> Click Here
  • Baby Items You Don’t Need – 8 Items to AVOID on Your Registry>>> Click Here
    Verified by MonsterInsights