Women: Planning for the financial impact of children


Children are a special blessing and their arrival brings boundless love and joy into our lives that you can’t put a price on. But adding a child to the household impacts the family budget – and women especially – in very measurable ways. Whether this is your first child or your fourth, here are some financial matters to think about and plan for before and after baby arrives.

Check your health insurance

If you and your spouse are both eligible for employer-sponsored health insurance, compare plans to see which spouse’s policy offers the best coverage so you’ll be prepared during the open enrollment period. Along with comparing deductibles, co-payments and premiums, look at coverage for prenatal visits, hospital and midwife services, infertility treatments and dependent care.

Once you’ve chosen a health plan, read the policy carefully to see what maternity coverage is provided. Also find out if the policy covers complications from a premature birth, including a stay in a neonatal unit, and whether a separate deductible applies if your baby is hospitalized beyond a certain period of time. Typically, your baby will be covered under your policy from the time of birth, though you’ll have to contact your insurer to officially add your child to the policy. If you’re adopting a child, make sure you know when your policy will begin coverage.

Will you go back to work?

The decision to go back to work after having a baby is a personal one, and often depends on many factors. Maybe you want to work because you enjoy your job, or maybe you have no choice but to work because it’s the only way you can survive financially. Or, perhaps you want to stay home and you’ve spent the past few years shoring up your finances. Whatever you decide, know that your decision isn’t etched in stone. Women, much more so than men, tend to move in and out of the workforce to accommodate children. So whatever you do this year might not be what you’re doing two, five or 10 years from now.

If you return to work, try to keep everything in perspective as best you can. Working outside the home with young children requires a significant amount of mental and physical stamina. For some women, it’s the hardest, busiest time of their lives. At work, women may face supervisors who are skeptical of their dedication to the job or assume they can’t or don’t want to take on challenging, high-level assignments, which can limit opportunities for raises and promotions. At home, women in dual-earner households often face primary responsibility for a seemingly endless to-do list of household and child-related chores. If you’re married, make sure your spouse is an equal partner in these responsibilities and that you’re not trying to “do it all.” Encourage open communication and realistic expectations. Even then, be prepared for times when it’s hard to balance everything. In those moments, take comfort in the fact that you are providing for you and your child’s financial future and doing the best you can.

Build a financial foundation

You’ve had the baby, taken maternity leave, gone back to work and things are going smoothly for the most part. But you can’t stop there! Here are some other things you need to do:

Draw up or revise your will so you can name a guardian.

If you don’t already have life insurance, consider getting it.

Start a college fund and contribute monthly.

Don’t overlook retirement.

Now sit back, relax, and enjoy all those moments with your child that you can’t put a price on!

BARBARA KENERSON is First Vice President/Investments at Janney Montgomery Scott LLC and can be reached at BarbaraKenerson.com.