Million dollar baby

The costs to consider before having a baby.

Nothing can prepare you for the lifestyle changes involved with having a baby. While it may be one of the most exciting times of your life, it can pay to know your finances are in order.

It’s important to start budgeting as soon as you start planning for a baby. Some upfront costs may include:

  • Doctor and hospital bills
  • Ultrasounds and special medical tests
  • Birthing classes
  • Maternity clothing
  • A nursery
  • Baby products (change table, pram, car seat, bottles, nappies, baby clothes etc).

Consider whether you will be having your baby in a public or private hospital and contact Medicare or your private health insurance provider to find out what medical expenses they will cover.

Here are some ways you can keep on top of your finances when starting a family.

Create a baby budget

Knowing exactly how much is coming in and going out of your account is crucial. Create a budget using your current income and expenses to find out how much money you have left over to contribute towards a baby savings fund. Try RACQ’s online budget planner to get started.

Arrange maternity leave

Ask your employer about your paid leave entitlements such as maternity or parental leave. You may be eligible for government benefits such as the Parental Leave Pay, Family Tax Benefit or Dad and Partner Pay.

Have the ‘money chat’ with your partner

It’s never easy to talk about money but its important to discuss the changes that will happen to your family’s finances. Questions to ask include:

  • Who is going to be the primary care giver?
  • Is the primary care giver going to work?
  • Do you need to change your day-to-day spending?
  • Should you delay major purchases?
  • Should you try to reduce your current debt?
  • What renovations need to happen before the baby arrives?

Create or update your will

If you don’t have a will, you will need one to ensure your child is taken care of in the event that both parents die. Think about asking someone to be the guardian of your child if you and your partner should die and name this person in your will. Make sure you have a binding death nomination for your superannuation as this is handled separately from other financial assets.

Childcare and schooling costs

You should update your budget before you go back to work to include what you will be earning when you return, whether its full-time or part-time. You will need to consider the cost of childcare and if returning to work will put you in a better or worse financial position.  Childcare and schooling will be one of your biggest expenses so seek support from family and friends where you can. Contact the Department of Human Services to see if you’re eligible for the Child Care Benefit or Rebate to help cover the cost of child care.


The information in this article has been prepared for general information purposes only and not as specific advice to any particular person. Any advice contained in the document is general advice and does not take into account any person’s particular investment objectives, financial situation or needs. Before acting on anything based on this advice you should consider its appropriateness to you, having regard to your objectives, financial situations and needs.