Budgeting, Personal Finance, Saving Money

Can You Ever Really Be Financially “Ready” to Have a Baby?

baby hand

The most common question my husband and I have been asked since we got married a couple of years ago is “When are you guys going to have kids?” Each time, we give the same answer — that were not ready for a baby yet. We’ve often received the following response: “If you try and wait until you have enough money, you’ll never be ready.” This response often bugs the both of us because we strongly disagree.

I’ll admit that if a couple were to not take into consideration the extra costs of having baby and don’t plan for that, then they would be severely surprised and indeed realize how un-ready they were when that baby comes. I also know that there can be certain expenses that come with a baby that aren’t typical or normal. However, I do believe that you can have a financial plan in place with measureable goals and, for the most part, really be financially ready for that baby.

Sometimes I think people use the “you’ll never fully be ready for a baby” excuse as just that — an excuse to not financially prepare. Some people would just prefer to take the hit as it comes and deal with things as they happen, but that is not me. I am a planner and if I can have a plan in place, I will. That’s why we have a financial plan in place so we can actually be financially ready to have a baby. We want to make sure we can afford all our bills and still have money to save and invest when we take that huge step into parenthood. We want to be able to do all this on only one income so I can stay home with our kids, which is an even more important reason for us to have a plan. Below are the steps of our plan that we are presently carrying out (we are currently on number 3 at this time so we’re almost half way there).

Pay off all credit card debt: There will undoubtedly be extra expenses in our budget with the addition of a new family member. We want to ensure that we don’t have more than necessary tugging for a portion of our income. No credit card debt means no credit card payments and peace of mind knowing that we don’t have to figure out a way to pay off our balances.

Buy a house: While I would recommend everyone to pay off their credit card debt before having a baby if possible, this one is more of a personal preference for us. I wanted to be in our own home first for a few different reasons. First of all, it was a lot easier putting money down on the house and paying for all the initial home costs with two incomes. We were able to buy furniture, window coverings, yard supplies and various other things we didn’t need in an apartment. In addition, I know we don’t have to worry about our landlord deciding to sell our house or raising our rent. We have a fixed rate mortgage and we know that will be the amount of our payment until we sell the house. And a third, more personal reason I wanted to own our own house is that I wanted to feel settled before starting a family. Having our own home puts me at ease because I know we’ll be here for a while (and I like the idea of being able to paint my baby’s room).

Have 6 months living expenses in an emergency fund: We broke this step into a 2 year timeframe. Our goal was to fund 3 months of expenses in our emergency fund last year and our next goal is to fund the additional 3 months this year. We completed our goal last year and are now working on the second half. I know that we won’t have as much extra money at the end of the month on one income as we do now on two incomes, so I want to take advantage of our extra earning power right now and make sure we have our emergency fund established and fully funded. We like having the peace of mind that we will still be able to feed and clothe our baby if an unexpected expense were to come upon us while we are only living on one income.

Buy a family friendly car: Right now we have two two-door cars that are extremely fuel efficient and pretty cheap to drive. Plus they are both paid for. While our cars are wonderful, I know that a 2 door car will not be ideal when I need to put a baby in the back in a car seat. A four door car that has a little more room than our current 2 door Honda Civic will be a bit more practical when our family starts growing. We still plan to keep our Civic as my husband’s commuter car, but we also want to buy a more family friendly car. Since we want to keep our monthly expenses to a minimum when we are living on one income, we plan to pay cash for the car, or at least pay off the loan before we have a baby if we do decide to finance. I know many people who are perfectly content having a monthly car payment (or even two) but we’re pretty fond of not having any car payments. This goal is really helping us in our search for a newer car as well because we’re not concerned with only monthly payments, but we are heavily interested in the bottom line and how soon we can pay the car off. This helps us stay focused on what we can actually afford (or should I say what we actually want to spend) and not get trapped by the lower-monthly-payment-but-longer-loan deal.

Finish our basement and complete other major home improvements: Before we have a baby we want to finish our currently un-finished basement and move our spare bedroom down there and also create a rec room. This will enable us to put a nursery upstairs where our current guest bedroom is, as well as have a play area for our kids. We have more than a few plans to remodel additional areas of our home in order to increase the value when we sell later. My father-in-law is a contractor and knows how to do pretty much any project so with his help we are able to do a lot to our house without hefty labor costs. Of course, we still have to pay for materials so we need a certain amount of money to be able to put into the house. Since we won’t have a lot of extra money left after our one income, we again want to take advantage of the double incomes we have right now. Our goal is to raise the value of our house quite a bit so that when we need to buy a bigger house for our growing family, we will be able to take the equity from our current house and use that as a 20% down payment on another house.

Wait for our one income to increase enough to cover our expenses: We already know that my husband will be the one to work while I stay home to take care of the kids, so we are also waiting for him to be established enough to make enough money to cover all our expenses. Now this isn’t a long shot for us — we’re not waiting for his salary to double or anything because we realize that would be pretty unrealistic. In fact, we’re only a couple hundred dollars off from our monthly goal. We’ve already done what we can to lower our monthly expenses so that we won’t outspend our income and honestly we could probably live on only his income at this point in time, but we want to have an extra cushion to be able to continue saving and investing. In addition to this, I am also looking into ways that I can make some extra money per month while I am staying at home. Whether it be blogging, watching other people’s kids, running errands, etc. I know that I can make a bit of money on the side to help with saving and investing. As long as my husband’s income can pay all the mandatory bills, any income I am able to generate in addition to that can be used at our discretion.

So when people tell us that we’ll never be financially ready for a baby, I know this in fact is not true. Sometimes I’ll share the steps of our plan, and sometimes I won’t in order to not to start an arguement. But the truth of the matter is that we are taking steps be ready for this big new step in our lives and I believe when the time comes, we are going to be thankful we did.

Image courtesy of kton25

30 thoughts on “Can You Ever Really Be Financially “Ready” to Have a Baby?

  1. I LOVE this article. My husband and I have a very similar plan to yours. We graduated college two years ago and started our 5 year plan a year ago, so we are on year 4. We want to have 6 months of living expenses saved up, 100K saved in retirement, enough money to replace our car, and for my husband to make enough so I can afford to stay home. This will make me 28 and my husband 34. Of course there is always the question on how long it will take to get pregnant, but I fully intend to take advantage of the wealth you can build when you are a DINK. Good luck with everything and realize that there are responsible people like you out there!!

  2. We’re doing the same thing- waiting to have kids until we feel we’re financially “ready”, and looking at similar milestones. We didn’t have any CC debt, but are working to get rid of student loans, we have a 3-month emergency fund saved, and we just bought a house and are currently looking into home-improvement projects. We’ve been told by parent-friends to get any major home improvement project out of the way NOW, because they won’t happen when kids are around.

    That said, we also get the “If you wait till you’re ‘ready’, you’ll never have kids!” line. I have friends critical of our choice to wait, and I don’t like to have to defend our choice! To be honest, I’m also a bit jealous of their freedom to go ahead and start their families, even while I’m trying to be “responsible”.

  3. Seems fair. We always lived on once income, bought a house, and had about a years’ salary in the bank before we had kids. (To cover the unknowns and increased expenses). & we have still certainly had our hard times with kids. OF course, we were well prepared, and I wouldn’t change a thing, but it is rarely an easy road.

    However, I think some people can take it to the extreme. A large percentage of people I know had much trouble conceiving. Anyway, sometimes I see it pushed that you should go a step further and pay off the mortgage and save six figures to help live off of, etc., before kids. Though I could see easily doing this is we waited 5 more years to age 30 (paying off the mortgage or saving an equal amount in the bank) I think it would have been a bit overkill. Youth is nice for raising kids, and I am glad we did not wait too long OR have to spend tens of thousands on fertility treatments (Which is hugely the norm around where I live).

    Of course, when people say that to you, it is because you are a rarity. You have a plan, and more people should. Frankly, in real life, I don’t know anyone else who had much financial plan when they had kids. Which is a shame. & why people don’t understand that you have a REAL plan. But you are obviously doing the right thing – will make the whole thing so much more easier and enjoyable. I can attest to that.

  4. Weather or not finances are important to have kids, feeling ready IS. So please keep on waiting till you feel like it.

    I am sorry others do not understand it, but I am glad you and your husband are willing to stand strong against the pushers.

    Ever think parents are like drug pushers? “common you know you wanna try it…don’t worry about the risks, kids are great, they’ll make you fly” 🙂

  5. My grandfather said that “Every child comes with their own loaf of bread”. Now that we have a 4mo old, I can attest to the truth in that statement. Of course, we are financially stable but not to the point that some of you seem to want to be before you have kids. We have student loans, don’t own a house, but have no CC debt, significant savings, and are in the midst of saving the down payment on a house. Sure, there are challenges and unexpected expenses but we budget, save, and have learned to adapt.

  6. Having children when your young and before you have your finances in order is why people stay poor.

  7. I have a different opinion. Although I think that paying off your credit cards, having a family car and having money saved up to be able to pay the doctor’s bills, as well as purchase the things you need for a baby are good ideas, you will survive if you don’t have your huge list done.

    We didn’t care about the finances when we got pregnant, a baby is a gift from God and He provided every need we had- regardless of our income.

    We have been fine living in apartments with our child, and paying off our debt at the same time. We live on my husbands income alone, no government assistance and no income from me.

    Am I saying you’re wrong for having this plan? No. If you have the desire to get all that done before thinking of children that’s fine. When you feel ready to have a baby, have a baby.

    On that note, if we respect your decision to wait- respect our decision to not wait. Just because we did not care about those worldly things before having a child doesn’t make us irresponsible.

    Being “poor” is all a matter of perspective. You might see me as poor because I live in an apartment, don’t have the nicest clothes, might not have all the new toys and things you have. But I might see you as poor for not having kids. What is the point of having stuff anyway? Does it make a difference in the end what you lived in or what you drove or what you wear?

  8. We didn’t wait to have all our ducks in a row, but we did want to make sure we were in a position to buy a four door sedan before having a baby.

    We’re doing fine now, and I think some of the hard times brought us closer as a family. But now, of course, with a 5-year-old, we’re getting hassled about having more kids.

    Now our issue is emotional, rather than financial. For people one is enough.

  9. Sorry. My above comment should have read “for SOME people” rather than just “for people.” I know that there are those who thrive with lots of kids.

  10. Trex – I so agree with you. Also, it astonishes me to hear that two working adults with no kids yet can not live on one income only. If the couple budgets well, and lives on one income for a few years, the large downpayment for a starter home can easily and quickly be accumulated. However, it seems that many couples can not do without many things.

  11. Great post! As I watch my brother and his wife deal with their new baby, I realize you can never be too prepared! I work as a financial advisor for young people so I run into this question alot.

    I actually just posted something similar to moneysmartblog.com about moving in together. Check it out. I would love to hear your thoughts.

  12. I agree with this approach but with a word of caution. If you wait too long, you could have issues conceiving a child or if you do there could be complications. I am an older parent and am can tell you that I am stressing about the ability to get pregnant for our second child. We certainly are not debt free but we are cc debt free, own our own home, etc. If I waited until I had everything you listed, I’d never have any children. But if you are young enough to get all of those items in place before trying for children, go for it 🙂

  13. trex: “Having children when your young and before you have your finances in order is why people stay poor.”

    this comment made me very sad. we had our first baby when I was 24 and my husband 26, while he was in grad school and I was only working a 20 hour job. We had to cut our expenses a TON, and i am glad that we had saved a lot our first two years of marriage, but now he has a job that supports our little family without me having to work. having a child when we were young and living on half of an income did NOT make us poor, it actually made us RICH- richer than any family living on two incomes.
    I think that this article is wonderful for those who would like to begin planning financially for children. However, after reading all the comments I am very discouraged. Just as people may look down on you for waiting to have kids until you are “ready,” is it fair for you to look down on those of us who have decided NOT to wait, to trust the Lord to provide for us?
    We are not being reckless, or stupid, which is how many of these comments make us feel. The reality is that life WOULD be easier if we had done all of those things before having kids. But, on the same token, you can still have a wonderfully happy family with less money and less financial security for a time.
    Bottom line, neither way is wrong, they BOTH have advnatages and disadvantages.

  14. My first question would be more along the lines of “why is it any of your business when (or even, if) we’re having kids?”

    But that’s just me.

    Regardless, I think if you can prepare as much as you can, as much as you’re comfortable with, do so. It’s your future and with or without kids, it will only be better if you have little or no debt to add to the stress, excitement, challenges, etc. ahead of you.

  15. Princessperkey, thank you you made me feel much better. My husband and I have been married for 2 years and have been together for 6 years. I know that we are not completely financially ready but are you ever? We both really want to get pregnant but are worried that we won’t make it. I know that our parents would help all they could, especially since they don’t have any grandkids, ours would be the first. Does anyone have any advice for us? I’m lost on what to do, follow my feelings or follow the “general rules of pregnancy”?

  16. Kim, It sounds like you want kids, but are afraid. Nothing will make that fear go away, in fact after 4 kids of my own I can say the fear increases in many ways!

    But to me they are all 4 well worth it. sure we don’t have all the best everything, but we do have food and shelter, once those are taken care of most of the rest is like icing on the cake.

    I still maintain your feeling is more important than financial security or lack therof, but I can’t tell you it will ever be a ‘sure thing’.

    Also to anyone worried waiting will make them unable, adopt, it costs about the same as childbirth.

  17. Thanks Julia for giving me hope! 🙂

    I’m nearly thirty and so I don’t have time to achieve very much on that list.

    I haven’t got any credit card debt, but I can’t even imagine ever owning my home, let alone in the next few years.
    My partner is still doing his PhD and I’m postdoc-ing, which means that I have no permanent job prospects either.

    As for the car, I take consolation in the fact that people had babies before cars existed.

    I’ll save as much as I can, but if I tried to be ready I think I’d have to wait until I was eighty.

  18. There are a lot of people saying here that having a fulfilling family life, even if you don’t have dick for money, somehow makes you not poor. If you can’t pay your bills, you are POOR. If your living on welfare and relying on the government to help you get by so you can selfishly bring a child into the world, you are POOR and it’s the child that will suffer, not you.

    Having a financial plan is not only responsible but NECESSARY. And any argument that says anything different is a blatant justification of a selfish decision. I don’t care how much “love” you have in your home, if you had that AND money you and your family would be better off.

    Now, if you know you will never have money and there’s nothing you can do about it, go ahead and pop out those kids. There is nothing to “wait” or “plan” for.

  19. i think your article is interesting and i do applaud you for being responsible. that being said, i think that you are being unrealistic, unless you are about 18 years old. contary to popular belife, it is NOT that easy to get pregnant at any time in your life, but being older makes it THAT much harder. and if you are one of those people, all that hard earn cash you’re saving will be spend on infertility treatments and you’re back at square one, but i’ll bet you’ll be so happy you’re pregnant that you wont even care! now, if you are blessed to be able to have children without using infertility methods, then KUDOS. my point: you never know!

    you might have a flood. someone might be in a car accident. ANYTHING could happen and your money could be GONE and then what…not have children?

    i just caution you about being prepared: it STILL leave room for events in your life, no matter the amount of preparation.

    it’s good your saving. and i would keep on. but you need to decide where your priortities are at.

    me, well, i want to be a young mother (28 y/o mother to 22 month old baby boy) and i want to be young when i have number two. i plan as i may and things come up, but i’m still having baby number two. and i’m not on government assistance, but even it if were, i pay taxes and i deserve it!

    so dont stick your nose up at us, the ones that dont plan to your degree, because i guarantee you’ll be WISHING you were us if you plan blows up in smoke.

    nonetheless, though i found your article to be borderline snobbery (as well as subsquent comments) i still wish you the best of luck because being a mother is a truly joyous thing and i’m sure you’ll have a lot to teach your children…and you’ll learn alot from them too–like it’s okay to be messy and not have your ducks in a row cause kids are UNPREDICTABLE and a lot of WORK! lol..it’s great!

  20. we would never have any child if we prepared as perfect as what the author said. we are new immigrants from an asian country , both me and my husband working very hard, have a full time job, but as the economy doing down and the houseing price is never seem to dropping in L.A, we can barely wait for pregnent until we pay off a house. that’s impossible. Now i 7 month pregnent and still go to work , we never relly or thinking about relly on government syetems to rising a child, we believe we can still survived. why own a house should be the preority for having a baby, if so, 80% young people in california should never get married, not even mention to have a child. also i believe we are very responsible for our child even we are just working class in the U.S.A.

    Dear author, according to your plans , the working class of United States should never have their next generation. so nazi

  21. What about the woman who makes more than the husband? And she is marrying a man with a child from a previous marriage? That’s a whole diff ball of wax too, don’t forget her! (Me). He told me we need to wait until we’re financially ready too…I agree….but it’s hard to swallow that reality. I’m 30, owe a lot in school and have my own plans in place financially. He’s in no place to support me full time if I stopped working. What would you all say to someone like me? And I know the man should take care of the wife, but times are changing and sometimes that’s not the way it is for most women.

  22. I think the author was just sharing her plan based on the judgement she gets from people for waiting. Everybody is different. For example, I have a bachelors and masters degree worth of student loans to pay off. If I wait to have kids until after that is paid it will not be physically possible for me to have any. Trust yourself and your partner. The two of you agreeing as a team to do what it takes to care for your child is probably the most important thing. However, I do not think government assistance should be counted on. That is for short term emergencies.

  23. I am a nurse and work with cancer patients. I’ve gotta say that yes, life would be easier and more stress free when you have all your ducks in a row before having kids. However, I have taken care of patients diagnosed with terminal cancer aging from their 20’s to 70’s, and I hear a common theme. All that matters is the people in their lives.

    I remember one lady that had her first child when she was 19 and had 5 children total. She said that yes, it was tough, but she would not trade it for the world. If she hadn’t, she would have never seen her grandchildren before dying of cancer.

    I took care of another lady who was in her 50’s that only had a few weeks left to live and she said she could die peacefully because she raised such wonderful children. This theme of being complete and content through to death because of their children is all to common in the patients I care for.

    I guess all I’m saying is our lives are fragile and short. Yes, be responsible with you decision making but don’t let the quest for financial security dictate all your life decisions. Whenever you feel like you are ready for a family you should go for it. If that means you get all your ducks in a row, great. If you have children before you own a home and have all you debt paid off and have a family car, I can tell you right now you won’t be regretting it on your death bed.

  24. Oh my goodness, you are SOOOO smart!

    I’ve got the same goals in mind (minus the 6 months of living expenses- I know Dave Ramsey says save for 6 but I feel safe with just 3.) I have serious baby fever though so it’s hard to wait!

  25. I feel like we’ll never really be out of debt though. Not with my student loans the way they are. *sigh*

  26. She is not saying that EVERYONE should do this. She is saying that this is her personal plan! Go troll somewhere else.

  27. It’s a bad idea to bring a child into the world and put it in harms way like you are saying. She wasn’t sticking her nose up at anyone. Quit acting all butthurt and go somewhere else if you don’t respect her personal plan.

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