How much should we have saved up before we have a baby?

July 15, 2009 6:45 AM

When the time comes, I'd like for it to be possible for me to stay at home for at least a year after a baby is born (I am not pregnant yet). I guess this is two questions. First, how much should I have saved up to care for baby for the first year and secondly, how much should I have saved up to cover myself for the year?

Mr. Mittenbex is a teacher so there will be other income obviously. I am currently only bringing in about 21k a year.

I know the obvious one-time costs like crib, car seat, furniture etc. But I'm looking for advice from parents who have an idea on what they spent on their kid in the first year. I am planning to breastfeed so hopefully that works out and out goes the cost of formula.

Thanks, guys!

posted by mittenbex to work & money (28 comments total)

You can get most of what you need used for much cheaper than new, just make sure stuff like cribs and car seats meet current safety standards. You can often even get stuff for free through places like freecycle.org. I've been shopping for clothes for grandchild number 2 (due in September) lately and finding lots of really good barely used clothing for next to nothing.

How much you need to set aside is going to depend on your lifestyle, and that will change when you have a baby. If you're used to shopping a lot, eating out a lot, going to concerts, plays, etc. you'll have to take into account cost of babysitters.
posted by mareli at 7:03 AM on July 15

One thing you could do is start now living on just one salary, or as close to as you can. In other words, save your entire salary; even if you don't have a baby, or don't have one for years, you'll end up with a nice nest egg. This way, you won't really feel the difference when you leave your job to take care of the baby, plus you'll have a cushion for the inevitable additional expenses. But you'll find that in the first year of the baby's life, except for investment in the baby (furniture, clothes, medical), your expenses will go down because you won't be going out as much, or you'll be going cheaper places that are baby friendly. (ymmv) I'll leave it to others to advise what kinds of instruments to save it in, but obviously it would need to be reasonably liquid. (And when I say "save" I mean "save" not "invest"-- you want this risk free.)
posted by nax at 7:12 AM on July 15 [8 favorites]

It's really going to depend on your lifestyle. I've heard ridiculous figures quoted in the news media about the cost of having a baby. But it cost us very little, really.

Mrs Morte and I were in much the same situation. She left her job to look after our son, who is now approaching three. There's another on the way.

The key things that helped us were (a) eBay and Freecycle - crib, stroller, etc., (b) hand-me-downs : it's amazing how many relatives and friends had clothes and other baby equipment in storage waiting for someone to need it, (c) not caring at all about 'baby gadgets' and fashions. Buy the cheapest clothes, because in the first year they're really only going to be worn for a matter or weeks.

For a lot of people, baby stuff has to be brand new. They can't face exposing their newborn to something some other baby has used; but in our case I think the only things we bought new were the car seat (for obvious reasons), bottles, bibs, a few cheap items of clothing, a small Ikea drawer unit for clothes, and a new mattress for our eBay crib.

In hindsight I'd say buy as little as possible before the baby arrives - just the absolute essentials for the first few days. Avoid anything that looks like a gimmick and buy or borrow anything else you need as and when you need it.
posted by le morte de bea arthur at 7:18 AM on July 15 [2 favorites]

We were fortunate to have a pretty nice baby shower that set us up with crib, stroller, car seat--all the essentials, plus a lot of clothes and a big pile of diapers. I think we came away with less expense than a lot of people because of that. Since our baby was breastfed and we already had the furniture and clothes, our only expenses were additional diapers and beginning baby food. In the first year, we spent under $700.

It's probably safe to plan for about six diaper changes a day. It's easy to find about 200 diapers for $40 at Costco, so say 20 cents per diaper. $1.20 a day. Multipiled by 365 days, that's $438 per year.

We used this formula for homemade baby wipes, which is a huge savings over buying the pre-made wipes. At most, that was another $100.

After that, it's just rice cereal and strained veggies.

We might be more frugal than most, but I can guarantee that babies have no idea that their clothes are used and their wipes are homemade. Babyhood can be done much more cheaply than some articles would have you believe.
posted by Pater Aletheias at 7:19 AM on July 15 [3 favorites]

These are good suggestions. Buying used is the way to go, unless it's not safe or hygienic, of course. But there is no reason to buy new stuff when you don't have to. Consignment sales, friends and Craigslist are all great options to find inexpensive baby supplies.

I, too, planned to breastfeed. However, I had to use formula as my baby never caught on to breastfeeding (we were separated for about a month and it just didn't work). So, I used generic formula which was completely fine and saved a ton of money.

Making your own baby food never worked for me. I didn't have the patience to cook batches of stuff. Plus we were out and about so much, visiting people and so on, that jarred food worked better. Using coupons and buying on sale is my best strategy there. This cost is only for about 4-6 months for most people as you transition from baby food to regular adult food in regular adult form.

Also, I think for #2 we will use cloth diapers. I will have to wash them at home, and it will be a little inconvenient, but I won't be spending $20/week on diapers, either. The costs go down as the child gets older and you change diapers less frequently. I also use a lot of coupons on diapers and buy generic when I can. Wal-Mart has excellent generic diapers (that's also where I bought the generic formula).

You asked about staying home after the baby is born. A lot of women don't really think about their ability to work during the pregnancy. I would urge you to factor that in, too. I developed pre-eclampsia (really high blood pressure) around 30 weeks, and was in the hospital at 31 and delivered at 32 weeks--8 weeks early. So if you end up with some other complication that keeps you off your feet and resting, and you don't have disability coverage (I got pregnant in the waiting period before it'd take effect), you will need to have funds to cover that, too.

When you have a baby, there's about 3 months where you don't really do anything, because you're exhausted, and the baby is too tiny to take anywhere public (if you're worried about germs, like I was). So you don't go out to eat. You eat whatever is laying around. You don't go to the movies (my daughter is 14 months and I still haven't been to the movies since she was born!). You just don't do stuff. But you sit around and gaze lovingly at your baby, and play with him/her, and generally have a fun time getting to know your child. Also, there is a lot of laundry, which tends to keep you occupied.

We saved up half of my salary for about 6 months in our savings account and I was glad to have that. It really helped, especially since I delivered early. But we cut back on spending, too. Not a lot, but enough to notice. No more carryout or restaurant meals saved us a lot of money. I don't cook fancy at home; we eat a lot of eggs, peanut butter and ground beef-type meals. Casseroles are great!

Around 9 months I went back to work and put the baby in daycare full time. Around that time, she was starting to notice other children and daycare has been a very positive thing for her. Staying home with her also was very positive because I really feel like her good health is related to not being stressed out in a daycare situation while she was trying to catch up in growth.

I guess my biggest piece of advice is plan for the unexpected. I didn't expect to have a preemie, I didn't expect not to breastfeed, etc. Everything has turned out well, despite the circumstances, but I also had an excellent attitude. I rolled with the punches and didn't get (very) upset when things didn't go exactly as planned. Or, I had my little freakout moment but then relaxed. I owe a lot of this to my husband. Having a supportive partner is priceless.
posted by FergieBelle at 7:30 AM on July 15

The general rule is: babies are cheap, toddlers are expensive, teenagers are heartbreaking.

Which is to say that the real expense, not to mention the real suffering, doesn't start until long after that first year.
posted by rokusan at 7:33 AM on July 15 [3 favorites]

If you haven't already done so, set up a spreadsheet with all your monthly finances organized into spending categories. The more detailed the merrier. Next, set up a test case scenario with a new spending category called "baby", and your income adjusted. Go Banana jr. currently costs us about $150/month (diapers, clothes, etc.). We spent about $1500 on start-up (crib, chair, nursery furniture, car seat, clothes, etc. etc.) plus an additional shocking amount on a very expensive stroller (what can I say? I live downtown and don't have a car...I was fussy...). Keep in mind that your discretionary spending (entertainment, clothes) will drop, except for when you buy maternity clothes.

This might be a good starting point. Best of luck!
posted by Go Banana at 7:35 AM on July 15

If you have friends or relatives who have had babies within the past five years or so, you can save a ton of money on clothes, toys, bassinets, infant swings, and all the other crap that's useful for a month or two and then gets outgrown. We're about ten months in so far and the only things we've actually needed to go out and buy is diapers, a car seat, rental of a breast pump, and (later on) food; literally everything else came from other parents who were thrilled to clear out their closets and attics.

This was not from a conscious attempt at frugality on our part; it's just that baby stuff doesn't get used for very long, and most of it still looks new by the time the kid outgrows it. It won't be long before you're looking around for someone else to dump the stuff on.

(Also, a lot of the furniture and gadgetry is totally unnecessary: a changing table is just an overpriced table with a fancy pad on top; a countertop or regular table and a folded towel work just fine. That big fancy convertible stroller looks exciting but you'll soon wish you got the cheap tiny folding one instead, or even just a ten dollar moby wrap, because lugging around the big one is such a pain. A diaper genie is just a fancy airtight trash bin. And you definitely don't need a wipes warmer.)
posted by ook at 7:55 AM on July 15 [1 favorite]

I'm in this exact situation right now, as my girl is approaching 6 months pregnant. I was able to get great deals on a changing table, breast pump, travel system, dresser, bassinet, all from friends who were more than happy to either give or sell at a wonderful price as they didn't need it anymore.

Baby showers can yield you a lot more loot than you think if you register right.

My girl is probably going to be home for the first 5-6 months, but then she will have to go back to work.

The big thing I'm stressing on is child care O.o
posted by Industrial PhD at 8:12 AM on July 15

Besides some great advice about how to limit your costs, this tool from MSN money is something my Mother, who is a family lawyer that handles custody and child support details among many other things, endorsed as very useful.

It overviews what people on average spend on their kids, at different family income levels and based on the age and number of children. So while it may not address how you might use all of the cost-saving tips, it can be a nice starting point for what you should expect average expenses to be. You can also look at what items would NOT apply (for example, no or very little child-care costs if you will be home with the baby).

For example, a 2-parent family with an after-tax income of $39,100 or less spends an average of $6,490/year for housing, food, transportation, clothing, health, childcare and miscellaneous expenses, for one child under age 2.
posted by bunnycup at 8:22 AM on July 15

Definitely get everything you can from friends (we couldn't...we were the first of our group to procreate). If you have to buy, think longterm. Our nursery furniture is IKEA Trofast and will therefore last jr. throughout childhood. The crib converts to a bed. We actually paid a premium on the stroller to get the smallest thing available that will still carry a newborn, and it's been totally worth it. I love my stroller (Bugaboo Bee), and it's great on city transit. I have found wraps tiring on a full day excursion (though they are overall great and I always carry one with me).
posted by Go Banana at 8:29 AM on July 15

I spent quite a lot on enjoyable fripperies -- pretty slings, cute baby hats, etc -- and very little on "essentials."

Baby Essentials That Aren't -- I never used a crib, infant car seat, baby bathtub, and didn't have a stroller until baby was about 20 months old and would not have bothered if I hadn't developed a knee problem. Baby food is quite unnecessary.

A good book about breastfeeding is a sound investment; Dr Newman's is tops. You need neither bottles nor a pump.

One unexpected expense: I went through a pile of shape changes post-partum and had to buy a fair whack of new clothes going through it. The bra expenses alone were sizable. Even if you go back to your old weight, some of it may be in different places. I also went up a shoe size and never went back down -- that was expensive, too.

A good consignment store is a boon for clothes, both for buying and re-selling.

I recommend not doing a "nursery." I bought a big shelving unit and went to used book fairs until I'd built up a good kiddie library, and apart from that didn't decorate. The baby will not care, and it will be fun to decorate as your child does start to care.

I realise neither I nor many others are giving you a direct "You will spend $X on clothes." There are just so many variables. Finding or not finding a 2nd-hand snowsuit you like, having or not having friends with outgrown stuff to give you, little things like that make a big difference.
posted by kmennie at 8:57 AM on July 15 [1 favorite]

1. the living on one salary thing is brilliant.
2. start watching your local's craigslist kids section to see what the going rates are for things so that you know when to pounce
3. everything used but the carseat (and carseat used is probably okay if from a trusted friend or relative that can assure you that it wasn't in an accident)
4. cloth diaper - we cloth and LOVE it. So much cheaper that disposables.

But in general, the best places that I know of that are helpful to be a frugal parent are:

- baby cheapskate (read the articles on the side especially)
- Baby Goodbuys

Keep an eye on these 2 and you'll learn what the real deals are.
posted by k8t at 9:01 AM on July 15

I was able to get great deals on a changing table, breast pump, travel system, dresser, bassinet/

I'd argue that all of those things are completly optional, just FYI.
posted by k8t at 9:11 AM on July 15

Its not really how much you NEED TO SAVE...as much as it is HOW LITTLE YOU WILL BE ABLE TO SPEND during the 1 year when you want to stay at home.

No amount of budgeting in advance will work if you don't become thrifty/frugal during the 1 year you are at home.

I would suggest buying durable goods that don't expire in advance...and in BULK (diapers).

Also, DO NOT buy a carseat used. You don't know the history, or if it was ever in an accident. Carseat manufacturer's tell the user to THROW away a carseat in a car accident (even if no baby was involved), and send the user a brand new one for free (our experience).

Good job saving money...but seriously...don't risk a used carseat. The reward of saving a hundred dollars or so is not worth the risk of serious injury.

Good luck.
posted by hal_c_on at 9:37 AM on July 15

My only addition (but I think it's been mentioned already) is to expect the unexpected. We were just trying for one, and ended up with three. You truly never know.
posted by pyjammy at 10:26 AM on July 15

A lot of the cost is spread out over your child's lifetime. It's more important to:
a) save something every paycheck for college.
b) change the way you spend money to redirect things away from you and your husband, and toward the baby.

It sounds cheesy, but having a baby really does change the whole way you live your life. Your finances should match that.

As a practical matter, consider how much you're going to spend on diapers, wipes, and other disposable baby-hygiene items. (diapers.com is a good place to look at prices, and perhaps buy some things. I'm a fan.)

I'd say that an emergency fund of around $10-$15k in today's dollars should suffice for the unforeseen. At least for a little while. You should have this anyway, baby or not.

Good luck!
posted by Citrus at 10:29 AM on July 15

I don't know your insurance situation, but it's worth remembering that you may well have medical bills for the birth. I have decent enough insurance but still ended up paying about $3000 out-of-pocket (including some preterm visits) for my daughter's birth in May. You'll want to factor this into your savings calculations.
posted by bitterpants at 10:30 AM on July 15

Yeah, I didn't factor in health care. Our insurance at the time was so good that we spent very little on doctors in year one. A lot of the well-baby stuff was free. You'll want to factor in all the immunization costs, etc., if you haven't already.

Here's the breakdown of annual baby expenses from the link bunnycup provided.

Housing 2,500
Food 910
Transportation 780
Clothing 370
Health 460
Childcare 840
Misc. 630
Total 6490

This kind of reasoning just makes no sense at all to me. Our child expenses in those categories were:

Housing: FREE (we let her stay in the house we already had at no charge)

Food: FREE for the first five months (breastmilk), at the very most a few hundred for the rest of the year.

Transportation: FREE (a good carseat was given to us, and we let her ride in the car we already owned at no additional charge. Addition fuel costs due to her weight were negligible.)

Clothing: FREE to very cheap (gifts, hand-me-downs, Craigslist), except for diapers, ($450ish)

Health: Again, this will depend a lot on your insurance.

Childcare: FREE. My wife took care of her at no charge, and we organized baby-sitting swaps with other couples for nights away.

Misc: FREE. We don't do miscellaneous expenses. Everything is accounted for.

Total: Around $700 annually.

I guess there are enough people who get bigger houses or buy minivans when they have a baby that the averages might really look like this, but this seems pretty useless as a budgeting tool.
posted by Pater Aletheias at 12:22 PM on July 15 [2 favorites]

One thing that will help, that you need to do now, is see if you can get or have short-term disability insurance. The premium is pretty low if you get it through work, but it will not cover maternity leave within about a year of first purchasing it. It's also good to have if there are complications that lead to you leaving work before childbirth.
posted by saffry at 12:33 PM on July 15

Ah, cloth diapers! Apart from benefits already mentioned, I loved the gause ones to use for dishtowels and the flatter ones for cleaning cloths - they were wonderfully absorbant and durable. I think the last one bit the dust when my daughter was ten. I mourned their loss.
posted by path at 3:14 PM on July 15

Yeah, there are a lot of ways to spend a shitload of money on a new kid. And there are just as many ways to not. There's no shame in hand-me-downs for maternity clothes and baby clothes.

Things that haven't been covered. Find out what the exact costs of the pregnancy and birthing will be. How many prenatal visits, how many tests, ultrasounds, etc, and what do they cost? Maybe talk to an OB doctor and see what their experience is with that.

How much will the hospital visit cost if all goes well? What if you have to go in early, or stay for a while? Natural versus surgical? What are the options available... does a different hospital charge more/less for more/less services? (This is getting to be a big business- birthing centers run the gamut all the way up to 5 star hotel status. Know what you're getting into.)

And I think this is probably a budget killer: doctors visits for the new baby. Sure, the copay might be $20 x maybe 12 visits. And the regular vaccinations are probably covered. What about the special cradle cap creams and the medicated butt creams and the shots and the "OMG peanut allergy" testing?

My goal would be to plan for the "worst" (meaning budget for a lot of extra expenses) and pray for the best. Worst case, you have a baby who gets what she needs. Best case, you have extra money available for all the other stuff nobody thought of.

(Also, look at the cost of "servicing" cloth diapers at home versus a service. Running the washing machine all the time like that can get pricey depending on your utility rates and the soap you use. A service might not end up costing much more. Otherwise, yay for the cloth diapers. Less wasteful, and they keep on going. I'm 33, and the oldest of 4 kids. I'd bet any money my mom or dad still has a few of those things laying around as dustrags or for car washing.)
posted by gjc at 3:39 PM on July 15

I can't help you with how much you will need in savings, but I can honestly say that I actually saved money after my son was born. No more eating out just for the hell of it, no more drinks if we do go out for dinner. No bars or impulse shopping. These things came naturally and I never really felt like I was missing out on that kind of stuff.

I breastfed, used cloth diapers and wipes (made my own solution), I used baby food a few times for convenience, but really you don't need anything fancy for baby's first food--I did a lot of avocado, bananas, yams, etc. I never purchased baby food for home use. We co-slept, so no need for a crib (I did have a hand-me-down bassinet for naps). Clothing, as others have said, can be quite cheap on craigslist/ebay.

I did splurge on a very nice stroller and a $300 car seat, but that was pretty much all I spent real money on. I think it's a lot more doable than most people think. You don't really need much at all--the babe just wants you, and anything beyond that is mostly a convenience to make your life easier.
posted by Lullen at 3:42 PM on July 15 [1 favorite]

I have to counter some of these "you don't need anything" folks. I didn't think I needed a pump, or bottles, because I was going to breastfeed blissfully from day one. Well, guess what? There were some problems. There are often problems, which you'll hear about if you ask around. I got them straightened out, but it took more than 3 weeks, and during that time, not only did I need a pump, and bottles, (and supplementation formula that I wished I would have researched ahead of time and brought to the hospital with me), I needed pump accessories (different-sized flanges), sterilization bags, nipple shields, one-on-one consultation with lactation experts ($100/hour), special ointment ($40) and supply-enhancing herbs ($60). I wish I had at least borrowed a bunch of bottles from a relative/friend with an older child before my baby arrived. Along those lines, some babies have reflux and are helped by sleeping upright, like in a swing. If you can borrow a swing ahead of time, that'll save you a rushed trip to Target some night at 9pm. So yes, try not to buy too much, but do try to arrange free access to some of the common baby items -- the reason they exist is that they are helpful to many new parents. Baby doesn't need a bouncy seat, but if he has one, you might get to eat while he's entertained by it for 10 minutes.

It's true that some people don't leave the house for three months and thus save a lot of money on eating out. That's not everyone's experience, however. My baby likes motion, motion, motion, and if I didn't take him out in the stroller and grab a sandwich from the deli along the way, I wouldn't get to eat. For a few weeks there, he only napped in a moving car and I would have fallen asleep at the wheel if it weren't for McDonald's iced coffee.

The rest depends on the details of your life. I got an expensive tiny stroller because it fits in my tiny car and on the train/subway. I got the car seat rated highest for safety (again, I have a tiny car). I got the cheapest Ikea crib available, with an expensive organic mattress so the baby wouldn't sleep breathing petroleum fumes. I didn't buy any toys. I didn't buy any maternity clothes but I've had to buy three different sizes of nursing bras. I hired a doula for the birth ($800), took a course in natural childbirth ($300), and saw a chiropractor for back pain ($300 in non-covered charges). Most clothes have been gifts and hand-me-downs, but I bought cloth diapers ($300) and supplement with the only disposable diaper that doesn't contain superabsorbent gel (.40 each). I estimate $4000 total for the first year of expenses.
posted by xo at 5:41 PM on July 15 [1 favorite]

I want to add that my other major necessity was a sling (ring sling for the first year, SSC to this day at 2 years old). It allowed me to get things done while still being close to baby. While it is true that nursing can be rough, there's really no need to run out and look for bottles/pumps/nipple shields, etc. I had nursing problems (Exclusively pumped for the first several months) and was able to borrow a hospital-grade pump from the hospital, free of charge. If we are talking standard necessities, the costs are low. As with anything for which you are financially planning, there could be any kind of costs and it is wise to realize that.

Sorry, I realize this isn't the exact point of your question, but realistically, if a parent is determined to stay home, it's often more of a reality than many realize.
posted by Lullen at 5:47 PM on July 15

I don't know your insurance situation, but it's worth remembering that you may well have medical bills for the birth. I have decent enough insurance but still ended up paying about $3000 out-of-pocket (including some preterm visits) for my daughter's birth in May. You'll want to factor this into your savings calculations.

Holy cow, did you have a c-section? My whole birth was $2k (homebirth, but still...). I'm sure it depends on where you live, but I can't imagine why it would cost so much for your portion alone.
posted by Lullen at 5:51 PM on July 15

I know the obvious one-time costs like crib, car seat, furniture etc.

Not sure what you mean by furniture other than a crib, but if you mean a special dresser and changing table and other nursery furniture for the baby, there's really no reason for that. I used this Ikea bookcase, which we happened to already have, with some holes filled with baskets, others left open. The open ones I used to store baby books, stack sheets and blankets, and arrange all the stuffed animals people gave as baby gifts. The baskets I filled with his clothes. It's still his "dresser" and bookcase, almost 3 years later. He can use it as long as it stands. It looks super-cute, besides. And the only cost to me was the baskets. You or your friends and family probably have things that can be repurposed in the same way.

I know only one or two people here have given a direct answer to your question -- how much will this baby cost the first year? -- but I think everyone is giving you little mini-pictures (most more comprehensive than mine) of how everything that feeds into that final number is a choice, and very little you have been told is necessary (like baby furniture, baby food, baby wipes) is really necessary. You might as well ask how much it costs to live for a year in a given city.

That said, I do agree with xo that the much-derided "baby gear" can be very effective at making things easier for you. My first was very fussy in the evenings, and he actually preferred being in his swing to being walked and bounced by me. Swaddled in his ridiculous $30 special swaddling blanket, being swung in his ridiculous $150 papasan-style swing, with a $3 pacifier in his mouth, he was finally, blessedly content. And I could eat dinner with my husband. So there's that.
posted by palliser at 6:53 PM on July 15

You might want to think about saving past 1 year; in Japan they consider 3 years after birth to be the minimum being raised by mom.

After living here for 3 years in such a safe, loving, and harmonious environment; I'm strongly considering doing the same.
posted by fan_of_all_things_small at 6:52 AM on July 16