Health Care and Financial Checklist for New Parents

From the womb to adulthood, a child is one of God’s greatest gifts. With such a tremendous blessing, however, comes great responsibility. As a new parent, it’s essential to plan before your child’s birth for the health care and financial responsibilities that come with your bundle of joy.

Here are seven ways to prepare financially for having a baby.

1. Re-examine your health coverage.

Having sufficient health coverage and using it wisely can help you reduce your medical bills. To optimize your savings, you can:

Understand your plan: Take a close look at your health plan to understand the terminology, how it works and what it covers.
Choose in-network providers: In-network pediatricians and hospitals offer discounted rates to health plan members, so contact your carrier to find in-network providers in your area.
Know your financial responsibility: If this is your first child and you’ll be switching to family coverage, your deductibles (what you pay before your health plan starts sharing costs with you, or co-insurance) and maximum out-of-pocket (MOOP) (the most you pay toward eligible health care expenses) will likely increase. Your health plan provider can estimate what you’ll need to pay for pregnancy care through delivery.

Check for medical bill errors: Review medical bills for accuracy and compare them to the Explanation of Benefits (EOB) you’ll receive from your health plan provider. Promptly dispute any errors.
Add your child to your health plan: Do this within the required time frame as determined by your health plan (e.g., 60 days of birth, adoption or placement into the home).

2. Budget for new and future expenses.

Pre-baby budget: In addition to medical expenses, consider other costs, like car seats, a crib and items to baby-proof your home. Prepare a list of what you’ll need and adjust your budget. Set spending limits and consider pre-owned items to help keep costs under control.
Post-delivery budget: Make a list of recurring costs that will change your household expenses for years to come, such as diapers, extra food and child care.
Emergency fund: Children can be accident-prone and susceptible to illness. Setting aside extra money for the unexpected can keep you out of debt.
HSA contributions: If enrolled in a High Deductible Health Plan (HDHP), you may be eligible to save pre-tax money in a Health Savings Account (HSA). HSAs may cover qualified medical expenses, such as prescription drugs, diaper rash cream, ear thermometers and teething relief drops. Money you contribute but don’t use rolls over to the next year and continues to grow tax-free!

3. Purchase or increase life insurance.

Life insurance provides financial protection for your family if an unexpected tragedy occurs. For young and healthy adults, term life policies may cost less than the monthly fees of many music or video streaming services.

To determine the amount of life insurance you need, use this Life Insurance Calculator to enter your current assets, expenses, income and other factors that can influence your financial needs.

Will you or your spouse stay home with your child? Follow tips for stay-at-home parents to help determine how much life insurance you may need.

You can also consider a child life insurance policy, which often has very affordable rates. Consider a term policy that lasts until your child is self-sufficient.

4. Create your will and assign beneficiaries.

In the event of your untimely death, it is critical to have a notarized will to help avoid lengthy legal battles contesting who owns your assets and defining who will oversee your child(ren)’s finances. Also, designate beneficiaries for your life insurance and any retirement savings accounts as soon as these benefits become effective.

5. Start a college fund.

While it might not feel like an immediate priority, the sooner you start saving for school, the more options your child will have. Learn more about strategies to invest on behalf of your child, including education savings plans, prepaid tuition plans and investment accounts.

6. Invest in your retirement savings.

When a child arrives, it’s easy to forget your personal goals and long-term plans. Stay on top of retirement savings so your child doesn’t have to support you later in life.

7. Claim the Child Tax Credit.

You may be eligible for the Child Tax Credit, a tax credit for parents with dependent children, which can reduce your tax bill. The amount you receive usually depends on how many children you have and your income. The credit is not automatic; you must apply for it when you file your income taxes.

Prepare your finances one step at a time.

Adding a new member to your family comes with a lengthy list of responsibilities, so give yourself time to focus on one priority at a time. Tackle the most important items on your financial to-do list first. Because medical bills will be some of your first financial obligations once you discover you and your spouse are expecting, start there. Next, budget for pregnancy, then focus on the first several months of your baby’s life.

Be ready for God’s blessed gift of parenthood.

By ensuring your health plan and finances are in order, you can relax and focus your attention on the most important thing: raising your child to know the Lord and providing him or her with unconditional love. For more information on health plans that align with your values on family and faith, contact us at Insurance@GuideStone.org or 1-844-INS-GUIDE (1-844-467-4843), Monday through Friday, from 7 a.m. to 6 p.m. CT.

GuideStone^® welcomes the opportunity to share this general information. However, this article is not intended to be relied upon as medical advice, diagnosis or treatment.

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