Five smart ways to save for a baby
Part of the excitement of preparing for your baby's arrival is shopping for all the bits and pieces you'll need and, like all parents, you want the best for your child. In fact, aiming for quality can make good financial sense. Many mums and dads find that spending a bit extra can mean enjoying equipment that is more comfortable for your tiny tot as well as more durable.
The trouble is it's not always easy finding the cash to kit out your nursery. Following some clever strategies can mean you don't have to settle for anything less than the best.
1. Grow personal savings
Aiming to build a pool of cash savings to pay for baby-related items is a smart move. You won't have to rely on a credit card, and that's important because the last thing you need when you head off on maternity/paternity leave is a mountain of high-interest debt. Bear in mind too, retailers love cash, and paying with the folding stuff leaves you well placed to negotiate a discount.
2. Start early
Don't wait until your pregnancy is confirmed to start growing personal savings. Building savings from the time you start planning for a family can mean you need to save less each month to reach the same savings target.
3. Set a goal to work towards
Saving can be easier when you have a target to work towards. Make a list of baby items you'll need, shop around online to compare prices and allocate a cost to each item. Add up the total and work out what you should be saving on a regular basis to reach your target.
4. Avoid nice-but-not-necessary items
Many of the items your newborn needs will only be required for a relatively short period. Rather than winding up with a tonne of barely used gear, talk to friends and family to separate the must-haves from the non-essentials. Consider secondhand buys or hand-me-downs for baby clothing and maternity wear to further cut costs.
5. Save steady
Just as your baby bump will steadily grow, your maternity nest egg will also swell – especially if you look for opportunities to earn a higher return on your cash.
Choose a savings account where there are no monthly account-keeping fees, no minimum balance or monthly deposit requirements, and where you can access your cash at any time without penalty. That way you can save steadily and start focusing on baby's next exciting milestone well after they're born.
Getting into the habit of saving on a regular basis isn't just a sensible way to fund your baby needs. It's also good practice for when you shift from two incomes to one – even if it's only for a short period – following the birth of your baby.
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