Having a baby checklist

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  • The medical costs of bringing a new life into the world can add up, so plan ahead and budget for them. Make sure that you'll be able to cover any out-of-pocket expenses for prenatal and maternity health care, for example. Insurance coverage varies widely, so check with your health care provider or human resources office about any copayments, coinsurance and deductibles you can expect, as well as your insurance coverage and reimbursement policies.
  • To be baby-ready, you'll need a crib, changing table, car seat, carriage, food prep equipment, infant clothes and more, so budget accordingly. Factor in the costs for any home renovations you may want, like a nursery room or upgraded bathroom.
  • Paying for baby food and medical care can increase your monthly spending; prepare to cover any copays for visits to the pediatrician, for example. Also consider the need for new clothing as the baby grows; diaper services or supplies; laundry and dry cleaning; and potential new expenses for child care, babysitting and preschool.
  • Think about how your income might change if you, your spouse or both of you choose to reduce your work hours. Compare the benefits and costs of stay-at-home parenting with paying for child care.
Make sure that all aspects of your health insurance policy are up-to-date and that you've met all the terms of the insurance contract.
  • The requirements often start with advance notification. You or your doctor may need to tell the insurance company about your impending new arrival well in advance of your due date.
  • Many policies cover prenatal care and childbirth as a package, but to qualify, you may need to select an obstetrician from the insurer's list and plan to give birth at a facility designated by the insurer.
  • If you do have an open choice of providers, will your preferred obstetrician and pediatrician be considered in-network or out-of-network for insurance reimbursement and referral purposes? A provider's status in your insurance plan may affect not only your out-of-pocket costs but also your access to hospitals, imaging centers and laboratories.
  • Many policies have specific procedures for adding coverage of dependents. To be sure that you have uninterrupted coverage for your new addition, check with the company beforehand.
Ensure that your life and disability insurance coverage is adequate and up-to-date.
  • A major role for life insurance is to provide resources for loved ones when you cannot do so. It stands to reason that as your family grows, so will the needs that insurance should cover. Will you and your spouse both have enough insurance coverage in your new circumstances?
  • Disability insurance can help protect your family's income. Parenthood creates new possibilities, but also new responsibilities and new risks to consider. Do you and your spouse both have adequate disability insurance coverage?
  • A new family member means a potential new insurance beneficiary. Are your beneficiary designations up-to-date?
Explore potential employer-provided benefits.(Remember that birth of a child could be considered a change of life circumstances under IRS rules, so normal open enrollment restrictions may not apply.)
  • A health care spending account lets you set aside some money each year on a pre-tax basis to pay for eligible medical costs during that year. A health savings account, if available, may allow you to accumulate significant health care reserves on a pre-tax basis to pay for major future medical expenses.
  • A dependent day care account lets you set aside money each pay period on a pre-tax basis to pay for qualified child-care expenses. Take care to deduct only what you are sure you can use each year because any money left over in the account on December 31 would be forfeited.
  • Companies must generally offer their employees some time off around the time of childbirth. Your HR or personnel office can explain your benefits and how to qualify for them.
  • Caring for a newborn is a lot of work. If you are considering adjusting your time on the job, look into job sharing and telecommuting opportunities.
  • If you are adopting a child, your employer may offer incentives or subsidies.
Review your existing estate plans.
  • Be sure your new child is accounted for in your will and your spouse's will. If you assigned shares of anything by percentage make sure those percentages reflect your intentions in your new circumstances.
  • Evaluate the impact of the new family member on any trusts you currently control or plan to create.
  • If you have existing guardianship arrangements, be sure to explicitly include your new child. Consider designating a guardian if you have not done so.
  • Review any letters of intent and similar expressions to be sure they reflect your wishes for the newest child.
  • Be sure that any retirement account beneficiary designations accommodate your new child's interests.
Given the high cost of a college education, it's probably not an overstatement to say you can never start saving too soon. Here are a few tools that can help.
  • A 529 college saving plan offers you generous contribution limits, flexible withdrawal rules and broad control over investments
  • A custodial account may offer potential estate tax and gift tax planning benefits
  • A coverdell education savings account can be used to fund elementary school, high school or college
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