Money management is a cute issue in lots of families, especially for new parents.
Just under half of Americans spend more than they earn each month. So, new parents can face particular difficulties keeping on top of the baby essentials, the cost of which can very quickly escalate. Living within your means can be a challenge, particularly for low-income families. Here are some tips to help you manage your money effectively with a new family addition to support.
Consider app-based banking
One way of budgeting successfully is by using banking apps, which are increasingly popular, used by 75% of Millennials to differing degrees. As a parent, these apps can help you by giving you a clear insight into how much money you are spending and how you can save money. They are easy to use and can show all your accounts on one screen, making them a useful, digital budgeting tool – particularly for sleep-deprived, foggy-headed parents. Roundup apps are particularly helpful when it comes to saving. They link to your card and round up each transaction to the next dollar. Each week, the roundups are debited into an account of your choice, with these incremental amounts building up over time and enabling you to save money. This could allow you to put aside money for your child in their own savings account.
Plan shopping in advance or shop online
Around 10% of monthly outgoings consists of groceries, and, when your baby weans onto solids, this percentage can easily hike without careful planning. By planning and preparing meals in bulk, you can save money while not compromising on taste or nutrition. You just need to be organised, price savvy and open to different ingredients. Also, look out for promotions on items such as diapers, formula and wipes, which can sometimes save you 50% of the original price. Meanwhile, try to avoid impromptu trips to the store: research shows that you are 10% more likely to splash out on an unintended purchase. Put a baby and sleep-deprivation into the mix and your overspending will no doubt increase. In contrast, doing your grocery shopping online enables you to plan your shopping in advance, scour for the best deals and monitor your running total as you shop. This makes it a much more economical – and time-saving – way of shopping.
Buy second-hand or older model items
There are certain children’s items that are worth buying second-hand. These include clothing, cribs and strollers, which, at full price, can literally end up costing you $1000s of dollars in the first couple of years. You can find plenty of bargains at a children’s resale event near you, as well as online. Better yet, given how quickly babies grow out of things, you still often get top quality products at a fraction of the cost.
If you would rather not go second-hand, it is still possible to make great savings by shirking the latest version of something in favor of last year’s model. Stores are often keen to offload end-of-line items, so, if you are not too picky about colors or whizzy features, you can save at least a quarter of what the brand new version would cost you.
Money management for new moms: baby steps can take you far
Budgeting can be daunting for new parents, as it can be difficult to keep a handle on the day-to-day costs of looking after a baby. This is especially true in the early months of broken sleep and the rollercoaster of emotions. However, app-based banking can help you have more control over your spending, as well as online shopping. Meanwhile, keep an eye out for promotions and go second-hand on baby equipment and clothing. These sorts of things can go a long way in taking the stress out of managing your money as a parent.