I Wish Somebody Told Me THIS Before Having Kids
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If you're expecting a baby, congratulations! I'm sure you're so ready to meet your little bundle of joy. But is your bank account ready? We all know having kids is expensive, but a new baby can affect your finances more than you might think. Especially if your gender reveal is determined to be the cause of a devastating wildfire. Wish that was a joke. "Disappointed!"

Which also explains the US Forest Service's new ad campaign, "Only You Can Prevent Gender Reveal Parties." That's a campaign, I can get behind that campaign. It's a good one. Anyway, take it from this new dad, it's way more than just the cost of childbirth. There's a whole list of things you need to do with your money when you're expecting.

So today we're going to go over the ultimate new kid financial checklist. So you'll know all the things you should do to be prepared for that little squirt to arrive. But before we get started, hit those like and subscribe buttons and share this video with someone you know who is currently planning a gender reveal involving hot pink flamethrowers. They need an intervention and probably a fire extinguisher.

All right, first thing on the checklist might seem obvious to some of you, but it's super important, so I gotta mention it. And that is update your budget. You gotta make sure you have enough money to pay for having a baby without going into debt. Because the last thing you need when you're sleep deprived and hanging on for dear life is unpaid medical bills. And just so you know, the average cost of having a baby with insurance is $2,854. But without insurance, it's $18,865. Hey.

I think I'm going to be sick. That includes prenatal care, childbirth, and postpartum care. Now, if you don't have that much in savings, hold the phone, stop the presses, and get to savings. That means pausing extra debt payments, pausing other savings goals, and pausing investing. This is super important to keep you from falling into debt. And I call this stork mode, where you pause everything else and focus on saving up until mom and baby are home safe.

Another thing to factor into your every dollar budget is the plethora of things you'll need to take care of your sweet little rugrats. Things like a crib, a car seat, a bassinet, a stroller, formula, baby food, diapers, clothes, toys, an organic bamboo portable changing pad, and of course, butt cream. So much butt cream. A shocking amount of butt cream. I might as well be sponsored by Aqua 4 at this point. Now, if you're not careful, this can get wildly expensive real quick. But good

Good news, it doesn't have to. If you're having a baby shower, you can register for a lot of the things you'll need, especially the big ticket items. 'Cause you know Aunt Linda's just chomping at the bit to get you a monogram romper, but she may have enough cash in that Vera Bradley purse to get you that nice baby monitor too. And if you've got friends or relatives with kids, chances are they've got some plastic storage bins

full of outgrown baby clothes and toys and gear they would love for you to take off their hands. Now, as for the items you do have to buy for yourself, you can still be a smart shopper here. You can buy generic, buy used from Facebook Marketplace, and find deals online using apps and browser extensions like Honey. And remember, you're not a bad parent if you can't afford a diamond-plated car seat or the top-of-the-line stroller.

your kid will survive and have a great life regardless. But there will be things you have to buy on the reg, so make sure your new budget reflects your new monthly expenses. Okay, the next thing on the checklist can seem intimidating, but it's actually pretty straightforward. And that is update your health insurance. All you need to do here is fill out the proper form from your HR department or your insurance provider to add your new little nugget to your health insurance plan. But remember, now that you have more people in your household covered, the cost of your plan is gonna go up.

up. So be ready for that. Now you typically have around one or two months to add your newborn to your health plan, but check with HR or your insurance company to get them enrolled in time. Otherwise, they may not be covered until you can add them in your next open enrollment period. Now this next one on the checklist doesn't sound like a big deal, but considering how often kids get sick, this could actually be your secret weapon to affording parenthood. And that is to make the most of your HSA.

An HSA is a health savings account, which allows you to pay for medical expenses tax-free. And the HSA is amazing because it has triple tax savings. You're not taxed on the money you put in there. The money grows tax-free. And it's tax-free when you take it out and use it for medical expenses, which is a pretty sweet money hack. And no, a Stanley Tumbler is not a medical expense, even if it was your saving grace during labor. Doesn't count.

Don't try it. Big dumb cups. And get this, because of the triple tax advantage, some people prefer to just pay healthcare costs out of pocket and let the money in their HSA grow tax-free year after year. And they use this as a sort of extra retirement account because once you turn 65, you can take that money out for anything, including a big dumb cup.

without having to pay a penalty. - How exactly do people drink water before Stanley Cups? - So if you're gonna use your HSA for medical expenses, now's a good time to adjust your contributions to make sure you have plenty to pay for all those pediatrician visits and cover your out-of-pocket max for your health insurance. Next up on the checklist is something that makes people more uncomfortable than Harry and Meghan at a family reunion.

and that is update your will. Now, first of all, if you're about to have a kid and you don't have a will, get one. Like now, even before the kid's here, you need one. You know you need to, so stop putting it off and just do it. You put this off for months or even years, when in reality, you can knock this out in 20 minutes flat. In fact, I'll give you a discount code for a will from our friends at Mama Bear Legal Forms. All you need to do is go to ramseysolutions.com/will and use promo code GEORGE15 to get 15% off.

And to make it even easier for you, I'll drop a link below so you don't even have to type the URL. There. No excuses. Get it done as soon as this video's over. Now, if you already have a will, good for you. I'm happy. But make sure to update it when your child is born. Here's why. When you have a kid, you need to appoint a guardian for them in your will. Otherwise, the courts would choose who takes care of them if you were to unexpectedly pass in some kind of accident involving Roman candles on a fax machine. Strangely specific, but

Whatever. You'll also need to update the guardianship portion of your will each time your family grows. That way you can make sure the courts won't separate your kids and send them to live with different families. And I know this is hard stuff to talk about, but it's super important. So have the hard conversations, make the decision, and get the will done. Another thing to include in the will is instructions and wishes for...

taking care of your child, money for raising them, and assets they'll get when they're adults. This way, even if you're gone, you can still make sure that they watch Star Wars for the first time in the correct order. And everybody knows, you start with The Phantom Menace, you end with The Rise of Skywalker, and you skip everything in between. Those are the only two you need.

- I don't believe what I'm hearing. - But seriously, it will give you so much peace of mind to know that your family's well taken care of when you're gone and it only takes 20 minutes to knock this out. So go check that link out and get the will done. Speaking of death, the next thing on our checklist is review your life insurance and disability insurance.

Now, the purpose of life insurance is to replace your income if and when you die. So if anyone in your life relies on you financially, you need to have this in place. And both you and your spouse need to be covered, even if one doesn't work outside the home. Think about this. Losing a stay-at-home parent would still affect your family's finances. And all the parents paying childcare costs know that those things are higher than the girl from the Tal Bachman song. ♪ She's so hot ♪ A little raspy, but we'll go with it.

Now, when it comes to life insurance, you wanna stick with a 15 to 20 year term life policy that covers 10 to 12 times your annual salary. And as a general rule, the younger you are, the cheaper it is. So do this sooner rather than later. Side note, stay far, far away from term life's evil cousin,

Whole life insurance. That is a scam disguised as an investment that makes other people a lot of money. It's like 10 times the cost and it's not a good deal for you, but it's a great deal for the people selling it to you. Now, disability insurance is a horse of a different color. Disability insurance covers your family if you get sick or injured and can no longer work. Now, it's not uncommon for employers to cover this as a benefit.

So you may just need to check with HR to make sure that your coverage is high enough to cover your family. Now, before we move on, I want to tell you about a way you might be able to save some money, which can help pay for all this baby stuff. And that's by switching to Tello, the sponsor of today's episode. Tello is a phone service provider designed to be super affordable and super flexible. And Tello is celebrating their eighth birthday, which means they've been around longer than TikTok

and any seven-year-old. They've got flexible plans, no contracts, no strings attached, and no fees. And no joke, I signed up for Tello in less than 60 seconds from the comfort of my king-size bed before my wife even had time to send me another Instagram Reel from a parenting influencer. Tello pricing starts as low as five bucks and goes up to 25 bucks for the unlimited everything plan. And you're free to upgrade and downgrade whenever your heart desires.

And to save you even more, I got you covered. Go to tello.com slash george to get five bucks off their unlimited data plan for your first month of service. And let me tell you, I know this code works because I used it myself to save five bucks on our own plan. That's tello.com slash george. I'll also drop a link in the description for today's episode. Okay, back to the checklist.

Next up, beef up your emergency fund. I always recommend having three to six months of expenses saved for emergencies. And guess what? If the stork is headed to your house, your expenses are about to go up, which means you might need to add some cash to your emergency fund, especially if you only have three months of expenses saved. Next up, plan for childcare costs.

This is a big one. If you or your spouse is gonna stay at home, you probably won't be spending that much in this category. But if you're gonna need daycare or even a nanny, this can get expensive real quick. According to Care.com, the average weekly cost for a nanny is $766 and the average weekly daycare cost is $321, which means if you need a nanny, that could end up costing you about 40 grand of net income per year. That's a lot. So figure out how much you'll need to spend on this and make sure it's doable.

And here's a pro tip. If you are going to be paying for child care, check to see if your employer offers a Dependent Care Flexible Savings Account, or FSA for short. This allows you to pay for child care expenses pre-tax up to a certain amount, and it could be a great way to save some money. Next on the list, start saving for education costs.

Now, I recommend doing this with a 529 plan or an education savings account, ESA for short. These accounts act sort of like a Roth IRA, but for your kids' higher ed expenses. And let me tell you, opening a 529 plan was one of the first things I did when my daughter was born.

because the earlier that you start, the more time you have for your money to grow with compound growth. And here's a cool way to help your kids save for college. Instead of birthday and Christmas gifts, ask your family to contribute to an education fund. Yes, it might mean one less gift to open, but if that gift was gonna be a Morgan Wallen onesie or an avocado, they'll be fine. And honestly, I'm not sure which one is less desirable. - The avocado!

Okay, the last thing on the list is start investing to build generational wealth. Before you can pass down wealth, you first have to build wealth. And the best way to do that is by investing. But you got to do it the right way. Now there's a lot to cover when it comes to investing, and this video is almost over. So check out this video to find out how to invest the smart way, a way that will set you up to build real wealth. I'll also drop a link in the description below. Thanks for watching. We'll see you next time.