Can you afford a baby?


Posted at Jun 24 2014 11:36 AM | Updated as of Jun 25 2014 05:12 PM

MANILA, Philippines - A baby’s arrival into a family is always marked by great changes. The peace and quiet that once reigned in the home is suddenly disrupted by the baby’s laughter and cries; new furniture, toys and accessories are suddenly strewn everywhere in the house; mealtimes now include milk and cereal; and just about everything will begin to revolve around the new family member.

As a member of your family, your baby will be part of everything you do—from grocery visits to holiday vacations—and will influence every facet of your life, including your career, business, and even your choice of home and car. Expectedly, there will be both big expenses such as tuition fees, child care, and health care costs, as well as many small ones like purchases of toys, entertainment, clothes, and gifts, to name a few.

Needless to say, a baby’s arrival has lifelong financial implications that parents should prepare for, starting from childbirth all the way to adulthood. If you are planning to have a baby soon, or have recently had a new one, expect to make adjustments to your lifestyle and finances.

Here are some areas you need to look at closely to make sure no surprises for your budget:

Your date with the stork.

Your first major expense will be the cost of childbirth. Find out how much your chosen obstetrician will charge in professional fees so that you can set aside funds for this. Many hospitals offer a package that includes the doctors’ fees, hospitalization charges, regular check-ups, and other related fees. Compare and choose from among your options to come up with something that works best for you. If you have medical insurance, find out if this is covered. Check out and update your Philhealth coverage as well.

Time off to nurture.

When the mother gives birth, she will have to take a break from work. Philippine law provides for 60 calendar days off for a normal pregnancy and 75 calendar days off for birth by caesarian section. For some working mothers, this disruption might mean less or no income, so take this into consideration when planning your cash flow.

If you are working, check out your benefits and fill up forms that you might have to attend to in advance. Some companies give paid maternity leaves, and SSS also gives a maternity benefit. Fathers, on the other hand, are entitled to a paternity leave under the law. If you are employed, be aware that realistically, you will probably be taking some days off from work every so often to attend to unforeseen needs of the baby, which will be heaviest in the first 2 years of life.

If you used to make a good sum from doing overtime work, also expect that realistically, you may not be able to render as many hours in overtime work while your baby is very young.

Cost of Child care.

When the baby is born and when he is still young, you will need to make arrangements for his full-time care. Some mothers leave the work force to become a full-time stay-at-home mom, either permanently or for a short period. Alternatively, many working mothers employ the services of a full-time nanny (yaya). Others ask relatives to care for their children, while others leave their children at a day care center.

Work out an arrangement that is most suited for your circumstances. Whichever alternative you choose, expect child care costs to account for a major portion of your baby-related expenses.

Health is wealth (and expensive).

A new baby means many visits to the pediatricians. If you are lucky, these visits will just be for the administration of routine vaccinations. However, most children go through many illnesses in early childhood–respiratory tract infections, viral illness, diarrhea—that will require you to make a quick trip to the doctor. If you are employed and have health insurance or coverage from a health maintenance organization (HMO), find out if your baby may also be covered. Learn about the procedures to avail of these services.

Protect your future.

Now that you have a baby, you will have to think of ways to manage life’s uncertainties, like how to provide for your family’s needs in the unfortunate event that you pass away early or get disabled. This may be an opportune time to consider taking out a life insurance policy which is always cheaper to purchase when you are younger.

Invest in education (yes, this early!).

It is never too early to prepare for your baby’s education. At around 4, he will begin to attend preschool, and will continue to be in school for the next 15 years or so. Needless to say, the cost of education will account for a substantial part of the family’s budget, so it is something that you should begin to anticipate and plan for as early as you can.

Since the arrival of the baby heralds major changes in your life, it may be time to think about your life plans. Think of your life goals, the timetable with which you want to achieve these, and set up a financial plan to make this possible, taking into consideration the needs and wants of your now expanded family.

In the meantime, enjoy your bundle your joy!

Grow Your Money is an editorial partnership between and Citi Philippines to promote financial education and provide helpful information to Filipinos on how to better manage their personal finances.

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