What To Do Before You Get Pregnant
Since we've blogged about prenups and weddings, we wanted to briefly discuss the next step in the life cycle: having children. Financially speaking, here are a few things you might consider before your little ones arrive.
1. Check Your Insurance Benefits: If you have medical insurance you might determine if there are provisions in your policy that pertain to your impending parenthood. For example, you might be due a pregnancy benefit or you might be eligible to collect disability payments. In any event, be sure the policy will cover you while you're expecting. Some insurers require that you buy the policy three months before you become pregnant*.
2. Review Your Tax Options: If memory serves me correctly, you may be eligible for at least two tax credits. The first credit reimburses you for monies you spent on child care. The amount of this credit depends on your income and how much cash you dropped on day care, check the IRS's website for more info. Second, you might be eligible for $1,000 credit just for having children, but don't take it from me, you should also ask the IRS.
3. Save Money: Wherever you decide to have your child, there will be a bill. Even if you are insured, your policy probably won't cover 100% of the birthing costs. A friend of ours recently had twins, which necessitated that his wife spend 4 days in the hospital. The total bill was $20,000. He was fortunate because his policy covered everything, but I'd bet yours does not. - You might consider saving up so you won't be unexpectedly by a big bill.
Best,
James
*Jane Bryant Quinn, Making the Most Of Your Money
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11 comments:
I'd also suggest researching your company's policy on maternity/paternity leave, just so you have all the facts early. Is it paid/unpaid? if you decide to quit after the leave do you have to pay back the medical benefits? can you use your unused sick/vacation days? It may be wise to ask a trusted coworker who's been through it. In my opinion, it's better to do this BEFORE becoming pregnant so people don't start getting suspicious.
To add my two cents worth...
You also might want to keep in mind that while in theory it might be good to do the calculations about how much children can cost, this is likely to overwhelm. If parents waited until they were truly financial ready for children we would have a lot less of them. Simply put, kids do some pretty mean damage to your bottom line (for women in two ways), while their returns are in kind.
Not having done it myself, I would think it would be good to consider what your budget would look like in the future to get a realistic perspective. I would likely talk to other couples in my demographic to see what impacts they have felt from children.
Waiting for kids to be affordable with never happen, but being prepared will greatly help.
Good luck!
Miel
"What To Do Before You Get Pregnant"
At first, I thought this title meant what to do immediately before getting pregnant and I said, "Don't they teach that in school nowadays?"
I'm not so sure why you were so quick to assume my insurance wouldn't cover my hospital costs for delivering twins...I'm pregnant with them now and should only have to spend $250 for my hospital stay....You'd have to have a pretty damn bad policy to get stuck with a $20,000 bill....
Just to clarify on the bill, the point was that if you DON'T have ensure, or have a bad policy, then you could be stuck with some pretty huge bills.
You also never know what the situation might be when you get pregnant. A good friend of mine from high school had premature triples, and called one of them her million dollar baby because she was in the hospital ICU for over six months.
If parents waited until they were truly financial ready for children we would have a lot less of them. "
I'd like to comment on this as this issue is somewhat personal to me.
While this makes sense financially, women have other issues to consider which may be just as if not more compelling, especially for women who really want children.
There are many health reasons why it makes sense to have children earlier rather than later:
1. it is more difficult for 30-something woman to get pregnant than 20-something. Yes we all know about some 40-something woman giving birth, but statistically our fertility goes down as we get older. Unlike men who produce sperm every time, we are born with all our eggs. The older we get, the older our eggs are and the less of them we have left.
2. The risks of some conditions like Down syndrome increase significantly with mother's age.
3. Women who have children before 25 have lower breast cancer risk then childless women. The women who have children after 30 have increased risk of breast cancer later in life, even higher than that of childless women. The older you are at the age of your first birth the higher your risk is. Now, this is a relative risk increase, and it might not be big in absolute terms, but it is something to consider.
Why this is personal to me. I have POF - premature ovarian failure. My ovaries stopped working when I was in my 30s and was still hoping to have children. I wish I hadn't waited. I wish I could turn back the clock and make different decisions.
Now this condition is rare, but while it only affects 1/1000 women in their 20s, it affects between 1 and 5% women in their 30s (more likely the older you are). Once the ovaries fail there is no way to have children except with donor eggs (there is a slim chance of getting pregnant naturally, but...) So you really never know if or when you ability of having children is taken away from you.
So when deciding if you want to postpone having children, consider health issues as well as monetary issues. I strongly suggest at looking at the charts of a) how much fertility decreases with age and b) how much Down Syndrome risk increases with mother's age.
Thanks for your comment Diora. Your points are well taken. It seems that my statement of "If parents waited until they were truly financial ready for children we would have a lot less of them," wasn't received in the same way I had intended it.
What I was trying to get across was that there are many other issues to consider when thinking of children. If people got hung up on the cost of children we would likely have a lower birth rate.
Children are an investment of a different kind. Arguably worth all the money they take and then some. Having children has unquanitifiable returns, and much more valuable than those in a bank account. Thus while it is important to consider finanace, don't let this hold you back from having childen when you are ready to do so, even if this means a limited budget.
Hope that makes more sense to readers.
As an aside, we also understand the implication of it being harder to have children later in life. I just turned thirty last week and am aware of my limited egg situation. At the moment, while I will be done with my masters very soon, I am also the main bread winner in our household. Thus we don't really have the means to have children until James is done with his masters in a couple of years. Whether we like or not we are a bit constrained by living in 600 sq ft on mostly one income. Such is life, and we will make the best of the choices we have made.
While we do wish to have children in the future, we are choosing to hold off for now.
Plus we'd have to find a new blog name! ;-)
Miel
My suggestions would be:
Buy a house BEFORE you have children.
Wanting to take a great vacation--backpacking, scuba diving, Europe??? do it NOW--BEFORE you have children.
Have an emergency fund set up. There are always emergencies with kids.
Get a physical BEFORE you start trying to get pregnant. Quit/modify your bad, expensive habits.
Take prenatal vitamins while you are trying to conceive (spina bifida is an expensive mostly preventable disease--but it occurs, in the very beginning stages of pregnancy).
Buy a house, BEFORE you have children.
Have an emergency fund set up.
Get a physical before you get pg.
Take prenatal vitamins 6 months prior to getting pg. (birth defects are expensive in more ways than one)
Wanting to go backpacking across Europe, do it NOW, before you have kids. Don't spend the next 20 years complaining about what you "could've" done if you didn't have them.
About the hospital pg bill issue: I have three insurance plans to choose from through my employer. My understanding, after talking with some new moms in my workplace, is that the different plans vary considerably in both premiums and coverage. For example, if I were to get pregnant while under my current plan (the mid-range choice), I'd be responsible for 20% of the total cost. That can get pretty spendy if there happens to be a complication, or in the case of twins! With the higher-premium plan, of course I pay more in premiums, but the costs associated with the pregnancy are covered in full - 100%. That's why it's smart to plan ahead when possible.
Also, none of my business, but I completely understand where Diora's coming from, and I'd highly advise women, even in their late 20s, to reconsider waiting to have children, or at least stopping taking hormonal birth control so their bodies are ready to get pregnant as soon as they are. I'll be 30 in Nov. and I waited until I got my career going, was happily married and had our finances in order. Now, I'm learning it's not as easy as I'd always thought to become pregnant!
James and Miel,
I think until you are 35 your odds are still with you. I just wanted to point out that there are other issues to consider, not just money.
At any rate, I think everyone should make decisions regarding their specific situation and what course of action they are less likely to regret some years down the line.
You are absolutely right that if everyone waited until they have enough money (or have a house or had travelled enough) we'd have a lot less children. We'll also have a lot more of special needs children as well - both because of risk of Down increases exponentially with mother's age and, as was recently shown, the risk of some other things with father's age (although until he is 40 it is not much of an issue).
Here is a link to a blog post by an ObGyn that shows graphs of fertility rate/rate of miscarriage with age:
http://theblogthatatemanhattan.blogspot.com/2006/01/how-to-get-pregnant-part-ii-biological.html It does seem that 35 is more of a "magical line" than 30, though.
One thing that this doctor mentions is the possibility of freezing one's eggs just in case. I certainly wish this option was available when I was young.
Again, I am not exactly objective when it comes to this issue for the obvious reason.
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