Ready to Add a Little One to Your Family? 6 Things to Consider

Adding a treasured new member to your family can be a lot of work. Here is a checklist to help you plan for the big day and beyond.

Updated: September 2026.

Determine the new expenses.

Consider the immediate and longer-term costs of raising a child. Be ready for things like:

• Healthcare for the birthing parent and child

  • Provider visits

  • Increased healthcare premium

• Feeding supplies

  • Bottles

  • Breast pump (often covered by insurance — check your plan)

  • Nursing-friendly clothes

  • Formula

• Diapers or diaper service and related items (trash bins, laundry bins, etc.)

• Loss of income due to parental leave

• Postpartum support like a doula or nurse

• Professional childcare such as daycare or a nanny. In many areas you'll need to join waitlists while you're still pregnant.

• Services like grocery delivery and house cleaners

• Education expenses from pre-K to post-grad

• Increases to overall living expenses: utilities, food, vacations, and so on.

Occasional and one-time expenses are one of the top contributors to going over budget in any situation. These expenses tend to slide under the radar.

• Car seat

• Stroller

• Bedding

• Baby furniture (crib, changing station, bassinet, high chair)

• Clothing

• Toys & books

• Childproofing

Adding people to your household might strain the physical space you have:

• Will you need a larger car that can fit rear-facing car seats and all your gear?

• Will you need to remodel to add space or move to a larger home?

Consider starting a contingency fund in case your estimates are low. It's hard to predict everything you'll need even with a checklist. Track your spending as expenses start rolling in and update your budget until you settle in.

Be wary of the intense marketing you will face from your favorite retail sites, social media, and the internet in general. Consider talking with peers who are parents about what you really need and what they found genuinely useful. Try to make do with what you have before diving into new expenses.

Know the benefits offered by your employer and state.

Employers can offer a wide range of benefits that kick in when adding a child. States can offer programs that extend your leave options or even partially cover lost income while on leave.

• How much paid birthing and bonding leave do you get? There could be both medical and parental leaves available to you.

• Do you have short-term disability coverage? It often replaces part of your income while you recover from birth.

• Does your state offer any paid family leave programs?

• Does your employer or state offer extended leave beyond FMLA?

• Do you get any childcare subsidies or benefits?

• Do you get reimbursed for adoption expenses?

• Does it make sense to contribute to a Dependent Care Flexible Spending Account for qualified childcare expenses? Note that you can't use the same expenses for both an FSA and the Child and Dependent Care Credit.

Figure out the impact to your near-term budget.

With a sense of expenses and potential loss of income in hand, start by looking at near-term cash flows, then look at the longer-term picture to understand the impact of potentially reduced saving over time.

• Do you need to find old expenses to cut to make new expenses fit your income?

• Is your emergency fund still sufficient to cover new types of emergencies?

• If you need funds for medical expenses and you have an HSA, don't forget about that as a potential source.

• Need another $5,000? Each parent can take a "Qualified Birth or Adoption Distribution" from certain retirement plans. This will increase your income tax liability, so be careful.

Update your insurance.

Healthcare, life, and disability insurance should be reviewed in light of your new child. If giving birth, you'll also be asked to name a pediatrician from day one.

• If you are a two-parent household, who will add your child to their health insurance policy? Does the same healthcare plan make sense or do you need something with a higher or lower deductible?

  • You generally have 30-60 days to make this change.

• Find a pediatrician in your plan's network.

• Does it make sense to increase your HSA contributions if you have one?

• Is your life insurance and disability coverage enough to cover your child's expenses and education goals?

Prepare for tax day.

Knowing what will happen to your tax situation lets you get the deductions and credits you deserve. Check the tax rules for each of the following cases to see if you qualify:

• If unmarried, check whether your filing status changes to Head of Household.

• Determine if you qualify for the Child Tax Credit.

• Check if you qualify for the Child and Dependent Care Credit.

• If you adopted a child, you might qualify for the Adoption Tax Credit.

• Check with your state for the process to obtain a birth certificate and get a Social Security number for your baby.

• Once the Social Security number arrives, consider freezing your child's credit so no one can open accounts in their name.

• Finally, if you need the extra cash in your paycheck, try to reduce your tax withholding by updating your W-4. Use the IRS Tax Withholding Estimator.

Revisit your long-term financial and estate plans.

Reduced savings over time and new goals can impact your long-term financial plan. Understanding your plan early gives you plenty of time to adjust and achieve your goals.

• Which of your financial goals still make sense? Are there any goals to add or drop?

  • More family vacations

  • A different automobile for your family - or one for your child, eventually

  • Would you plan to help pay for a wedding someday?

  • Would you want to help with a downpayment for your child's first home?

• Which education expenses do you plan to fund? Will you use a prepaid program, 529 plan, or another approach?

• How does the timeline for your goals change?

• Consider setting up a custodial account (UGMA or UTMA) or a 529 account for cash gifts. Be aware of the impact that gifting cash directly to your child will have on eligibility for financial aid.

• 530A accounts are a new way to save for your children's retirements. Children born between 2025-2028 can get $1,000 seed money from the federal government, but it isn't automatic — you have to claim it by filing Form 4547.

• Start or review your estate plan.

  • Put your own will, healthcare directive, and power of attorney in place.

  • Create trusts and appoint trustees to take care of assets for children.

  • Appoint a guardian to take care of the child's non-financial issues.

  • Update beneficiaries on all accounts to match your estate plan.

Bringing a child into your family is a remarkable journey filled with love and challenges. By doing a little planning along the way, you can create a secure and nurturing environment for your growing family.

If you're expecting — or hoping to be — we'd be glad to help you work through your own version of this checklist. Use the contact form below to get in touch.