Health Care and Financial Checklist for New Parents

From the womb to adulthood, a child is one of God’s greatest gifts. With such a tremendous blessing, however, comes great responsibility. As a new parent, it’s essential to plan ahead of your child’s birth to be prepared for the health care and financial responsibilities accompanying your bundle of joy.

Here are seven things you can do to prepare financially for having a baby.

1. Re-examine your health coverage.

Having sufficient health coverage and using it wisely can help you reduce your medical bills. To optimize your savings, here’s what you need to do:

• Understand your plan: Take a close look at your health plan to understand the terminology, how it works and what it covers.
• Choose in-network providers: In-network pediatricians and hospitals offer discounted rates to health plan members, so contact your carrier to find in-network providers in your area.
• Know your financial responsibility:

If this is your first child and you’ll be switching to family coverage, your deductibles (what you pay before your health plan starts sharing costs with you, or co-insurance) and maximum out-of-pocket (MOOP) (the most you pay toward eligible health care expenses) will likely increase.

Your health plan provider can provide estimates for what you’ll need to pay for pregnancy care through delivery to help you.

• Check for medical bill errors: Review medical bills for accuracy and compare them to the Explanation of Benefits (EOB) you’ll receive from your health plan provider. Promptly dispute any errors.
• Add your child to your health plan: Do this within the required time frame as determined by your health plan (e.g., 60 days of birth, adoption or placement into the home).

2. Budget for new and future expenses.

• Pre-baby budget: In addition to medical expenses, consider other costs, like car seats, a crib and items to baby-proof your home. Prepare a list of what you’ll need and adjust your budget. Set limits on what you’ll spend and consider pre-owned items to keep spending under control.
• Post-delivery budget: Make a list of recurring costs that will change your household expenses for years to come, such as diapers, extra food and child care.
• Emergency fund: Children are accident-prone and pick up illnesses easily. Having extra money set aside for the unexpected can keep you out of debt.
• HSA contributions: If enrolled in a High Deductible Health Plan (HDHP), you may be eligible to save pre-tax money in a Health Savings Account (HSA). HSAs cover qualified health care expenses, such as out-of-pocket medical expenses, prescription drugs, diaper rash cream, ear thermometers and teething relief drops. Any money you contribute but don’t use will roll over to the next year and continue to grow tax-free!

3. Purchase or increase life coverage.

Life coverage provides financial protection for your family if an unexpected tragedy occurs. For young and healthy adults, term life policies may cost less than the monthly fees of many music or video streaming services. To determine the amount of life coverage you need, use this Life Insurance Calculator to enter your current assets, expenses, income and other factors that can influence your financial needs.

You can also consider a child life coverage policy, which often has very affordable rates. Consider a term policy that lasts until your child is self-sufficient.

4. Claim the Child Tax Credit.

You may be eligible for the Child Tax Credit, which can reduce your tax bill. The Child Tax Credit is a tax credit for parents with dependent children. The amount you receive is usually determined by how many children you have and your income. The credit is not automatic; you must apply for it when filing your income taxes.

5. Create your will and assign beneficiaries.

In the event of your untimely death, it is critical to have a notarized will to help avoid lengthy legal battles contesting who owns your assets and defining who will oversee your child(ren)’s finances. Also, assign beneficiaries for your life coverage and any retirement savings accounts as soon as these benefits become effective.

6. Invest in your retirement savings and start a college fund.

When a child arrives, it’s easy to forget your personal goals and long-term plans. Stay on top of retirement savings so your child doesn’t have to support you later in life.

Also, while it might not feel like an immediate priority, the sooner you start saving for school, the more options your child will have. Learn more about common saving accounts, including education savings plans, prepaid tuition plans and investment accounts.

7. Prepare your finances one step at a time.

Adding a new member to your family comes with a lengthy list of responsibilities, so don’t try to do them all at once. Prioritize and tackle the most important items on your financial to-do list first. Because medical bills will be some of your first financial obligations once you discover you and your spouse are expecting, start there. Move on to budgeting for pregnancy and then focus on the first several months of your baby’s life.

Be ready for God’s blessed gift of parenthood.

By ensuring your health plan and finances are in order, you can relax and focus your attention on the most important thing: raising your child to know the Lord and providing him or her unconditional love. For more information on health plans that align with your values on family and faith, contact us at Insurance@GuideStone.org or 1-844-INS-GUIDE (1-844-467-4843), Monday through Friday, from 7 a.m. to 6 p.m. CT.

GuideStone^® welcomes the opportunity to share this general information. However, this article is not intended to be relied upon as medical advice, diagnosis or treatment.

*JacksonHewitt.com/tax-help/tax-tips-topics/family/child-tax-credit-2024