Your Quick Guide to Being a Financially-Savvy Mom
Author: Guest post by Alissa Todd, Wealth Advisor at The Wealth Consulting Group
If you’ve had a baby recently or are preparing for his or her arrival, you are probably experiencing a variety of emotions. While it’s easy to blame the hormones, the fact is that many areas in your life are about to dramatically change, including your finances. To better prepare for your growing family, here are some financial tips to consider as you transition into the exciting journey of motherhood:
How to become a Financially Savvy Mom
Shop Resale for Baby Items
Facebook Marketplace is golden for baby items. There are also second-hand stores specifically for baby and children items. Oftentimes, baby items still have tags on them! Your baby is going to outgrow clothes and toys so quickly that you can save money by looking at resale locations instead of buying items brand new.
Budget for Mama's Day Out
You deserve this and it is so important to do something for yourself! Write out a list of activities that bring you joy along with the cost next to it. Then budget monthly self-care time using that list.
Pro tip: Talk to other moms for recommendations on a good babysitter. Make sure you interview the person before the big event. . Although a good babysitter can be expensive, it’s so worth getting out with your partner!
Enjoy Free Events
Money can get tight with a new addition to the family, but don’t worry there are plenty of free activities for the whole family to enjoy. The library often hosts community events during the daytime and on weekends.Check out MeetUp and Facebook for local mom support groups as well.
Plan for Your Financial Future
Having a child changes your financial picture drastically. During this time of transition, working with a financial advisor can provide stability and clarity as you plan for this new phase of your life. A couple of questions to ask yourself and your advisor:
- What can I do to prepare for education?
- Should I look into life insurance to protect my family?
- How can I set up my family for financial freedom?
529 College Savings Plans
529 plans are college savings plans. They grow tax-free if used for qualified education expenses. These contributions are made with after-tax dollars. Contributions do not qualify for a federal income tax deduction, but some states offer a state income tax deduction. This varies by state.
Dependent Care FSA
One way to set aside money for daycare or other childcare-related costs is to check with your employer to see if a dependent care FSA is available. The maximum contribution is $5,000. It is important to note that FSA’s have a “use it or lose it rule” so budgeting for dependent care expenses should be done annually before contributing to an FSA.
Make sure that you have a conversation with your HR and the daycare facility to confirm that they can accept FSA payments.
You've Got this Mama!
As you navigate through the journey of motherhood, it may seem overwhelming to tackle your finances at the same time. Oftentimes, talking to your partner, other mamas or a trusted financial advisor can actually help relieve the stress and confusion around money.
By taking advantage of resale, free community events and adding self-care and financial planning now, your future self will thank you later.
The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual.
Prior to investing in a 529 Plan investors should consider whether the investor's or designated beneficiary's home state offers any state tax or other state benefits such as financial aid, scholarship funds, and protection from creditors that are only available for investments in such state's qualified tuition program. Withdrawals used for qualified expenses are federally tax free. Tax treatment at the state level may vary. Please consult with your tax advisor before investing.
Alissa Todd is a registered representative with, and securities are offered through LPL Financial, Member FINRA/SIPC. Investment advice offered through WCG Wealth Advisors, a registered investment advisor. WCG Wealth Advisors and The Wealth Consulting Group are separate entities from LPL Financial.
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