Congratulations are in order to the proud parents of naturally conceived, identical triplets, Mr. and Mrs. Hepner! They defied the odds (between 1 in a million and 1 in 200 million), which were, on average, only slightly better than the odds of winning a Powerball jackpot (1 in 175 million). With such good luck clearly on their side, the Hepners may want to consider playing for that Powerball jackpot. Babies are expensive, and their expenses were just unexpectedly tripled! CNN reported that the average cost to raise a child in 2012 was $241,080. Multiplied by three, the Hepners are looking at a whopping $723,240!
Fortunately, whether you are proud parents of miracle triplets or a single bundle of joy, there are lots of ways to save on baby expenses. Let's take a look at five of the most costly aspects of raising a child and see how to save in each area:
Save on energy in every room of your home
With a new baby at home, expect your laundry pile to grow exponentially. The same can be said for the dishes accumulating in the sink. Baby clothes and linens, bottles and sippy cups. It's no wonder your energy bill suddenly skyrockets. You're using more water, electricity and gas to run your appliances from the washer and dryer to the dishwasher to the water heater.
Don't worry. SaveOnEnergy has lots of tips to help you reduce your energy consumption from the laundry room to the kitchen to the bathroom. Using energy more efficiently and shopping for a lower rate with SaveOnEnergy can help you save big!
Feed your family
Caring for an infant takes up a lot of time, leaving little room in your schedule for meal preparation. You can avoid the financial drain of eating mostly take-out meals by planning ahead and freezing family-friendly dishes like lasagnas and casseroles. Better yet, take family and friends up on their offers to help out and ask them to bring over a home-cooked meal.
When it comes to feeding Baby, the natural way is best. Not only is breastfeeding considered a healthier option for both Baby and Mom, but it's also more than $1,200 a year cheaper than formula. However, breastfeeding is not without its share of expenses. Special clothes for nursing moms can cost hundreds, not to mention the hundreds of dollars you could spend on a breast pump and bottles. To save some money, look for nursing clothes in second-hand stores or see if a friend is willing to part with her gently used nursing attire. It's not recommended to buy a pump second-hand, but there are companies that specially design pumps to be rented and returned, saving you a bundle.
Nursing isn't an option for everyone, but you can still save money on baby formula. Ask your pediatrician for free samples. Look for special deals and coupons. Sign up online to get coupons and promotions directly from brands. Formula can get pretty pricey, so being flexible about which brand you use is also a good way to get the best bargain.
Build the brain trust
Child care, early education and higher education are some of the biggest expenses when it comes to raising little ones.
The Huffington Post reports that child care for one infant can easily cost more than it takes to feed a family of four for one month. CNN reports that child care and education expenses account for 18 percent of the total cost to raise a child and average the annual cost varies from $4,600 to $15,000, depending on where you live.
If staying at home is not an option, there are ways to ease the burden of child care and education costs without sacrificing your child's safety and opportunities. Contact your employer or human resource department to see if your company offers a flexible savings program for child care. Many large employers allow you to set aside pre-tax income to offset the cost of child care. If you opt for private in-home care, get recommendations from family and friends to find an affordable and trustworthy caretaker.
The National Center for Education Statistics reported that the average cost of undergraduate tuition, room and board for 2010-2011 was $13,600 at public institutions. That's an increase of five percent over the last 10 years and nearly double the rate from 1990-1991. What will it be in 2030?
The best time to start saving for your child's college education is as soon as possible – a daunting task when you're still worrying about paying for infant child care. Luckily, there are special programs and savings accounts you can set up to create a college fund for your child. Many banks and credit unions offer Coverdell ESAs (education savings accounts) that are specifically designated to be used only for eligible expenses like tuition, room, board and books at accredited schools. ESAs allow contributions of up to $2,000 per year and distributions of the principal and earned interest are tax-free. A 529 plan is another option to help save for college expenses and avoid income tax on earnings. A 529 plan allows for greater contributions each year and some states even allow tax deductions for these contributions. A certified financial planner can help you choose the right college savings plan for your family.
Plan for the future
While you're thinking about Baby's future, don't forget to plan for the just-in-case scenarios. Find an attorney who specializes in estate planning and make a will, if you don't already have one. If you do have a will in place, be sure it's updated to provide for your newest addition.
Life insurance is another great option to be sure your family is taken care of in the event of the unthinkable. Check with your employer to see if you qualify for coverage. Employer-offered plans are often more affordable than life insurance you buy on your own. That's because employers have better bargaining power to negotiate rates for a group.
Keeping everyone healthy and happy
Finally, be sure to do your homework when it comes to health insurance. According to CNN, healthcare accounts for eight percent of the total cost of raising a child. From regular pediatric check-ups and vaccines to unplanned emergency room visits, healthcare costs can add up quickly. As with life insurance, employers can often get a better rate on health insurance because they are negotiating for a group of people rather than a single individual or family. If you're buying your own health insurance, be sure to find out if you qualify for government assistance. The maximum income to qualify for help may be higher than you think.
Sure, raising a child today is an expensive undertaking, but with a little planning and creativity, you can do it!