If you’re expecting a baby, you’re probably feeling a mix of emotions. As much excitement as it can create, there are a lot of preparation steps that may make you feel overwhelmed. Within  the first year, raising a baby can cost anywhere between $20,000 to $50,000 according to a source on Healthline. Whether that is more or less than you expected, it’s still important to plan out your finances ahead of time.

Consider these money management tips to ease money-related stress, and allow yourself to enjoy your new bundle of joy:

Watch How Much You’re Spending 

One of the most important financial tips when it comes to preparing for a little one is to stay organized, and properly tracking your spending. Watching this closely allows you to notice when you may be spending too much, or where you could spend more. Through the use of a spending tracker app or even a notebook, you’ll have an accurate representation of your leftover funds and how much of them are available to put into a savings account (or use to splurge). The more you hold yourself accountable, the easier it is. Having this control over your finances gives you a healthier relationship with it and a clearer understanding on where you stand financially. 

Reassess Your Finances

Before the baby arrives, it’s crucial to reassess your financial standing. Doing so allows you to understand the “big picture” from how money is flowing in and out of your household. If you are a type-A personality, use a spreadsheet to stay organized and track information in real time or at the end of every week If spreadsheets aren’t your thing, consider speaking with a financial planner who can take the heavy lifting and guesswork off of your plate. 

When you reassess your finances, look at your balance weekly, bi-weekly, and monthly so you can better understand how much money you're making and spending in a specific timeframe. While you do this, you should also factor in and jot down the amount of funds in your savings account and your emergency fund (if you have one). Once you have all crucial payments written down (mortgage, credit card payments, loans, car payments, groceries, etc.), develop a separate section that includes these extra “splurging” costs you may want to take into consideration. This can consist of subscriptions to various services, like a gym membership, beauty subscription boxes, streaming service, etc. This will give you an idea of the unneeded spending you may be making each month. 

While you assess your finances, evaluate your debt-to-income ratio. You can find this percentage by calculating your total debt payments, such as mortgage, car payments, credit cards, etc., by your monthly gross income. If your percentage is 36% or lower for your debt-to-income ratio, you are considered to be in good standing. This is important to keep in mind when reassessing your finances for a new baby because lenders will often look into this before providing you with a loan to ensure you have the income to support payments for it. 

Set Attainable Goals 

If you are looking to have a better relationship with your money now that you’ll have an infant to pay for, set financial goals for you and your partner. Setting financial goals will help give you a roadmap and allow you to track your financial progress. Having these goals is also a great way to hold yourself accountable when it comes to your money. Think to yourself about if this purchase overall benefits you, your family, and if it’s worth it. 

Your credit score can directly impact your financial future. So, maybe one of your goals could be to make credit card payments on time. If this is a goal for you, take a look at the due dates for bills and credit card payments. Mark those down and hold yourself accountable to  due dates so you don’t get late fee charges. Track them in your phone calendar so you get alerts and reminders prior to when they're due. 

Another goal you could set would be ways to contribute to your savings or 401k accounts whenever you get a paycheck. Maybe you put more in your account at the beginning of the month and less at the end due to payments that you have to make. Evaluating ways you can contribute to your savings and 401k are great ways to set up your future finances for success. 

While you are setting goals, think about this: do you need those extra subscription services? Review how much you are spending on each of those services and weigh out whether or not you should keep them or get rid of them. If you have high reaching financial goals, this is something you may want to factor in and consider to ensure you can achieve them. 

Plan Out Your Finances 

After you’ve figured out how to track your spending, assess your current finances, and set goals for yourself, it’s now time to map  out your finances. This is where you plan ahead for all of the potential expenses that come along with raising your baby. 

Building your dream nursery can involve quite a hefty payment before the baby arrives, and to top it off, these costs can add up very quickly. To ensure you’re financially ready for these payments, consider looking into a personal line of credit or a credit card to handle the finances associated with minor home improvements and other necessities you need for the nursery and other rooms within your house. Give yourself 2-3 months to prepare the nursery and gather all the must-have gadgets such as a video baby monitor, bottle cleaner, smart car seat, sound machine, baby swings, etc. If the baby comes early, you’ll want to make sure you are ready for anything. 

While planning out your finances, pre-baby arrival is very important for financial success. Speak with your partner about what monthly expenses you both expect to make once your child is finally here. Being on the same wavelength and having the same expectations will allow you both to hold each other accountable and can give you comfort about where your finances will go. 

Prepare for Post-Parental Leave

If you and your spouse work a full time job, it’s imperative to think about maternal and paternal leave and what your plans are for after it ends. For most parents, there are two main options; an at-home nanny who will care for your child from the comfort of your own home, or a daycare center. To make sure that you can trust the individuals responsible for your baby, don’t be afraid to schedule an interview, or a phone call with the provider. Do your research and read reviews to make sure that other parents have had a good experience with whoever you choose to hire after parental leave is up.

This is also a good time to talk to your boss about how they can accommodate you and your family. With a lot of companies adhering to a remote culture, you could have the opportunity to do the same and work from home to be with your child more. Whatever you decided to do, just your instinct as a parent and communicate with other family members to ease nerves and stress. Leaving your baby after bonding with them for 3-4 months is not easy. Be patient with yourself while you’re transitioning back to work. 

Consider Contributing to Your Child’s Future

Even though the baby hasn’t been born yet, start thinking about how you’re going to contribute financially towards your child’s future. Different ideas could be to  start a college fund, invest in a trust fund, or contribute to a savings account dedicated to them and their needs only. All of these are great ways to support your child financially for the future once they become an age where they are more independent. Remember, educating your children at a young age about sustaining money habits is a great way to ensure they have healthy financial habits later in life. 

Having these financial plans in place before your baby arrives is a great way to prepare for life as a new parent. Having your finances in order will relieve stress, and make you feel comfortable and confident about how you’re handling your money.