With the arrival of our new baby, my wife and I revisited a few key areas of our financial plan — and these are the same five I encourage not only new parents, but also families with multiple children!

Expenses rise quickly with a baby — diapers, childcare, medical costs, and all the surprises that come with parenthood. A stronger cash cushion helps absorb those shocks without adding financial stress.

As a rule of thumb, aim for 3–6 months of living expenses.

Lean toward the higher end (closer to 6 months) if:

• Only one spouse works or earns the majority of the income
• You and your spouse work in similar industries or for the same company

This is all about protecting your family from income disruption or unexpected costs.

A baby changes your healthcare needs — and possibly your best coverage option.

If you and your spouse are generally healthy and only see the doctor for preventive visits, a high deductible health plan (HDHP) with an HSA may make sense. You’ll save on monthly premiums and get tax advantages from HSA contributions.

However, families who expect regular doctor visits, prescriptions, or specialist care might benefit more from a traditional PPO or HMO. While premiums are higher, deductibles are lower and costs are more predictable.

The right plan depends on your family’s expected medical usage — review it annually as life changes.

People all the time say they already have life insurance through their employer, but often it’s only 1–2× your salary — not nearly enough to replace your income for your family. Plus, it usually doesn’t follow you if you change jobs.

A personally owned life insurance policy ensures your coverage stays with you and fully protects your loved ones through every career move.

Review both employer and private coverage to make sure your family’s needs are met.

Every sound financial plan starts with knowing your cash flow:

Childcare costs, parental leave, or a spouse going part-time can all shift this equation. In my experience, most people underestimate their variable spending — dining out, on-line orders, entertainment, etc.

Tracking those can reveal opportunities to save without major lifestyle changes.

When things feel tight, start by reviewing your variable expenses. Awareness alone often creates meaningful improvement.

There are several great ways to invest for your child’s future — each with different benefits.

Designed for education expenses including up to $10,000 for K–12. Earnings have the potential to grow tax-free when used for qualified education costs — a major advantage.

These accounts are in your child’s name but managed by you. Once your child reaches the age of majority, the money becomes theirs — which can be a plus or a risk depending on their maturity level.

Created under the One Big Beautiful Bill Act (July 2025), these new accounts will launch in 2026.

• Funded initially with $1,000 from the government for children born 2025–2028
• Parents will be able to contribute up to $5,000 per year, with no income limits
• Earnings will have the potential to grow tax-deferred and become taxable upon withdrawal (like a traditional IRA)
• Withdrawals are restricted until age 18

More guidance is expected, but this may be advantageous for someone who is in a lower income tax bracket.

Becoming a parent changes everything — including how you think about money.

The key is to plan intentionally before the sleepless nights begin.

Small, proactive adjustments today can help create long-term stability for your growing family.