Becoming a first-time parent is full of uncertainty. Not only do you have another human life to suddenly care for, but you also have to rethink your entire financial future. Here are a few financial tips for new parents, beginning with preparation before the baby even comes.

As with all other financial matters, preparation is everything. The more you can set aside for baby expenses, the better. Put a list together of essentials vs wants. Diapers and formula are two examples of essentials, whereas a diaper genie is more of a luxury item. If you and your spouse are both students or employed, you will need to be able to afford daycare, so make sure you take full advantage of any childcare tax plans. It’s also important to think ahead about the long-term expenses and tax breaks for you and your growing family. The average cost of raising a child through age 17 is approximately $280,000. This is for housing, food, and education. If you are interested in sending your child to college, you should set up a 529 account as early as possible so it can accrue interest. You and your child can make tax-free withdrawals for school-related expenses down the line. Years of compound interest are another reason to open a Roth IRA in your child’s name when they are little. The aim is to have a nest egg for them once they’re older. 

When choosing your baby registry, go for practical instead of fanciful. A package of diapers will come in much handier than a cute rattle. If you know the gender of your baby ahead of time, start asking close friends and relatives for any gently used baby clothes and toys. Your baby is not going to know the difference and you will save a fortune on items that he/she will only require a few times. In addition, thrift stores and consignment shops have come a long way. There are many great deals to be found for a rapidly-growing baby.

Lastly, do not assume that your healthcare provider has automatically added your newborn to your health insurance plan. This life event is not an automatic process. You generally have between 30-60 days to notify your carrier about the new addition to your family.