Getting your finances in order

Review your budget

Compare your income against your expenses. There are costs involved in starting a family as well as ongoing costs. Make sure to add any new costs to your budget. Adding new expenses may mean you have less money to spend on other things.

You may need to take time off work to care for a newborn or newly adopted child. You'll probably make less money while you’re on maternity or parental leave. To prepare for this, you can practise living on a reduced income before your child arrives.

Needs and wants

Take a good look at your needs and wants because they may change as you start your family.

A need is something that is necessary, required or essential.

A want is something that you'd like, but don’t necessarily need.

For example, you may need to put more money towards needs, such as a crib, stroller, diapers or formula.

Money saving tips for baby shopping

Here are some tips to help you save money when shopping around for some of the more expensive items your family may need:

  • sign up for a baby registry in case your friends and family would like to get you a gift so they will know what items you need
  • consider buying second-hand or asking your friends and family for used items
    • make sure items such as cribs, furniture and car seats are still safe for your child
  • shop around for new items to ensure you get the best price possible

To help you create and maintain your budget:

Reduce your debts

If you owe money, figure out how much you owe. Reducing your debts will allow you to have more money to put towards child-related costs or other financial goals, such as saving for your child’s education.

Find out how to make a plan to be debt-free.

Increase your savings

It’s a good idea to increase your savings. Your savings may help you to buy large-ticket items like a crib or stroller, deal with an emergency or allow you to start saving for your child’s education.

To help you save, set up an automatic transfer from your current bank account or consider putting any government benefits you get for your child into:

Child care costs

If you need child care, it may be your largest child-related expense. Even when your child is old enough to go to school, you may still have expenses for before- and after-school care, summer camps and other activities.

Child care options

The cost of child care will depend on the option you choose and where you live.

Some child care options include:

  • daycare centres, which tend to be more expensive, depending on where you live
  • home or private daycares, which offer child care out of somebody’s home
  • a family member
  • having one parent stay at home

If you or your spouse or partner decides to stay home, consider what the lost income will mean for your family budget. You may avoid child care costs, but you may also have less money overall to cover your expenses.

You may be eligible for tax credits to help with the cost of child care.

Claim child care expenses on your tax return.

Adoption and fertility treatment costs

To start your family, you may need to budget for adoption costs or fertility treatments. Research your options and develop a savings plan. You may also want to check with your employer to see if it covers adoption or fertility expenses.

The cost of private adoption services in Canada varies depending on where you live and where you're adopting from. It can range from about $10,000 to $30,000.

The cost of fertility treatments will vary depending on the type of treatment you get.

If you take out a loan or use a line of credit to pay for adoption expenses or fertility treatments, remember to plan for the repayments in your budget.

Claim your adoption and fertility treatment costs

You may be able to claim adoption expenses and some medical expenses, such as fertility drugs, on your tax return. Certain provincial and territorial health plans may also cover a portion of fertility treatments. Check your employer’s benefit plan to see if it covers adoption or fertility expenses.

Find out if you can claim adoption and fertility treatment costs on your tax return.

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