Being Financially Ready for Baby

One remarkable thing about having a baby is that you usually have at least a few months to prepare for him/her – even if your pregnancy is unexpected. And if it’s planned, then you have time to ensure that you are ready as possible for the baby, financially.

Canadians can take up to 18 months off between maternity and parental leaves. In British Columbia, the mat leave is 17 weeks, parental being 35 weeks.

Here are a few tips to be financially ready for baby:

Figure-out Your Maternity Benefits

Maternity leave benefits are administered by Service Canada, under the Employment Insurance Act. To qualify, you need to have worked a minimum of 600 hours in the 52 previous weeks and your employer needs to have paid the applicable EI premium.

The maximum amount you can receive in 2023 in $ 650.00 gross per week. You will pay income tax on the payments. The benefit is usually 55% of your salary.

Note that if you choose to take the extended parental leave -18 months-, your weekly benefit will be reduced.

Don’t forget to look at the Canada Child Benefit (CCB).

This will not get you very far, unfortunately, as babies come with additional expenses. The cost of both formula, diapers and clothes can really add-up.

Talk to Your Employer

If you have a job, you’ll want to inform your employer as soon as you can once your first trimester is over. You can find out about if your employer offers a top-up. In Canada, an employee on mat leave is still considered to be an employee of the company.

Thus, you retain both your seniority and your benefits. Also, your employer can’t fire you.

Start Tracking both Your Income and Expenses

You need to know how much money you will need during your mat/parental leave. If you make $ 3 000 a month, spend $ 2 500 and your benefits will be $ 1 500 per month, you have a shortfall of $ 500.

Tip # 1: If you have a partner and both of you are employed, you are receiving 4 paychecks per month. Try to live on 3 and save the 4th one.

Tip # 2: stockpile on diapers, formula and other baby items while you’re still working. It’ll be easier financially when your child is born.

Go on a Money Diet

It can be tempting to use this time to have a good time instead of a smart one. But if you haven’t done much financial planning until the pregnancy, you may need to use this time to stop spending on anything not needed to give yourself a cushion.

I’d also suggest postponing major purchases. Because you’re pregnant doesn’t mean you need a brand new car.

Pay Down Consumer Debt

If you have any consumer debt and are now pregnant, use this time to pay down all that debt. As you pay it down, your credit will improve, and you might be able to lower your interest rate too. Call your creditors and try to work that out.

Source Supplies from Thrift and Gently Used Stores

Even if you can afford to buy all new stuff at the highest prices, why would you do that?

Babies outgrow their clothes very fast. They also can’t read labels so you don’t need to spend a fortune on designer clothes. Buy second hand.

Have a Baby Shower

Any item received from family, friends and co-workers is one you won’t have to purchase.

Have your Legal Affairs in Order

Now that a new life is coming your way, you need to ensure your baby is covered should something happen to you. Check your life insurance policy and have a will in place.

Check the Availability & Cost of Daycare

If you plan to put your child in daycare at any point in the future, it’s best to check out that situation now in your area. Some childcare centers have long wait lists that require you to get on the list, or you won’t get a slot.

It’s also no uncommon to have to pay for a fee to be included on the waiting list.

A spot in a licensed daycare in BC costs close to $ 1 300/month for infants and toddlers. The BC government has recently introduced the Affordable Child Care Benefit, to help families with those costs.

Don’t Steal from Your Retirement

As you plan for your baby’s arrival, avoid taking from your retirement fund. The truth is, a comfortable retirement where your child doesn’t have to take care of you, is the best gift for your child.

Final Word

It may well be you can’t afford to take a full year of mat leave. But with a little planning, you will definitely be able to take more time off, without the added financial stress.


  1. A lot of parents do not plan ahead financially. I definitely didn’t not plan enough with our first child. Babies are more expensive than they seem! Future parents should also ensure their baby is added to their group benefits, if they have any. It is easy to overlook. It happened to us. We had to pay for some medical expenses out of pocket because we forgot to communicate with our insurer.


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