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Planning Financially for Your First Child

Expecting your first child can be an exciting and overwhelming journey but one of the most important things to think about is how to prepare financially for a brand-new addition to your family.

It’s no secret that there are tremendous costs that come with raising a child but there are ways that you can prepare, ensuring you give your children the opportunities they deserve. Knowing what expenses to expect is the first step and in this article, we discuss some of these expenses.

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Financial Planning for New Parents

Here are some of the biggest financial considerations that new parents should me making.

Maternity Leave

Pregnant people should speak to their employers about their maternity leave benefits as soon as their pregnancy has been confirmed. Working mothers who contribute towards UIF in South Africa can claim for up to 121 days of paid maternity leave. Most companies offer between 38% and 58% of your gross salary.

However, it’s important to note that you can only submit your UIF application once you are no longer receiving your full salary and it can take several weeks for your application to be approved. Therefore, it’s advisable to start putting some money aside to cover your costs while you wait for your UIF to be paid out.

General Baby Budget

Child related costs don’t only start when your child is born. In fact, there is a lot to think about before your child arrives. Preparing for the arrival of your newborn starts with:

  • Equipping the nursery with everything you need such as:
    • Cot
    • Changing stand
    • Night light
    • Baby monitor
    • Nursing chair
    • Bedding
  • Stockpiling of items such as
    • Nappies
    • Bottles
    • Dummies
    • Baby wipes
    • Clothing
    • Baby powder
    • Nappy rash cream
  • Baby proofing your home
    • Plug points
    • Sharp corners
    • Safety gates for the top of stairs
    • Installing fencing around the pool
    • Pool covers
  • Larger purchases
    • Prams
    • Car chairs
    • Potential vehicle upgrade to accommodate a bigger family

Looking at these costs, there are some that you will need to prioritize based on your child’s age. For example, fencing around the pool is not necessary until your child is more mobile but you will still need to put money aside to cover that expense when it comes time to. So, it’s a good idea to set out a budget which is aligned with the timeline of your child’s development.

Medical Cover

Although you can only add your newborn as a dependent to your medical aid once they are born, it’s a good idea to start investigating what medical aid and plan will best suit your individual needs so that you can either make the switch to your chosen medical aid, or prepare for the additional premium you will need to pay on your current medical aid.

Additionally, most medical aids offer generous maternity benefits that are separate to your day-to-day benefits. So make sure that you activate these so that you don’t pay for scans, antenatal consultations, screening, and blood tests from your savings benefits or straight out of your pocket.

Lastly, make sure you know which hospital is on your medical aid’s list of designated service providers and find out to what extent your medical aid will pay for birth, especially if you want to have a midwife or doula assisted birth. Not all medical aids cover these services, so you will need to prepare for the costs by putting money aside throughout your pregnancy.

Life Cover

Unfortunately, death is a part of life and when you have a baby on the way, it’s time to think about how you will provide for your child if something happens to you. The best way to do this is with life cover.

When speaking to one of our financial advisors about life cover, you will want to ask the following questions:

  • What financial impact would the loss of my income have on my family?
  • What debt do I have that will need to be settled?
  • How much income will my family need to replace mine?
  • How will my child pay for their education?
  • How will my family pay for the rent or bond on my home?

Navigating this territory can feel daunting, but our financial advisors in Johannesburg are there to assist you with making sure your child will have the financial resources they need in the event of your death.


Education is an ongoing expense that parents have and, depending on what or where your child will continue their tertiary education, you may be looking at paying for education until your child is in their 20’s. This means that you will be paying school and university fees for at least 15 years.

For this reason, it’s important to start saving for your child’s education as soon as you can because the average salary in South Africa is not enough to pay for high quality education. There are a number of valuable savings vehicles that you can invest in to help you cover these costs, without digging into your life’s savings. Knowing which vehicle is the best can be tricky, especially if you don’t have an understanding of how the markets work but our financial advisors can assist you with this process.

Throughout your child’s life, they will also want or need to take part in extra-mural activities such as:

  • Swimming lessons
  • Tutoring
  • School sports
  • Art lessons
  • Horse riding
  • Music lessons

These are all additional costs to school and university tuition and will require you to have money in the bank. Factor these into your budget so that you can soften the financial blow that these activities bring with them.


Unless you are a stay-at-home parent, childcare is something that you should include in your baby budget. Parents who need to go back to work after their maternity leave usually have the choice between enrolling their child in a full-time daycare facility or employing a full-time nanny to take care of the child at home.

Should you choose to have a full-time nanny at home, you may need to pay for additional training for them to make sure they are adequately equipped to deal with emergencies. This may include basic to advanced first aid training, driving lessons, and swim training to name a few.

Olemera Financial Services – Financial Planners in Johannesburg

This may all feel extremely overwhelming for first-time parents but our team of financial advisors in Johannesburg are trained to help set you up for financial success. There is no reason for a child to break the bank. The important thing is to get your financial ducks in a row, so that you can continue working towards your own dreams, while helping your child realize theirs.

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