How Much We’re Spending On Baby #2

Baby #2 is due in just a few months! Which feels so crazy! While this is such a fun and exciting time, of course we’re also preparing for it in our budget. Here’s how much we’re budgeting for and planning to spend on baby #2.

Baby Makes Four

We are so excited to add another baby boy to our family in June 2022! Our first son, Peter, will be just over 2 years old when little brother is born. I think this makes me officially a boy mom and I’ll proudly wear that title. 🙂

It’s no secret that having kids can be expensive… But one way we’re working to combat that is planning for our spending through a budget! I learned soooo much when it came to budgeting for having a baby when we had our first son, so I feel so much more prepared this time around.

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Our Baby Budget

I have broken down our baby budget into a few categories. Here’s how much we plan to spend in each.

I love to share on my platforms that it’s important to spend money on the things that are important to you. So we’ve allocated money in our baby budget for the things that are important to us! This will look different for everyone and that’s okay.

Medical Costs – $6,000

In the United States, this may be the biggest expense to plan for when having a baby. It can also be confusing!

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We are on a family insurance plan through my husband’s employer. This year we’re on a high deductible health plan (HDHP) and our family max out of pocket is $6,000 for the year (honestly pretty low for a HDHP). When I gave birth to my first son (standard vaginal birth with epidural), Peter, I was on a PPO insurance plan on my own but ended up hitting the max out of pocket on my own individual plan.

Every insurance plan and provider is different so you definitely need to talk with your insurance provider about cost estimates for your specific situation, but in our case, we’re planning for worst case of hitting the family max out of pocket of $6,000.

With our HDHP we will pay up to the deductible ($3,000 in our case) for everything before insurance kicks in. Once insurance kicks in, they will cover 80% and we’ll cover 20% up until that max out of pocket of $6,000. It’s such a relief to know that we have insurance and will only be responsible for $6,000 in the worst case scenario.

The best perk of being on a HDHP is the benefit of a health savings account (HSA). I LOVE the HSA. It has the possibility of being used with a triple tax advantage. You can put money in before taxes, have the opportunity to invest those dollars and it grows tax free, and then you can use the money from the HSA to be used on qualified medical expenses tax free! It’s pretty awesome.

The ONLY way to open an HSA is to be on a qualified HDHP insurance plan.

The contribution limit for the HSA on a family plan for 2022 is $7,300. We are planning to max out the contributions for the HSA this year! But we’re also planning to utilize the triple tax advantage that the HSA has to offer. So our plan is to pay for our medical expenses our of pocket and let our HSA grow over time. We will be saving all our receipts for qualified medical expenses this year so that we can pull money from the HSA at a time in the future.

Maternity Leave Supplementation – $0

If you’re planning to take some unpaid time off for maternity leave, it’s great to plan ahead and save for it!

Now I’m fully self employed. So I don’t get any kind of maternity leave… But I am planning ahead to take some time off. I hope to take maybe 6-8 weeks off. But being self employed means that I just need to plan ahead! Right now I’m a few months out from my due date, but I’m currently creating content that will go live while I’m on leave! So just doing a bit more work up front.

There are a lot of aspects of my business that are now more passive, so I plan to still generate some sort of income even while on maternity leave (also from planning ahead in content creation). So I’m not planning to save for any kind of maternity leave supplementation at this point. But I am looking forward to taking some dedicated time off with my baby!

Baby Supplies – $1,240

Here’s the fun category! I don’t know about you but I love all the baby gadgets. Haha. Though I’ve also learned that you truly don’t need much!

Since we’re having a second baby boy, there honestly isn’t a lot that we need. We will be reusing everything in the nursery, baby clothing and other big items we already have (bassinet, stroller, car seat, swing, etc).

But there are a few baby supplies items that I’ve listed out that we plan to buy. Including the Hatch Grow baby scale, Elvie Stride pump, Rumble seat (second seat) for our Uppababy stroller, and additional miscellaneous supplies.

I took a look at my list of baby supplies we needed, and their costs, and it came to a grand total of $1,240.

Babymoon – $0

A babymoon is a vacation that a couple may go on together before the baby is born! Now we did have a little babymoon planned for March 2020 before the birth of our first son, but you know what happened March 2020… And that babymoon never happened. Haha

This time around, we won’t be doing any kind of babymoon either and that’s okay!

Maternity/Newborn Photos – $200

I always thought I’d do maternity and newborn photos the first time around, but again because of Covid… that didn’t happen. This time around, I want to do a little photo session to capture the moment with the whole family. I know $200 isn’t a lot to spend on this, but we have a friend who does some photography and gives us a discount.

Classes – $0

I think taking classes is soooo important as a first time mom. When I was pregnant with Peter we took a course on labor and delivery, breastfeeding, infant care, and baby sleep. All super helpful. But this time around I don’t feel the need to take any of these classes again because I know more of what to expect!

Maternity Clothing – $200

For my last pregnancy, I was able to borrow some maternity clothing from a friend! But this time around I need a few pieces of maternity clothing. So I’m budgeting $200 for things in that category.

Grand Total: $7,640

All in all, we’re planning to spend $7,640 on expenses related to having this second baby! With medical expenses obviously being the majority of that. It’s not a small number… And it can kind of sound overwhelming! But we’ve been planning and saving for this large expense using a sinking fund.

Sinking Fund

A sinking fund is like a savings fund in your budget that you can use to set aside money every month for a purpose that you know is coming up. So we know that by June we will spend about $7,640 on costs for baby #2.

We decided to save for this little by little over 6 months to spread out the cost. So we used a sinking fund! We took $7,640 and divided it by 6 to get $1,273.33 that we need to save each month before baby’s arrival!

We’ve then added this into our household budget to save each month for these expenses that we know are coming up. I mean… It’s still a big chunk each month, but easier than $7,640 busting our budget at once.

We’re so excited for baby boy #2 to make his arrival this summer! I can’t wait for all the newborn snuggles as we add this next family member. But we’re also relieved to be planning ahead in our budget for this moment.