Anticipating the birth of a first child is a time of immense joy and celebration. Most prospective parents are probably also nervously wondering how their life will change going forward, especially financially. No matter how prepared new parents may feel, there are bound to be unexpected expenses in the first year of a child’s life—and the years that follow. Let’s look at some of the most common unexpected costs so parents can plan ahead to the best of their ability.

Childbirth and healthcare

While it’s a great idea to budget ahead of time for the costs associated with labor and delivery, it’s not uncommon for new expenses to crop up if a birth doesn’t go as planned. “A longer hospital stay, additional procedures, or needing to transfer hospitals or see a specialist are all possibilities,” said Cole Reiser, financial advisor with Northwestern Mutual in Dallas. “It’s important to be aware of what health insurance will and won’t cover and have an emergency fund just in case.”

Having a child also comes with a special enrollment period where parents can add the baby to their health insurance. While premiums don’t usually change for each additional child, upgrading a health insurance plan for the first child usually comes with higher premiums.

“Additionally, parents should consider the costs of taking their baby to check-up appointments, emergency health visits, medications, and even purchases like breast pumps and thermometers,” Reiser said.  “It all adds up!”


There are almost always additional unexpected costs associated with childcare, especially if there are unanticipated changes to a parent’s leave from work or their work schedule. While there are options for childcare—daycare, a nanny, a childcare share with another family, for example—it’s difficult to know ahead of time if any of these options are going to work for a family or the full cost. Reach out to family, friends, and colleagues with children to see if they have cost-effective ideas or resources they can share.

Life insurance

Having a baby means planning ahead for their safety and security and the well-being of the whole family. “If parents don’t already have life insurance, such as term or whole life insurance, it’s a good idea to consider coverage – or more coverage for parents who are already covered,” Resier said. “In addition to the death benefit, whole life insurance comes with other benefits, including a flexible cash value component.”

Diapers and other everyday supplies

Formula, wipes, clothes, baby food, and other daily supplies all cost a pretty penny. Some of those costs will be budgeted for, but it’s never clear exactly how many diapers and clothing changes a baby needs until a parent is in the thick of it. In addition, cute accessories and educational toys are always hard to pass up, and high-priced equipment like strollers and car seats may not work as planned for a family and need to be replaced.

Household costs

For many parents, having a baby means moving to a larger apartment or house, potentially purchasing a first home, or adding costs to their existing household bills. Doing more laundry than ever before, washing baby bottles, giving baths, and keeping the temperature comfortable for everyone can all impact monthly electric, gas, and water bills. Because parents have less free time on their hands, they may also often see a jump in how much they spend on the convenience of food delivery.

Northwestern Mutual is the marketing name for The Northwestern Mutual Life Insurance Company (NM) and its subsidiaries in Milwaukee, WI.

Source: Northwestern Mutual