Baby's Bottom Line
Baby, Oh Baby!

There are few things that will change your life more than having a baby. You can always go back to college or get a divorce or move to another city if some of your other life-defining decisions don't pan out. But it's a little more difficult to decide that you've changed your mind about that 8-pound bundle of joy. You're in for the long haul, and we're here to help get you prepared.

What can you really expect now that your family is getting bigger? Less sleep, more photos and a different way of looking at your bank account. Let's take a look at some of the things that are going to change thanks to your baby's bottom line:

SHORT TERM

From the day that your family finds out that the little pumpkin is on the way (pregnancy test: $9) to the day that you help him blow out the candle on his first birthday cake (candles and cake: $15), expect to run up bills of about $18,000. Whew! If our parents had thought about the expenses we would incur, we probably wouldn't exist. So don't freak out too much right now. Families make do every day. You can, too.

A large portion of this dollar figure will come in the form of prenatal health care and the delivery of the baby. Hopefully you've been a good Fool and had a solid health care insurance plan in place before you decided to think about Junior. Depending on where you live, the amount you can expect to incur for the first nine months of health care for Mommy and Junior-to-be will be around $6,800 to $10,600 for the medical care and a caesarean section.

So, we've got your insurance company picking up the tab on a big chunk of the first year's cost. But what about everything else? What could possibly cost another $11,000? Well, childcare for that first year can top the $4,500 mark if Mom goes back to work. Then don't forget gizmos like a crib, a child seat for the car, and a stroller. The cost of clothing and shoes will probably hit $600 while a new rocker will put you back about $150. And (are you sitting down for this?) by the time that Pumpkin is toilet trained you will have changed between 7,000 and 10,000 diapers ($0.16 per diaper X 10,000 = $1,600). Then, of course, there are things like baby food, photos, birth announcements, toys and that birthday cake. For some ideas on how to make the first two years of life more affordable, check out our 10 Foolish Money Savers.

LONG TERM

Clothing and Feeding -- As they grow bigger, so do their appetites for things like food and sneakers. Expect the costs of clothing and feeding your child to grow steadily until the seventh birthday. From seven to ten years of age the costs tend to level off somewhat. Costs start to skyrocket again, though, when they start middle school. One consolation is this: believe it or not, it gets cheaper overall if you have more than two children. There are savings in "bulk kids" -- hand-me-downs, sharing toys, and buying large pizzas, for instance. In fact, parents with three children save on average 22% per child more than three single children in different families.

Health Care -- Nothing, absolutely nothing, is as heart wrenching as a sick child. Now is a great time to take a look at your health insurance. When it was just you and your young, healthy spouse, you probably didn't worry about it very much. Start worrying about it now. What does it cover? Are "well-baby" appointments encouraged? Can you choose your own pediatrician or do you have an HMO that will send you to a clinic? What will happen if something is wrong with your baby? Be prepared now for what you can expect them to cover and what you and your family may have to pay out of pocket.

Insurance -- Let's face it, when you were all by yourself you probably didn't think about insurance very much. You were young and fearless and convinced that bad things would never happen to you. And even if they did, they happened only to you and no one else. Well, you're all grown up now and your spouse and your little munchkin would lead a very different life if you're weren't able to help out with things. Even if you were only hurt, your life would be irreparably changed. If you died, you wouldn't be around to contribute your income, but if you were incapacitated, not only would your income be gone, but your spouse would still need to take care of you! Check out our new Foolish Insurance area for tips on getting the best insurance policy for you and your family.

Education -- The obvious thought here is that you're going to need to pay for college for your new little bundle of joy. But what about other education-related expenses? If Jimmy needs extra help in math you can plan on spending about $12 an hour for a semi-private tutor. Or if Jennifer turns out to be a budding Marie Curie, remember that you're going to be writing checks for things like chemistry sets, summer computer camps, and science fair displays.

Child Care -- Possibly more than any one expense, your child care bill will be the most important, but also the most elastic. Where you live, what kind of facility you choose, how often you will need to use it, and how old little Chuckie is when he demands to be called Charles and is ready to stay by himself all affect how much you will pay for child care. Studies show that a good estimate is between $3,000 and $4,500 per child per year. Check out the National Child Care Information Center for more info on how to find the best care at the best price.

Big, Bigger, Biggest -- While it may seem obvious, you may not fully comprehend the difference in your living situation now versus one year from now or even five years from now. You're going to need a bigger house, a bigger car (maybe a second and eventually, a third car), a bigger yard, possibly another TV, another computer and another phone line. This is another human being who is going to want all of the cool and nifty things that you have... and probably lots more.

Ballerina Slippers and Baseball Bats -- Wouldn't it be neat if you could just feed them and buy them a few pairs of jeans every year? Oh, if life were only so simple. Get used to Barbie doll collections, "American Girl" beauty pageants, soccer practice, baton lessons, football pads and the accompanying trips to the emergency room. Studies show that parents spend about $600 per child per year on "extracurricular activities."

And finally, just in case -- If we haven't scared you enough, we're gonna scare you some more. A small, helpless human being is going to be depending on you for a long time for everything from the food that she eats to the roof over her head. What would happen to her if you and your spouse weren't around to take care of her? If you've never made a will, make one now. Decide who would take care of your children in the terrible event that you couldn't do it. Think about how that person will pay for taking over your responsibility. And choose someone that you trust implicitly. They will be taking care of the most precious thing that you ever cared for in your life.

--Trudy Hoyden
(TMF Hoyden)