09 November 2017
5 min read

Bringing up a child is probably the most daunting thing you’ll ever do and one of the costliest too. This is especially true if you’re preparing for your first child. From bottles and booties to car capsules and cribs, then childcare and schooling down the track, you’ll need to be financially prepared for your new bundle of joy.

All too often parents are financially unprepared for a baby, so we’ve done some research into some of the most common traps and how to avoid them. Along with costs, it’s also important to make sure your purchases are safe for your baby – and they don’t have too high a price tag for the planet either. The good news is that taking good care of your baby doesn’t have to cost the Earth.

Here are ten ways to ensure you’re financially ready for your newest family member – and some tips to help you make better purchases for your little one.


You may have been living easily on one or two incomes without a child, but additional expenses can mean potential changes to your budget. Of course, the last thing you’ll want to do when you’re sleep deprived and trying to make ends meet is to start thinking about your budget.

So, start now – by getting a clear picture of how much you earn, how much you spend and how much you can save. That way you can decide how much leave you can take, what you can spend on child care and baby purchases, and whether you can afford to reduce your work schedule in future.

Next, use an online budget tool (there’s a really good one at moneysmart.gov.au) to set up a monthly budget and track your expenses. Think about where you can cut costs too – say, by borrowing a cot, getting a pram second hand, or swapping baby clothes with friends.


For most parents, quality child care for your newborn comes with a cost. You want to think about whether you or your partner (or both of you) are going to take a lot of time off work, and how that’s going to impact your income.

Find out what your employer offers in terms of paid parental leave. It’s the law that your employer needs to give you some leave; most employers offer about 12 weeks. It’s also worth getting the paperwork with Centrelink sorted sooner rather than later, as you may be entitled to up to an additional 18 weeks paid leave on top of what your employer offers. If you plan to take unpaid leave, check your budget to see how long you can last on a smaller income. Then start saving for those salary-free weeks or months ahead. It’s also a good idea to make sure you have enough ‘rainy day’ money, in case you won’t be at work as long as you’d expected – little ones can arrive earlier than expected!


It might seem like ages away now, but your great aunt Beryl who keeps bothering you to look into childcare is probably right. The cost of care varies by region and type of care – a day-care centre versus a nanny or in-home help. Assess what you can spend, investigate what’s available in your area and consider creative ways to save. For example, sharing an experienced nanny with one or two other families, or asking someone who is already retired in your family to babysit, can greatly reduce the expense – and as a bonus, it gives your baby some instant buddies.


It may seem odd, especially if you’re still young, but now is the time to start thinking about life insurance. If something were to happen to you or your partner, life insurance can prevent financial ruin and provide for your child’s immediate and future needs. You can work out how much life insurance your family needs based on your current income and housing costs. All members of Australian Ethical Super automatically receive life insurance through our provider, Metlife – although you can opt out of this if you want. For more information, visit metlife.com.au.


Most people think of wills solely for their assets. But even more importantly, your will designates who has guardianship of your child if you and your partner were to pass away. While it’s an easy thing to put off, making a will is essential: if you don’t choose someone to care for your child, the court will – and it may not reflect your wishes.

Creating a will doesn’t need to be complicated. You can even use an inexpensive online service or store-bought documents (available at most newsagencies) to name a guardian.


There’s a host of baby products on the market that claim to be ‘natural’, ‘sustainable’, or ‘green’. Many of these claims are simply clever marketing and ‘greenwash’. To avoid being hoodwinked by greenwashing, be on the lookout for vague terms such as ‘eco-friendly’ on the labels. Instead, be guided by recognised, Australian government-approved certification logo standards and certifications, such as:

– The Australian Certified Organic standard: A reliable logo for organic food or fabrics.
– The Ecospecifier Global Green tag: Covers anything from cleaning and personal products to furniture.


Disposable nappies are convenient but a huge contributor to landfill. There are some disposables that claim to be biodegradable, so they’ll break down in landfill – a better choice environmentally, but they can be costly. With their snap fasteners, waterproof covers and removable liners, modern cloth nappies are easier to use than the old terry towelling ones. While they’re not as polluting, cloth nappies use more water (especially a consideration if you live in a drought-prone area) not to mention energy costs if you’re using hot water and a tumble dryer. Then there’s the environmental costs of growing cotton, which also takes up a lot of water. Even so, according to CHOICE magazine, cloth nappies still come out ahead if you dry them on the line.


As far as fabric is concerned, synthetics are best avoided – they’re flammable, can irritate the skin and can’t be recycled. Organic cotton is a better bet, but still requires a lot of water. The organisation Trusted Clothes recommends tencel (a man-made fibre made from wood from sustainable pulp farms), hemp, organic cotton or bamboo as better fabric choices.


Baby’s toys will inevitably end up in their mouths and there’s growing concern about toxins such as BPA and phthalates in plastic toys, so you might be safer choosing wooden toys instead. Wood also lasts longer and can be handed down to other children or sold when your child grows out of the toy or loses interest. Don’t forget the toy library – a great way for your child to get their hands on new toys without cost or creating more pollution.


Babies and toddlers grow fast so they don’t get a lot of wear out of their clothes. So why not arrange to share hand-me-downs with friends, or through a local ‘buy swap and sell’ page on Facebook? You can also sell any unwanted items for a bit of extra dosh too – great for those unwanted baby shower presents, or the leftover clothing after an unexpected gender surprise!


Did you know that we’re working on a Financial Inclusion Action Plan?

Part of our aim over the next year and beyond is to take extra care to help prevent our members from falling into financial hardship. For more information, keep an eye on our blog and our Facebook page.