Money questions you need to ask before starting a family
Posted by
Matt Hale
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It’s an exciting time when you and your partner start thinking about having a family. It’s a highly emotional period in your life so it can be easy to get caught up in at all and forget to think about the practical stuff.
The reality is that if you’re expecting a baby, your finances are about become stretched. Not only will you have an extra mouth to feed (not to mention hospital bills, baby clothes, pram, cot etc.), more than likely one of you is going to have to take some time off work.
With this in mind, it’s crucial that you ask the right questions so that you are as financially prepared as possible for what’s to come.
Here are the key questions that we advise our clients to ask before starting a family:
Questions for your employer
Do you offer paid parental leave?
If you’re uncomfortable about asking this then check your employment contract. If your employer doesn’t offer paid parental leave, it may be worth looking around for a new job that does (generally you have to be in a role for 12 months before you are eligible for paid maternity leave). Otherwise, the government offers paid parental leave at a rate of $657 per week before tax for a maximum of 18 weeks.
How long can you hold my job for?
Ideally, you want to have a job to come back to so it’s important to check with your employer how long they’re willing to allow you to take off (this varies significantly from employer to employer).
When I’m ready to come back, will you consider flexible work arrangements?
Juggling a baby and work can be really difficult, so it’s important to explore the possibility of flexible work arrangements with your employer. Now that it is so easy to work remotely, employers are becoming more and more accommodating in this area.
Questions for your partner
Can we live comfortably off one income?
This may seem obvious but many couples fail to consider this question prior to falling pregnant. If one income isn’t going to cut it then it could be wise to start saving a nest egg to tide you over for while.
How long are we happy to live off one income for?
Even if you can make one income work between you, it still means that there will be less funds coming in to the family bank account each month. Make sure you talk to your partner about how long you are both willing to live on one income.
Who will contribute to my super fund while I’m not working?
If you’re staying at home for an extended period to look after the children, your super fund will suffer. Consider talking to your partner about using a portion of their income to make regular deposits in to your super account.
Questions for your family
Can you assist with childcare once I go back to work?
It’s a good idea to ask this question early on because it can be a deciding factor in whether you go back to work or not. Childcare fees can be really expensive, sometimes costing almost as much as what one of you will earn in one day. If family help isn’t possible, then it’s a good idea to start saving early for childcare costs.