1. Call Your Accountant.
A new child in the family qualifies you for an additional tax deduction. In 2013, you qualify for a tax break of $3,900!
Also, if you work or are headed back to work and employ someone to take care of your child, you’ll probably qualify for a child care credit. And review your withholding. You may now be withholding too much from your paycheck. Call that CPA.
2. Sign up for a college savings plan.
What’s called a 529 college savings plan is a great option. You can get started as soon as you receive your baby’s social security number. Save a little every month, and soon you’ll have a great start on those college bills that, believe it or not, come around sooner than you think!
3. Call an attorney about who will be your child’s guardian.
You’ll want to pick a guardian for your baby in case something happens to you or other important people in your family. It’s not much fun to think about the possibility of death when you have a new child, but it’s important to step up to the responsibility of making sure someone will be able to legally take care of your child if you die or are accidentally incapacitated.
When choosing guardians, think about who among your closest relationships has the right strengths for your child. Then think about who would be a good caregiver versus who might be a good money manager (they don’t have to be the same person). Once you’ve decided on who those folks are, sit down and talk with them about whether they would be willing to fill those roles. If so, you’ll have peace of mind and be able to have those choices written down and legally authorized.
4. Create an estate plan.
An estate plan is a combination of legal documents in which you will pick people to make health care and financial decisions for you. You’ll designate Powers of Attorney, create (or revise) your Will, perhaps start a Trust, and you’ll coordinate beneficiaries throughout your family structure.
As an example, it will be important to update your retirement plans, life insurance plans, and other accounts so that these accounts are transferred at death in a manner consistent with your Will. Minor children cannot inherit outright, so this is an important step.
5. Save money for date night.
And take those vacations. The demands of being a new parent in the modern world can leave little time for rest, contemplation, and downtime. Make sure you make time for yourself, and for just being alone again with your partner. This will ensure a strong you, a strong partnership, and better parenting all around.