A change in eating habits. A nausea feeling in the morning. A visit to the the gynecologist. A sudden realization that you might be going to be a parent soon. A large inflow of “experiences” from colleagues or parents come flooding in regarding the cost of raising a child. Amidst the congratulatory notes, it seems like a huge burden just got placed on your tired shoulders.
“How am I going to afford all of these?”
In journey with money, we hope to be able to help people retire early and also avoid financial pitfalls through stock investment and financial planning (singapore). We recognised that having a baby or a child might delay the process to be financially free. However, with preparation and planning, we can still reach the goal that we want. Firstly, we need to understand the costs involved and prepare for it.
1) Benefits that you can get in Singapore
The Singapore government has been encouraging my young couples to start their own families and been giving many incentives. You can find a whole list of it over at marriage and parenthood schemes and also baby bonus page. For example, you can get a cash benefit of $8000 just by registering your child to join the scheme as early as 7 to 10 working days after the baby is born (information accurate as of 26/05/2017).
Understanding these support will greatly help you in planning for work and also finances.
2) Cost of Delivery
There is a great difference if a family choose to deliver the baby in a government hospital or private hospital. While, there are certainly pros and cons in either, a detailed comparison have been done by sassymama.
In summary, cost of delivery in a public hospital is averages around $4000 while a private hospital averages around $8000. This is excluding any other medical costs (ie. complication costs)
3) Financial planning for baby
In the complexity of insurance products, there are 4 main plans that your baby will need. You will need a combination of a hospital, accident, life and also a saving plan for a baby.
In the tender years of growing up, the chances of a baby falling sick is high. Without insurance (or subsidies), a week visit to a private hospital might cost up to $10,000. A comprehensive hospital plan will take care of this worry. Accident coverage will take care of certain illness like dengue or HFMD when the child do not need to go stay in a hospital.
A life plan would get a child protected for life at a young age. Premiums then would be cheaper and also creates a foundation in a child’s financial portfolio.
Lastly, a saving plan would set the stage ready for your baby to have adequate funds to study in a university of his/her choice during that time.
That being said the most important part of planning is still protecting the parents of the baby. Who will be the one taking care of the baby if the parents is sick.
In Journey with money, we want to empower individuals to retire early and avoid financial pitfalls such as this. Such a financial pitfall will delay retirement by at least a decade if not forever. If you already done financial planning (singapore) or have financial planner, that’s fantastic. You should be proud that you have taken the first step. However, there are many still unaware of this. We will like to offer our readers (even if you have a plan already or not) a free review by our in-house Financial Planner. He will cater a uniquely designed portfolio for your specific needs and your journey with money.
Feel free to leave comments below or contact him at email@example.com
As we practise value investing in Singapore, don’t forget to have proper protection against critical illnesses!