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Kim Kardashian’s Baby Has It Easy: How Much Does It Cost To Have a Baby?

Celebrities

If you have not heard that Kim Kardashian has officially given birth to baby North West with rapper boyfriend Kanye West, you have probably been hiding under a rock.

Kim Kardashian at the Seventh Annual Hollywood...
Kim Kardashian at the Seventh Annual Hollywood Life Magazine Awards. (Photo credit: Wikipedia)

Baby North was welcomed to the world several weeks early on June 15, and since then has been showered with thousands of dollars in gifts from family and celebrity friends like Beyonce and Jay-Z. Saying that baby North will never want for anything materialistic is putting it lightly, but how much does it truly cost for the average person to have a baby in today’s modern age? Here is a brief breakdown that will help you start saving before you start planning to have your very own precious baby.

The Hospital Bills and Doctor Visit Costs

While you probably will not have to pay for your prenatal and post-natal care out-of-pocket, the average insurance plan does come with out-of-pocket percentages that you must pay when you are hospitalized or when you visit the doctor. If you did not account for the medical bills when you were budgeting for baby, this is the first financial roadblock you will run into. You might not give labor in a luxurious suite like Kardashian, but it will feel like you did when you get the bill. Most parents report spending about $2000 out-of-pocket for the delivery and the hospital stay. This does not include the cost for co-pays for doctor visits. If you do not have insurance, expect to spend about $10,000 for a vaginal birth or $16,000 for a cesarean section, assuming there are no complications.

The Costs of Caring for a Newborn Baby

You will get some great gifts at your baby shower, but you still will spend money on the necessities. If you are not lucky enough to get $7000 gifts from your friends like Kanye and Kim, you should allot a budget for the big items first, and the basic daily necessities second. You will need a crib, a stroller, a car seat, and eventually a highchair, but these items are not as expensive as you might think. If you can pass up the designer brands, you can find great deals at consignment stores or retailers. Thrifty shoppers can purchase the must-haves like car seats, baby monitors, changing tables, cribs and strollers for $450 or less.

In addition to the immediate necessities, you will incur other regular expenses for diapers, clothing, wipes and childcare. Kim and Kanye may be guilty of buying $50 onesies, but you do not have to have custom Gucci clothing made for your little one. Remember that your baby will grow out of their infant clothing in a month or less. Accept hand-me-downs, and you can save quite a bit of money. Diapers, on the other hand, are a re-occurring expense that will not go away. Expect to spend at least $80 to $100 per month on diapers and wipes until your baby is potty trained. If you are not breastfeeding, allot about $100 per month for formula until your baby advances to baby food.

Kim and Kanye may have plenty of money to give Baby North whatever her heart desires, but new parents can raise a baby on a reasonable budget. It is difficult to put an actual number on how much it costs to have a baby, but being a parent is not cheap. Keep the fact in mind that love and affection is much more valuable than the material things. Consider the real costs of being a parent, and this includes lifestyle costs and monetary costs.

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Money Problems – Day 4: Making a Budget

Finance

Fiscal Year 2010 Budget Briefing (200905070001HQ)
Image by nasa hq photo via Flickr

Today, I continuing the  series, Money Problems: 30 Days to Perfect Finances.   The series will consist of 30 things you can do in one setting to perfect your finances.  It’s not a system to magically make your debt disappear.  Instead, it is a path to understanding where you are, where you want to be, and–most importantly–how to bridge the gap.

I’m not running the series in 30 consecutive days.  That’s not my schedule.  Also, I think that talking about the same thing for 30 days straight will bore both of us.   Instead, it will run roughly once a week.  To make sure you don’t miss a post, please take a moment to subscribe, either by email or rss.

This is day 4 and today, you are going to make a budget.

Now that you’ve got your list of expenses and you’ve figured out your income, it’s time to put them together and do the dreaded deed.  Your going to make a budget today.  Don’t be scared.  I’ll hold your hand.

Here are the tools you need:

  1. Your list of expenses from Day Two.
  2. Your list of income from Day Three.
  3. A spreadsheet.  I recommend the spreadsheet included in Google Docs, but Excel or the Open Office alternative, CALC, are acceptable substitutes.

Setting up the spreadsheet is dead simple.

Create a column for the label, telling you what each line item is.  Create a column to hold the monthly payment amount.   At the bottom of column 2, create a formula that totals your expenses.   If you are including a bill that isn’t due monthly, use a formula similar to the day 3 income formula to figure out what you need to set aside each month.  To figure a quarterly bill, multiply the amount by 4, then divide by 12.  To figure a weekly bill, multiply by 52 and divide by 12.

Scoot over a few columns and do the same thing for your income.

Scoot over a couple more columns and set up a total.  This is easy.  It’s just a matter of subtracting your expenses from you income.  Hopefully, this gives you a positive number.

To make this even easier, I’ve shared a blank budget spreadsheet.  No excuses.  If that simple spreadsheet doesn’t meet your needs, I’ve got a much more detailed version that includes categories.   I use the detailed version.

Making a budget may be the most intimidating financial step you take, but everything else is built on the assumption that you understand where you money came from and where it is going.  Without,it, your navigating a major maze based on a coin flip instead of a map.

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5 Ways to Help Your Friends Stay Out of Debt

Finance, Life

Playing the Shogun (2006) board game
Image via Wikipedia

There’s a saying that you are the average of your 5 closest friends.    Take a look at the people you hold dearest.  Combined, they are you.  If they are all in debt, chances are, so are you.

As a corollary,  you are a part of your friends.   If you become more financially responsible, it will rub off on the people who care about you.

Given these two rules, one way to improve yourself is to help those around you improve themselves.   If your influence convinces your friends to move closer to your ideal, it will be easier, almost effortless to move closer to it, yourself.

It sound manipulative, but if you are manipulating your friends, you are doing it wrong.   Don’t try to force or trick your friends, just be honest and sincere in your efforts to help.  Nobody wants to be in debt.  This is you being nice.

1.  Suggest cheap activities.

While it is okay to splurge occasionally, don’t be afraid to suggest less expensive activities.  If someone suggests going to a movie, mention the dollar theater.  If they want to go out for dinner, offer to host a potluck.  Trip to the casino?  Game night at your house.   There are almost always cheaper ways to have fun.  As long as you are spending time with the people you love, you’ll have a good time.  Do you really need to drop $100 to do that?

2.  Don’t flaunt your toys.

If you buy an iPod and immediately run to show it off, you are going to trigger a case of “keeping up with the Joneses”.  If your friends spend all of their time around people who are constantly buying expensive toys, buying expensive toys becomes normalized in their minds.   Debt becomes the norm.  Then extreme debt.  Don’t reinforce the destructive debt cycle by showing off the expensive trophies of excessive, unnecessary consumerism.

3.  Point out opportunities to save.

This is a fine line to walk.   If mention how much money your friend is wasting on 13 shot venti soy hazelnut vanilla cinnamon white mochas with extra white mocha and caramel every single morning, you’re going to get annoying fast. In fact, you are already annoying me, so knock it off.  On the other hand, if Caribou is having a sale on the 13 shot monstrosity, speak up.  Nobody is going to complain about getting a $15 coffee for less than $10.

4.  Give them a side hustle.

If you’ve got a friend who’s into landscaping and you’ve got a neighbor who needs a landscaper, make the connection!   If you know a web designer and a business in need of a website, get them together.   Do what you can to match the needs of the people around with each other.  They will all appreciate it, and everyone will be better off.  Be the guy who helps everyone connect with the people they need.

5.  Be encouraging.

Put another way, don’t be a dick.  Nobody likes being nagged.  Nobody likes being told they are doing everything wrong.  Be encouraging, not mean.

If you can do all of that, it’s natural that your friends will start acting the way you want yourself to act.   The less they want to waste on  a trip into debt, the less tempted you will be to do the same.

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3 Reasons You Hate Your Budget

Finance

Ice-cream dessert
Image via Wikipedia

One of the first steps in clearing up your financial mess is to set up a budget.    You need to figure out how much money you are making, how much you are spending, and what you can do to keep one of those numbers smaller than the other.   If your income is smaller than your expenses, you’ve got work to do.   If not, yay!

Even if you don’t obsessively cling to your spreadsheets and calculator, you need to spend the time to establish a budget–at least once–to know where you stand.  When you do, you’ll find out it sucks.  With good reason.

1.  It takes too long to set up. Setting up a budget can be a long, drawn-out pain in the butt.   Fortunately, it doesn’t have to be, but you won’t know that until after you make your first budget, then see some fairly drastic changes, and make a second budget.  That one will be easier.    For the first one, just concentrate on making a list of all of you regular bills and how often they are due.    Don’t be surprised when you miss some.   I missed a couple of our quarterly bills.  All told, it took a year to get our budget completely done.

2. It doesn’t lie. Once you have all of your expenses down on paper, you are done hiding.  You can’t tell yourself it’s all puppy dogs and ice cream when you are staring at the giant red pit that is the negative balance of your bad decisions.  Nobody likes the messenger who brings bad news.  When your budget shows you how big the hole is, you are going to hate it.   That’s when it’s time to confront the problem head on and get out of the hole.   Find the problems and rip ’em out.    Cancel the cable, taxidermize the cats, and start buying generic underpants.   It’s time to take an honest look at your situation.  If you can’t handle where you are, how are you going to get where you want to be?

3.  It’s not fun. When your friends go out, but you stay home because you’re broke, you will hate it.    Y’ou’re also gonna hate comparing your old cell phone to the iPhone in the hands of the d-bag contemplating bankruptcy.   Like Dave Ramsey says, “Live like no one else, so that later you can live like no one else.”   Skipping some of the fun now will turn into security later.  When you get to that point, it will have all been worth it.

Why do you hate your budget?

Let’s Talk Pets and Other Unexpected Expenses

Finance

The following is a guest post by Crystal at Budgeting in the Fun Stuff. Her blog covers living expenses, saving for your future, and the fun stuff in between.  (Ed.  Thanks, Crystal!)

I’ve been complaining on and off about the cost of my poor Pug’s allergies, so I thought I’d do a little post to let all of us vent a little about unexpected expenses. 🙂

Here’s how much Mr. Pug has cost in vet bills and medicine alone since he developed major allergies to meat proteins and dairy in February 2010:

  • February 4, 2010 – Mr. Pug licked off some hair, so we visited the crappy vet I will never go to again – $185.29
  • May 11, 2010 – Mr. Pug stopped eating and his eyes looked cloudy, first visit to new vet for dry eye – $177.78
  • May 12, 2010 – Dermatology Exam, Skin Scraping, Ear Check, and 6 medicines – $254.00
  • May 18, 2010 – Check-Up on dry eye – $53.34
  • June 2, 2010 – Check-Up on Ear Infections, Skin Infection, and medicine refills – $134.00
  • July 8, 2010 – Check-Up on Skin Infection, 2 new medicines, and 2 refills – $146.80
  • July 8, 2010 – Antibiotics – $60.60

AND we’re scheduled for another $105 check-up this coming week for his hopefully healed ear infection. So, between February 4 and this coming week, we will have paid at least $1116.81 for vet visits and medicines alone. That doesn’t even take into account the $45 bags of vegan dog food that only lasts about 6 weeks or the $500 we spent last year on 5 tooth extractions. 🙁

Thankfully we didn’t get pets until we had excess cash flow, but DANG! He’s an expensive little boy! I love him and we’d pay it again, but I wouldn’t suggest pure breeds for anybody not willing to lay out major dough for something as “simple” as allergies. We would totally let our dogs go if they needed chemotherapy or something (yes, I have my lines), but allergies…well, how do you turn down treatment that can make a pet 99% better? I’m a sucker for his big Pug eyes…I mean, look at him:

Have you had any unexpected expenses pop up? If so, what have they been and how are you dealing with it?

How have you improved your situation today?

Finance

Every day, in some small way, it’s important to do something to improve your situation.  Whether it’s paying down debt, researching inexpensive alternatives to your existing expenses, or something as simple as hugging your spouse or playing games with your kids.

Educate

I was once told that every day, you either get smarter, or you get dumber.  Don’t do the latter.   Never pass up an opportunity to educate yourself.    Make the day good for you.

  • Read a book.  There are hundreds of personal finance books available.  Dave Ramsey’s Total Money Makeover is a great place to start.
  • Read a blog.  Once again, lack of choice is not a problem here.  There are thousands of choices.  My favorites are in my sidebar, to the left.
  • Find a mentor.  Failing that, get a PF-Buddy. Find someone you can call when you need the moral support to make an appropriate or difficult financial decision.
  • Take a class.  Whether it’s a personal finance class, or some other way of improving yourself, do it.  Many cities offer affordable community education classes. Ad Hoc college courses are another option.

Elucidate

It’s incredibly important to understand your situation.  If you don’t know where you are, how can you control where you’re going?

  • Examine your finances.   I heartily recommend Quicken to track your finances, but Mint is a great place to see where your money has gone.
  • Know your debt.  It’s important to know your debt. Own it.  Know your fees and your rates.  Know every cent you owe.  Get a spreadsheet or a notebook and write it all down. Keep it updated.   Mint is great for this.  I update my debt-sheet monthly.
  • Know your spending.   This is another plug for Mint.   There’s no better way to see where your money has gone in the past.  I use Quicken for the present and future, Mint for the past and snapshots.
  • Find your waste. Do you have the cheapest plans that meet your needs for television, internet, phone service?  Do you have AAA and roadside assistance through your insurance company?
  • Talk to your spouse.  Discuss your finances. Make sure everyone is on the same page and there are no surprises or hidden bills.  Plan together.
  • Eliminate problems early.  If you see a problem, eliminate it before it gets out of control.  The earlier you identify a problem, the easier it is to eliminate.
  • Family meeting.  Get the family together so everyone can participate, even the children.   Young eyes sometimes have a clarity that a lifetime of habits has clouded. If your kids understand the concept of money, they are old enough to participate and even help.   Brainstorming means that no idea is a bad idea.  It may not be implemented, but everything is worth hearing.

Eradicate

What’s left? Eliminate baggage.  Kill your bills.  If you’re paying for something you don’t want or need, get rid of it!

  • Unnecessary items.  Do you have an extra cell phone or an insured motorcycle in the garage?  Time to cancel.
  • Unused items. Do you really use the movie package in your cable bill?  Are you saving money with Netflix, or would Redbox be a better option?
  • Forgotten bills.  Did you sign up for an identity protection scheme or an appliance repair plan for an appliance that no longer exists?  Cancel!
  • Fees.  What fees are you paying?  Do you have an annual fee for your credit card or minimum balance fees at your bank?  Find new institutions.  Loyalty to your bank may be costing you money.

Unused or unnecessary bills are nothing but unhappiness generators. They don’t provide value so trim the waste and get rid of what you don’t need.