<iframe src="//www.googletagmanager.com/ns.html?id=GTM-WSMCRCP" height="0" width="0" style="display:none;visibility:hidden">

New Baby Financial Checklist

Apr 04, 2024 | Laura Herrera


Laura Herrera discusses the key financial items that families may want to review when welcoming a new child

New Baby Financial Checklist

My husband and I recently welcomed our third child. Like many expectant mothers I experienced an urge to “nest” before baby’s arrival. In addition to cleaning and organizing our home I found myself reviewing our finances to determine if anything needed updated to account for a new family member. Below are some of the key financial related items I reviewed.

Life Insurance

Welcoming a new baby is exciting and joyful. We find ourselves looking ahead to the future and all the wonderful moments to come. The last thing we want to think about is a world where our baby is without a parent, but unexpected things can happen and it’s best to be prepared. I bought my first life insurance policy when I was pregnant with my first child. I wanted to ensure my family’s financial stability if something were to happen to my income. Hopefully the policy will never be used, but it gives me peace of mind knowing my family is protected. During my second and third pregnancies I reviewed the existing policy to confirm it's still adequate to provide for a growing family.

Estate Planning

Similar to life insurance, it’s not easy to think about scenarios where you’re not here, but estate planning is another important aspect to protect your family’s financial well-being. When I was pregnant with my first child I met with an attorney to discuss what would happen to my assets, including the potential life insurance, if something were to happen to me. The attorney provided guidance to help me formulate a plan about who would oversee the assets for my children and how & when the assets could be used. Like my life insurance, hopefully some of these plans will never come to fruition, but the peace of mind and financial security this brings to my family is important.

College Savings

College costs are high. The current average cost for tuition, fees, and room and board at a four-year private college is $56,190 per year, according to the College Board. For a four-year-in-state public school, the corresponding cost is $24,030 annually. These numbers can be daunting, but if you start saving early, you will be in a better position to afford the college expenses.

Our family has chosen to use a 529 savings plan, and we’ve setup monthly auto deposit to keep us on track. 529 plans are state-sponsored, tax advantaged investment programs that help you save for your child’s education. A 529 account can be opened for a beneficiary as soon as the child’s SSN is available. There are many benefits. Investments in a 529 account grow tax deferred, and the withdraws are tax free if they’re used for qualifying higher education expenses. Beneficiaries can be changed to other family members as needed.

Many states offer taxpayers an incentive to use in state plans. As a Maryland resident I’ve chosen to use the Maryland 529 saving plan which is facilitated by T. Rowe Price. Contributions made into the 529 account may be eligible for a state income tax deduction.

Recent laws expanded the tax-free allowable uses for 529 accounts. You can now take federal income tax-free disbursements of up to $10,000 annually for K-12 tuition from a 529 plan. Additionally, starting January 1, 2024, beneficiaries of 529 plans may roll over up to $35,000 during their lifetime from any 529 account in their name to a Roth IRA. These rollovers are subject to the annual contribution limits, and the 529 account must have been open for more than 15 years. This new provision provides the opportunity to retain family savings and help the beneficiary save for retirement without penalties.


A Health Savings Account (HSA) is a type of personal savings and investment account you can set up to pay for qualified medical expenses, like deductibles, copayments, coinsurance, and more. HSAs offer several tax benefits. Contributions are tax-deductible, earnings are tax-free, and withdrawals are tax-free when used for qualified medical expenses. Unused balances can be carried over from year to year and continue to grow on a tax-free basis. As our family expands, I have increased my HSA contributions.

I’m a financial nerd so I enjoy reviewing these items year to year and as needed based on milestone moments. I know it might not be as exciting to most; however, I hope this list is helpful to you and your family!


Wealth planning

Let's start the conversation

If you'd like to discuss anything in more detail, please reach out here:
Contact Us