5 money mistakes new makes make and how to avoid them

PIX11 Morning News

September is typically considered the “baby boom” month of the year, and as every parent knows, that little bundle of joy is not cheap.

The average middle-income family can spend nearly $14,000 on child-related expenses every single year, according to the latest “Cost of Raising a Child Report” released by the federal government. 

Consumer Finance Expert Andrea Woroch broke down some spending mistakes new parents tend to make and how to avoid them.

  • Going bigger: New parents tend to think they need to move into a bigger house or buy a bigger car. Adjust to the new lifestyle before taking on bigger expenses. There may be instances where you do need a bigger car, but consider to look at costs, such as comparing car insurance or getting a used car.
  • Overbuying baby gear and clothing: There are so many gadgets that companies want parents to buy, but they only use it for a few months. If anything, borrow things from friends or family. Make sure you spend money on necessities (strollers, car seats) and you can find deals. 
  • Ignoring the “what ifs”: No one wants to talk about death, but you need to prepare ahead if there were life-changing events. Look into term life insurance policies.
  • Underestimating child care: Consider setting up a nanny share with families who have kids the same age. Or consider a babysitter co-op.
  • Putting off college planning: The sooner you start saving, the less you have to put away every month. 

Copyright 2021 Nexstar Media Inc. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.

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