{"id":15229,"date":"2023-03-29T08:02:41","date_gmt":"2023-03-29T14:02:41","guid":{"rendered":"https:\/\/www.discover.com\/online-banking\/banking-topics\/?p=15229"},"modified":"2024-05-22T08:06:37","modified_gmt":"2024-05-22T14:06:37","slug":"budgeting-for-maternity-leave","status":"publish","type":"post","link":"https:\/\/www.discover.com\/online-banking\/banking-topics\/budgeting-for-maternity-leave\/","title":{"rendered":"What you need to know about budgeting for maternity leave"},"content":{"rendered":"\n

Prepping for a new baby\u2019s arrival might kick your nesting instinct into high gear, as you make sure everything is just right before the big day. One thing to add to your new-baby to-do list is figuring out how to budget for maternity leave <\/strong>if you\u2019ll be taking time away from work.<\/p>\n\n\n\n

Lauren Mochizuki, a nurse and budgeting expert at a personal finance blog, took time off from work for the births of both her children. Because she had only partial paid leave each time, she says a budget was critical in making sure money wasn\u2019t a source of stress.<\/p>\n\n\n\n

\u201cThe purpose of budgeting for maternity leave is to have enough money saved to replace your income for your desired leave time,\u201d Mochizuki says.<\/p>\n\n\n\n

But the question \u201cHow do I budget for maternity leave?\u201d is a big one. One thing\u2019s for sure\u2014the answer will be different for everyone, since not everyone\u2019s leave or financial situation is the same. What matters most is taking action early to get a grip on your finances while there\u2019s still time to plan.<\/p>\n\n\n\n

Before you get caught up in the new-baby glow, here\u2019s what you need to do to plan and save for maternity leave:<\/p>\n\n\n\n

1. Estimate how long you\u2019ll need your maternity budget to last<\/h2>\n\n\n\n

To plan and save for maternity leave, you need to know how long you plan to be away from work without pay.<\/p>\n\n\n\n

The Family and Medical Leave Act (FMLA) allows eligible employees up to 12 weeks of job-protected, unpaid leave from work per year for certain family and medical reasons, including for the birth of a child. Some employers may also offer a period of paid leave for new parents.<\/p>\n\n\n

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As you\u2019re considering how to budget for maternity leave, you\u2019ll need to estimate how long you\u2019ll need your maternity budget to last. Mochizuki says to consider how much unpaid leave you plan to take based on your personal needs and budget. For example, you could find you\u2019re not able to take the full period offered by FMLA after reviewing your expenses (more on that below) and how much you have in savings.<\/p>\n\n\n\n

Even if your employer does offer paid maternity leave, you may decide to extend your time at home by supplementing your paid leave with unpaid time off, Mochizuki says.<\/p>\n\n\n\n

Keep in mind that despite budgeting for maternity leave, your health and the health of your baby may also influence how much unpaid time off you take and how long your maternity leave budget needs to stretch.<\/p>\n\n\n\n

As you\u2019re trying to plan and save for maternity leave, make sure your spouse or partner is also considering what benefits may be available to them through their employer. Together you should know what benefits are available for maternity or paternity leave, either paid or unpaid, and how to apply for them as you jointly navigate the budgeting for maternity leave process. You can then decide how to coordinate the amount of time each of you should take and when that leave should begin. <\/p>\n\n\n<\/div>\n\n\n

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Contact your HR department to learn about your company’s maternity leave policy, how to apply for leave, and whether there are any conditions you need to meet to qualify for leave. Ask if you’re able to leverage sick days, vacation days, or short-term disability for paid maternity leave.<\/p>\n <\/blockquote>\n<\/div>\n\n\n

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2. Babyproof your budget<\/h2>\n\n\n\n

When budgeting for maternity leave, make sure you review your current monthly budget to assess how budgeting for a baby<\/a> fits in.<\/p>\n\n\n\n

In Mochizuki\u2019s case, she and her husband added a category to save for maternity leave within their existing budget for household expenses (e.g., mortgage, utilities, groceries).<\/p>\n\n\n\n

\u201cWe treated it as another emergency fund, meaning we had a goal of how much we wanted to save and we kept working and saving until we reached that goal,\u201d Mochizuki says.<\/p>\n\n\n

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As you plan and save for maternity leave, consider the following questions:<\/p>\n\n\n\n