Baby Budget

[Caoineag]

Thanks Monkeymama, I was definitely confused. I was assuming AGI but taxable is actually AGI - deductions.

[jIM_Ohio]

Okay, I am pretty sure I am missing something here. 66k doesn't cover everything you have listed. Your groceries are exceptionally cheap given the rest of your numbers and I don't see any additional savings or personal spend money. Maybe you guys don't spend a lot of money but I assume you will have some clothing expenses for baby, probably for the mom as well and various other household expenses that aren't accounted for.

I guess my questions is what am I missing and what are you asking?

40k in intemized deductions between mortgage and small business helps.

Expenses are kept low- most vacations are funded from a second job I have which pays cash and is not budgeted for.

As far as kids activities, the way I see it two things will happen short term- the 300 for diapers and 700 for my truck will disappear, creating $1000/month for kids activities and paying down the 2nd mortgage. Within 5 years $700/month pays that off. Then the $400/month for that gets added in and we can think about a college fund or two and a new car fund as well.

We also don't have raises factored in, the way I see it raises will kick in where the deductions start dropping off (I cannot forsee 40k of deductions sustaining for a long time).

[mom-from-missouri]

Is the homeowners thing monthly?? or yearly??

Have you checked into a diaper service???
I always used cloth diapers, but for awhile I used a diaper service because they ony charged $40 a month. It was worth it to pay the $40 a month for unlimited diapers for 3 little girls.

[jIM_Ohio]

Homeowners is once per year, due in January.
disposable diapers will be used- we can afford it and it is simpler for wife and I.

[TBH]

Am I missing something?

What about daycare? It sounds like both of you work.

[tripods68]

Jim,

Have you thought about consolidating your debt (two cars, 2nd mortgage) into one loan through refi? Is this cost effective to you?

[zetta]

Definitely need a clothing allowance for your wife. The maternity clothes can only be worn for anohter month or two (if she can even stand to look at them anymore!), and it's likely to be at least nine months before she can wear most of her pre-pregnancy clothes. (I'm still 10 pounds over after almost 3 years!)

I spent $50-$100/month on clothes and other misc baby items (babyproofing gates, etc.) the first year.

[disneysteve]

$1,020/month on car payments!!

Have you reviewed your life insurance? Now that there are 2 children to provide for, you may both need to take another look at how much coverage you need.

Do you intend to start any college savings?

Do you know what, if any, medical bills you will have to pay for all the pregnancy and delivery stuff?

[sounderella]

Once your wife is done with the maternity clothes, you can sell them on ebay.....there's a big market (no pun intended) for them there. That's what I did. Plus that can add back to her clothing allowance for new clothes.

I also second the life insurance thought. That's a biggie.

[jIM_Ohio]

Daycare-

I am working 2nd shift once babies come home (1-10 pm)
Wife will do client visits in morning and work from home in afternoons.

Debt- wife's car is a lease. She puts around 25k miles on car per year. That part of budget is considered fixed until she changes jobs.
2nd mortgage is ~50k@30yr fixed and truck will be paid off in 2 years. I'd prefer to keep terms of the loans. We have a bigger priority on increasing the EF than than paying off the debt.

We each have 300k term policies. We also each have 25k of permanent insurance as well.

I am considering dropping whole life once I get EF to 6-12 months expenses. 300k is enough to fund day care expenses and similar. Maybe we need more (500k), I will think about it.

Wife is already wearing pre maternity clothes. The clothes we have were borrowed. There is a children's place outlet with a 2.99 rack where we can spend $300 and get enough clothes to fill the closet.

[stressedmama]

$300 is to much for diapers. I currently have 2 kids in (diposable) diapers right now and spend right at $100 per month for both. I buy diapers at Aldi and they work great (but they only sell size 3, 4, 5).

I also use Parents Choice (Walmart store brand) formula....much cheaper. They sell organic, regular, soy, lactose, etc. Between (store brand) formula and baby food I spend about $110/month for one kid.

I agree with the others comments about needing a clothing budget and doctor/medicine/copay budget.

[disneysteve]

We each have 300k term policies. We also each have 25k of permanent insurance as well.

I don't recall how much each of you earns. I know the total is 66K but how is that split? If you were to die, would 325K be enough to support your wife and kids at least until they are adults? That's about 18K/year for 18 years (plus interest).

It may or may not be enough. Just run the numbers and make sure.

[checkthebudget]

Here is a suggestion: If cable is an option in your area, kill the land line and the satellite. Use cable and Skype voip. Skype will cost you $3 a month for unlimited local and long distance. I get cable and high-speed internet for about $60 a month. So losing the landline and direct tv will save you close to $100 a month ($1200 a year!)

[LuxLiving]

Diapers / Formula:

Many store tags will tell you how much an item costs per ounce, per pound or by some other unit of measure. Don't forget to comparison-shop by unit price and save.

For example, a pack of 40 diapers costing $13, runs 33 cents per diaper, whereas a box of 144 diapers costing $35, runs only 24 cents per diaper.

That small difference of 9 cents may not seem like much, but changing a diaper six to eight times each day, equals a savings of $16 to $22 per month. Double that for twins and you've got a nice little amount to tuck away in the 529!

[noppenbd]

Diapers / Formula:

Many store tags will tell you how much an item costs per ounce, per pound or by some other unit of measure. Don't forget to comparison-shop by unit price and save.

For example, a pack of 40 diapers costing $13, runs 33 cents per diaper, whereas a box of 144 diapers costing $35, runs only 24 cents per diaper.

That small difference of 9 cents may not seem like much, but changing a diaper six to eight times each day, equals a savings of $16 to $22 per month. Double that for twins and you've got a nice little amount to tuck away in the 529!

In this vein I wanted to reiterate Amazon's diapers. A 216-pack of size 1 Pampers Swaddlers is $46 with free shipping, coming out to 21 cents a diaper. How much are Walmart's diapers, and are they as good as Pampers?