"Whenever your life changes in a major way, so does your financial situation," says Angela Iermieri, a financial planner at Desjardins. You need to know how much money will be coming in (i.e., maternity/parental benefits) and take new expenses into account.
Adjusting your budget for the new baby is essential, but so is planning for longer-term goals, like buying a home, and your child's future needs.
"Now is a good time to look at your ability to save and build an emergency fund, which you'll need if you want to maintain your standard of living should life take an unexpected turn," says Iermieri.
And while you're at it, set up an RESP (registered education savings plan) for your child. Not only is it a great investment in their future, it's also an excellent investment vehicle, since the government matches your contribution by 30% in Quebec (and 20% in Ontario). A flexible plan will allow you to contribute based on your ability and to increase your contribution as your budget allows.
"Having a baby should remind parents of the importance of creating a will and power of attorney," says Nathalie Tremblay, a life and health insurance specialist at Desjardins. "They should also review their individual insurance coverages."
If you have group insurance through your employer, you should check to see if those coverages meet your new needs.
"You want to minimize the financial impact of death. With adequate life insurance, your loved ones would be able to pay your final expenses, like funeral expenses and taxes, and maintain their standard of living," says Tremblay. That might mean that they wouldn't have to move, your kids could continue their extracurricular activities and they could go to college or university, just as they would if you were still there. And with disability insurance, your income would be protected if you weren't able to work because of an illness or accident.
Get professional advice
There are lots of tools available to protect your family's quality of life. That's why evaluating your individual insurance coverages is part of an overall needs analysis.
For an accurate and thorough analysis of your financial needs, get in touch with your financial security advisor.