Perhaps you might not have planned to have a baby right about now. Despite the unanticipated timing, this is a moment to celebrate.
Here are a few pointers to help you get financially prepared to ensure that you have every reason to celebrate the birth of your baby.
- Make sure you belong to a medical scheme
While you can join a medical scheme the day you find out you are pregnant, the medical scheme is not going to pay for any costs associated with your current pregnancy. That being said, if you can afford it, joining a medical scheme with pregnancy benefits may be advisable if you intend to have more children, as future pregnancies will be covered. Membership of a medical scheme will also be an advantage once your baby is born. If your baby needs medical care, and you are not a member of a medical scheme, then you will have to pay cash or visit a public hospital.
On the other hand, if you are on a medical scheme before falling pregnant, then around 70% of your financial expenses in relation to pregnancy will be covered depending on what type of cover you have. If you’re on a medical scheme and not sure what your benefits are, now’s a good time to check.
- Make sure you have some money stashed away
Medical costs aside, there are a few other baby supplies such as nappies, clothes and formula, that you’ll need. Start putting aside amounts for these types of expenses. If you don’t have it saved up, you’ll have to take out a loan to cover these costs.
There’s a basic rule that you should have at least six times your take home salary (after tax) saved in case of unexpected life events. This is easier said than done. So how do you start building up an emergency fund? By being strict about how much you spend, you would be surprised how easily you save R5,000, then R10,000 and so on.
- What are the rules around maternity leave and the benefits at the company you work at?
A third factor to consider when you’re expecting a baby is how you will make up for the income you’d usually bring home when not on maternity leave. The first thing to do is to check your employment contract to find out the following:
- Are you entitled to 4 months of maternity leave?
- Is your company obliged to pay you while you are on maternity leave?
Quick fact: women in South Africa have the right to four months of maternity leave. But there is no legal obligation for your employer to give you paid maternity leave.
If you have been contributing to the Unemployment Insurance Fund (UIF), you are eligible for a maternity benefit of up to a maximum amount of 60% of your salary, with the benefits paid for a maximum of 121 days.
If you aren’t sure about your rights in relation to maternity leave, find out from your employer what they are and make sure you know what to expect.
We’d love to hear from you if you have any other financial tips to share around planning for your pregnancy.
Until next time.
The Wise About Life Team