Financial Lessons Learned After a Year of Parenting

by Scott Sery on November 11, 2013

Financial Lessons ParentingOn November 4th 2012 my wife and I were blessed with our first child.  Although he came a little earlier than expected he was healthy and happy.  The first year went by quick, and there were definitely financial sacrifices made.  Here is our story:

Hospital Costs

Holden was supposed to be born at the end of December.  However, due to no fault of our own, he came 7 weeks before his due date.  Naturally there were some small complications, and the first 7 days of his life were spent in the NICU.  He developed quickly, and the majority of his time there was spent receiving intravenous antibiotics.  This is where we got our first financials shock.

The NICU costs totaled over $50,000.  Fortunately, we didn’t pay anything close to that because of insurance.  Reviewing the policy we were expecting to pay $3,000 for the boy, since that is what was listed as our out-of-pocket maximum.  Our bills, however, ended up being $6,600.  Hidden in the fine print of the policy is a “hospital stay co-pay” of $300 that does not apply toward the deductible or maximum.  Accompany that with the fact that as soon as Holden was born he was on his own policy we now had 2 co-pays and 2 out-of-pocket maximums to be met.  From day one he cost us twice what we were expecting.


We live close to the hospital so there were not many added costs of visiting the NICU every 3 hours.  Unfortunately Holden was forced onto formula after just a couple of months.  At $16 per can it is not a huge expense, but when he goes through 5 cans per month, it adds up.  Shortly after starting the formula, he began to spit up even more than usual.  A trip to the doctor revealed it could be the formula, and he was switched to a gentler mix.  A month later, the same issues, and he was switched to Nutramigen (dairy free) formula.  If you are familiar with this style, you will know that it costs $26 per can, nearly doubling our feeding costs.  With 9 more months until he would be one year old (and thus be able to switch to milk or milk substitute) we just had to buckle down and pay for the formula (which is considerably cheaper when buying in bulk off Ebay).


Small children do not really need any toys.  This was good because not only did we not want to spend the money on toys, we also did not want to clutter the house with them.  Instead the baby shower provided much of what was needed, and we found that even as he got older he did not care what it was; he just wanted to play with it.  So every now and then he would get a new toy, usually an empty water bottle, a clothes pin, or an empty formula can.  He couldn’t have been happier.  Now this can’t be kept up forever, and toys are working their way into the home since he needs them for developmental reasons.

Diapers and Clothes

Babies go through diapers.  A lot of them.  Costco seems to have the best prices, at about 18 cents per diaper.  It doesn’t sound bad until you realize a baby will go through 5 – 10 per day.  That adds up, but the only alternative is a reusable cloth diaper.  From what I have researched, cloth diapers do not save money due to not only the costs to get started, but also the utilities being used for washing (not to mention your time which you ought to have a value on).  As far as clothes are concerned, babies do not care what they wear.  So thrift stores, garage sales, and hand-me-downs will help you save a small fortune (seriously, is it worth $14 for an outfit he will wear twice and then grow out of?).


You may recall in my article about valuing your time that I have two values for mine.  One value is my minimum per hour when I am working; the other value is my minimum for giving up my free time.  After my wife went back to work from her maternity leave, I cut back to 1.5 days in the office so I would be able to stay home and we would not have to rely on daycare (grandparents helped out the days I went in to work).  I have invested thousands, if not hundreds of thousands, of dollars worth of my free time into watching him grow.  It is worth every penny.

Final thought

Kids are a pain.  They wake up crying in the night, they throw food at the wall, they bite, kick and scream.  On top of all that they cost you a bundle (many estimates are that a child born today will cost over $200,000 by the time they reach 18, although I disagree with the calculations on a lot of that).  But when they smile and run across the room to give you a hug, or when you get to see the joy in their eyes when they learn something new, everything is worthwhile.

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Scott Sery

Scott Sery is a native to Billings, Montana. Within an hour in nearly any direction he can be found fishing, hunting, backpacking, caving, and rock or ice climbing. With an extensive knowledge of the finance and insurance world, Scott loves to write personal finance articles. When not talking money, he enjoys passing on his knowledge of the back country, or how to live sustainably. You can learn more about Scott on his website Sery Content Development
  • I’m glad Holden didn’t suffer any severe complications from his premature birth. You can plan and plan but there are also some expenses that take you by surprise. They can get into all sorts of mischief, cry for hours and yet any frustration disappears when they give you hug. 🙂

  • Congrats on your new baby! I remember before when I gave birth to my daughter that was six years ago, being a hands on mom is not easy from waking up in the middle of the night, changing diapers, breastfeeding (I breastfeed my baby for 1 year and six months), helping her to learn to walk and now she is (not) a little girl anymore. Oh how time flies so fast.

  • Done by Forty

    Thanks for this breakdown, Scott. Not having children yet, we are always on the lookout for personal finance bloggers’ costs, so we can adequately plan.

  • Kids are a far way out for me but this is an interesting post nonetheless since I guess I’ll have them one day. In Canada we dont have the hospital costs but the others we would.

  • You’re lucky that your healthcare is so good.

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