Congratulations!! Now let’s get down to business.

There is often so much excitement, joy, and preparation for the baby’s first week home that we can forget about the big picture.  While there is no shame in hyper-focusing on sleep patterns, pumping and creating a beautiful birth announcement, there are some other newborn considerations to address.

  • Health Insurance
    • Take some time to review your health insurance options for baby. Baby may be added to your employer plan, have their own plan, or qualify for a state program. Regardless, do your homework and understand the process/deadlines for enrolling baby. POWWOW works with local health insurance agents to get you started.
  • Estate Planning
    • In the event a child’s caregiver unexpectedly passes, who takes over? What if you expected the godparents to step in but your parents petition for custody? Is this a decision you want to make or the state? Creating a will addresses custody issues and I am happy to coordinate and attend an estate planning meeting with you.
    • Who is in charge of the assets that pay for your baby’s care? You likely want a trustee in control of the assets until your infant is a more appropriate age. Maybe you assumed the caregiver would also control the assets, but I often recommend these roles be separated to avoid conflict
  • Life Insurance
    • Term life insurance is a relatively inexpensive method of protecting families while they’re in the asset accumulating stage. In the event one or both caregivers pass prematurely, how will baby’s continued care and advanced education be funded? Maybe you’re fortunate to have a healthy nest egg, but many working families are living off salaried income that can only be replicated through insurance. POWWOW can calculate how much insurance is needed and works with Low Load Insurance to provide affordable quotes. POWWOW receives no commission for providing clients this information, and there is no obligation to purchase.
  • Education Funding
    • There is no better time to start saving than now when you want to help pay for college education. What’s the worst that can happen, saving too much? 529 Plans are a great tool for college savings and can be opened once your baby has a social security number. They come in 2 varieties, the U.Fund and U.Plan.
      • The U.Fund allows you to accumulate tax-free investment earnings as long as the assets are spent on qualified college expenses. Any unused amount can easily be rolled over for a sibling or relative to use. If you have a genius baby that receives a scholarship, you are also able to redeem that amount from the 529 plan penalty free, although you will owe taxes as if it was invested in a regular account. Fair enough.
      • The U.Plan allows you to pre-pay college tuition at today’s rates. This is a huge benefit as private tuition has been rising at about 6%/year. Being able to lock in your tuition basically gives you an investment return equal to inflation, which in this case may be better than what you could get investing in the market. Although there is a great variety, the plan is limited to select schools in MA. See the list here: Work with POWWOW to see how much you should be saving toward your child’s education and which 529 plan is best for your family.