Baby #1 Here We Come!!

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20151011 - baby SallLiz and I heard all the horror stories from 30-somethings that had trying to get pregnant recently – “If you want a family, you might want to start trying soon. It took us 2 years to get pregnant.” Others told us it would probably take a solid 6 months. Well, they were all dead wrong. It it took approximately 2 minutes…. Baby #1 is on the way!! Liz and I are very excited, but have so much to do and think about before the baby arrives in May! Here’s the running list so far.

1) Finish Painting the House

We’ve been working our tails off for the past 6-7 weekends on our house painting project. We’re upgrading our home from a dingy tan to a summery blonde beauty (light yellow). So far, we’ve nearly completed 3 sides of the house and are about to tackle the 4th. As with most projects, we’ve discovered that this is taking WAYYY LONGER than we thought it would, but the results so far are pretty awesome. Our house is going to look amazing once it’s all said and done. More updates to come on this!

20151011 - house transformation2) Transforming the “Hotel Room” into the Baby’s Room

We currently use our living room for relaxing, socializing, and occasionally playing the piano – the TV does not reside here. Since we only had two of us and three bedrooms, we set up one of the rooms as the “hotel room”. In this room is a guest bed, dresser, night stand, a couch, and a TV – everything you’d see in a typical hotel room.

Well, it now makes a little more sense to transform this “hotel room” into the baby’s room. Liz still has a few clothes that will need to migrate over to the master bedroom, much of the furniture will need to come out (including the TV), and we’ll need to find a crib, a changing table, a rocking chair, and probably a futon (for those upcoming sleepless nights with the baby).

3) Transforming the Basement into Livable Space

As of right now, the basement is basically a place to throw stuff we’re not using. Liz has a few boxes down there, I have some tools scattered about from the window installation project, and there is a weight bench that probably has a few layers of dust on it by now (I work out at the local gym instead). In the next few months, we’ll be working to move the couch and TV (from the hotel room) down there, and maybe even make a baby play area as well. This work will make our house about 250 square feet bigger without all that much effort (and probably zero dollars!).

20151011 - rental home4) Buy A Rental Property

When Liz and I got married, we figured that we’d work for a few more years, bank some money, buy a couple of rental properties, and then have a baby. Well, since it took us a microsecond to get pregnant, this sequence of events has shifted a little bit. We really don’t have enough money to buy two rental properties at the moment, but I do believe that we can at least buy one (which will hopefully supplement the unknown baby expense that’s coming our way).

On Monday, Liz and I are going to take a look at the following properties:

  • A 4 bedroom, 2 bath house that’s listed for just $85,000 – potential rent income of $950 a month
  • A 3 bedroom, 1 bath foreclosure for $99,975 – potential rent income of $950 a month
  • A 3 bedroom, 1 bath house on a large lot for $99,900 – potential rent income of $1,050 a month

Hopefully we can find a diamond in the rough, fix it up this winter, and start renting it out before the baby arrives!

5) Make Out a Will

Since Liz and I have worked hard to become debt free and to save up our cash, we’ve developed a surprising amount of assets. And, now that we have a baby on the way, that’s all the more reason to think about some ‘what-if’s’ and make out a will. Thankfully, this doesn’t have to cost us thousands of dollars either. We can just head to our local library (or their website) and print off the forms ourselves. For it to be official, we’d just need to find a notary and we’ll be all set! This will definitely be a top priority to get done before that baby comes.

insurance6) Set Up All Insurances

When I think of being a father, I realize that I have some new-found responsibilities. If anything should happen to me, I want to make sure Liz and baby are taken care of without her having to work 80 hours a week to make ends meet. This means we’ll both need some life insurance. Luckily, my work provides a life insurance policy that covers 1.75x my current salary. As for Liz though, we should really get some life insurance because without her around, we’d have additional costs of daycare, nanny services, and probably a bunch of counseling sessions so I don’t go crazy!

In addition to life insurance, also have to figure out our medical insurance. I will likely put the whole family under my plan through work, but which should I chose? The standard plan or the consumer driven (high deductible) plan? As you may have guessed, I did the math and discovered that the consumer driven plan is actually the better deal (mainly because of the HSA money we receive each year). So, I’ll have to put this on the calendar to get done in May.

And….Go!

Well, there’s plenty to do – that’s for sure! Sounds like Liz and I will have ourselves a busy winter. Keep us both in your prayers – we’ll provide updates on the baby and the house projects as we get them!

Is there anything I missed? What else should go on this list? Stock up on diapers maybe? πŸ˜‰

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Money

Derek

AUTHOR Derek

My name is Derek, and I have my Bachelors Degree in Finance from Grand Valley State University. After graduation, I was not able to find a job that fully utilized my degree, but I still had a passion for Finance! So, I decided to focus my passion in the stock market. I studied Cash Flows, Balance Sheets, and Income Statements, put some money into the market and saw a good return on my investment. As satisfying as this was, I still felt that something was missing. I have a passion for Finance, but I also have a passion for people. If you have a willingness to learn, I will continue to teach.

26 Comments

  1. Congratulations! I see one red flag in this post—treating estate planning lightly. Especially given the assets you’ve already built up, I highly recommend spending the relatively small amount of money to get a thorough estate plan. when you have dependents, you need to give it the proper attention. Your (our) employer offers a legal plan in the annual benefits package that I have used twice over the years, with a very small personal cost. My motivator was the intestate condition of my grandparents when they passed. They had a “quickie” will that was proven to be invalid, resulting in a lengthy probate process in which everyone that matters lost to some degree. Kids will change your value judgments in every way. Don’t skimp on estate planning.

    • Good point Brian. I tend to do things as cheaply as possible sometimes, but a will is obviously of HUGE importance. I will make sure to do it up right and according to the legal specs.

  2. HI Derek!

    Congratulations to you & Liz on the blessing of your forthcoming little one! What an exciting (and sometimes nerve-wracking) time in your lives.

    Just a couple thoughts to add to your “tick list”…

    1) Start a college fund for your little one right away. We just entered “Grandparenthood” and gave each of our two new grandchildren money to start a “college fund” with. We left it to our kids to decide how they will choose to invest the money. By the time your little one is ready for college, the fund will have grown into an amount that will be a big help to keep them from having to borrow less in the way of student loans (or better yet, avoid loans altogether).

    2) Consider establishing a trust along with your will. It’s important to make provisions for the future of your little one in the rare case that something happens to both of you at the same time. To whom would you and Liz entrust the care of your children if that were to ever happen? That is something important to start thinking about soon.

    Enjoy every aspect of preparing for parenthood!

    Blessings, Kim

    • Hi Kim! Thanks for the tips. A college fund is definitely a good idea and will have to be something we look into. I know of a few people that intended to, but then time just slipped on by.

      As for the trust, yes that’s another thing we might have to check out. So many things! Thanks again for reaching out.

  3. Congratulations Derek AND Liz. Pray everything goes well. That time will go fast especially if you are going to redo your house and a rental house. I wish you well.

    Favorite Aunt

    • Right! Hopefully we’ll wrap up the painting on our house in the next couple of weeks. If we buy a rental property, there will definitely be more work to do! Good thing I like to stay busy!

  4. Congratulations on the exciting baby news!!! Your list reminds me that my wife and I need to make out a will, 4 kids later. I hope you get all your home projects accomplished and find a nice rental property to fix up and rent out, before “Baby LAMF” arrives. πŸ˜‰

    • Yes, a will is important! Oh the projects! You make it look easy with 4 kiddos, so it should be a cinch now, right? πŸ™‚

  5. Congratulations! I think it’s wise to finish all the home and/or rental projects while you can now as you won’t have much time after the baby comes when you’ll feel like doing that stuff. It’s funny how little you actually need. We got all of our baby furniture from my sister-in-law and most of the other stuff was given to us at a baby shower. I would also say go out together as much as possible because it will be a while before you’ll be able to or feel comfortable doing that without the baby. Have fun!
    Kim@Eyesonthedollar recently posted..What Would You Do With $500?

    • Thanks for the comment, Kim! I’m glad you told me that you don’t really need much with a kid, because I was starting to freak out a little bit, wondering where I was going to put all that baby stuff! It’ll be a whole new experience for sure, but we’re ready for it!

  6. Congrats! We had heard the same horror stories… and started worrying, so we threw caution to the wind… and like you, pregnant in like two minutes πŸ™‚ Best decision I’ve ever made in my life. Congrats on having ‘making a will’ on your to-do list… I have so many friends who have toddlers that still haven’t gotten around to it. And don’t freak out – you don’t need much at all for a kid… you may want a lot to try and make life easier, but I tell my friends you only need three things 1)diapers, 2)milk (free!) and 3) love (free)!!!!
    Mrs SSC recently posted..September 2015 Budget Update

    • Haha. Well I’m glad you consider it the best decision you’ve ever made! I trust it’ll be ours too. πŸ™‚

  7. Congrats to you and Liz! It’s such an exciting time, and as you mentioned, so much to do. I’d recommend that in addition to life and medical insurance, you consider disability (income protection) insurance. If something happened (illness or injury) and you were unable to earn an active income, you want your family to be protected. If your passive income meets your needs at some point you can drop the disability coverage. Anyway, get the “what ifs” out of the way and enjoy this special time.
    Gary @ Super Saving Tips recently posted..Goal Planning or Do You Believe in M.A.G.I.C.?

    • Thanks Gary! My work does provide disability insurance at 60% of my current income. Since our expenses are minimal, we could still live comfortably on this. But, it might be worth it to buy a little extra and turn that 60% into 70%. On the other hand, if we buy a rental, that should provide us that additional 10%+. Good stuff to think about though. Thanks Gary!

  8. Congrats! Does that make this a honeymoon baby?! What a fun surprise! If you need saving tips I wrote my article on how we only spent $2k on Nora’s first year. I anticipate we’ll spend less on Etta since I already have cloth diapers. I recommend them if Liz plans to work part time or stay home; I’m not sure I’d do it if I was working full time since you have to be mindful not to let laundry get backed up.
    Jessica @ Budget for Health recently posted..Budget Review: July – September 2015

    • I definitely need to check that out – the less we spend the better. Whoa, I didn’t know anyone used cloth diapers anymore! I think I might have to learn more about those too. Thanks for the tips!

      • They’ve come a long way. I thought the same thing and pictured safety pins and a piece of cloth. They’re way easier to use and maintain now. You’re welcome!

  9. Congratulations! So happy for the both of you.

    You might want more life insurance as well. 1.75x salary isn’t enough for burial expenses, a college fund, paying off any future rental properties if you aren’t paying in cash, and for a transition fund of 1-2 years of expenses.

    • Thanks Jenna! The rental property will be in cash, but I didn’t think about a college fund. Maybe I’ll need to increase my life insurance for a few years, but if we buy a few other rental properties with cash, then I figure I can probably cancel it. Good thoughts!

  10. awww, congratulations! So happy for you. πŸ™‚

    • Thanks Bobbi! We’re still very excited! Due date May 11th!

  11. How did I miss this post? Congratulations!!!!!!

    We have a 2 and 4 year old. Here are my top 3 frugality tips we have learned over the past 4 years.

    1- Formula is expensive. If breastfeeding is an option, consider it first for all the health reasons but also be aware of the cost of formula.

    2- Diapers are expensive! If you can deal with cloth diapers, I hear it’s well worth it. ….. We couldn’t do it…

    3- Kids are content with very little toys. Don’t waste your money on anything over 10$. Toys can be very expensive. My kids play with blocks and legos 90% of the time and we get most of them used. Also for their birthdays, we say no gifts, or if the parents must get something we say to get a book. We still get them a present for their birthday, but they don’t need a gazilian toys. All this does is commercialize them.

    Bonus tip- Look for clothes on buy and sell Facebook mom groups and at second hand stores. They grow so fast, the new brand name clothes is not worth it.

    Good luck with your new chapter in life!

    • Thanks for the tips MSR! We plan on breastfeeding, so that’s a check in the box. I was actually just talking about our cloth diaper idea with the guys from work yesterday. They said it’s super gross and they couldn’t handle it. Buuuut, I think we’re going to try it anyway. It might not work for us, but that’s okay, at least we can say we tried. And, I totally agree with you about the toys. Kids don’t need much, so why overload your house with a bazillion toys?? We’ll see how this works out when the kid comes… πŸ˜‰

    • One benefit of breastfeeding rarely mentioned is convenience. Breast feeding is easier than washing bottles, mixing and storing and heating formula, and all that jazz.

      As for life insurance, if you need more, many employer plans offer you multiples of your salary for a cost. This can be the least expensive way to buy life insurance. So you might look into that, Derek.

      • Hi Dorothy. Thanks for the words of wisdom! Liz definitely plans on breastfeeding, so hopefully we’ll discover that that’s “easy”. My work provides 1.75x my salary automatically, so that’s pretty awesome. On top of that, I ended up buying an additional $100k through work for a very small amount each paycheck. Now we just have to nail down our will!


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