Guys – I’m sorta teary eyed today. Why? Because LB is now more than nine months old and I honestly don’t even know where the last 3/4 of a year went. It feels like it was just yesterday that I was sitting in this very spot, with a giant pregnant belly, wondering who this little person would be. Safe to say, she’s hilarious and fun and so full of life – I now have trouble imagining my world without her.
All these feelings have also made me realize that we did ourselves a huge favour planning for my maternity leave. So today’s post is a continuation of our Family & Finance series sponsored by Atlantic Credit Unions and I’ll explain just what we did to be able to afford for me to be home for an entire year.
The absolute first thing we did was research. Here are the important things we discovered:
- In Canada, maternity leave is the first 15 weeks following the birth of a baby
- In Canada, parental leave follows maternity leave and is up to 35 weeks and can be shared between the parents
- According to the Government of Canada, the average baby costs about $500 per month in the first year of life
- While on maternity or parental leave, your Employment Insurance will ‘pay you’ either the total allowable amount for that year – which in 2017 in Nova Scotia is about $490/week or 55% of your past salaried income if it is less than $490/week.
What does that all mean? It means that when all is said and done, even if you’re maxing out EI, you will be taking home no more than approximately $24,000 while on maternity leave. If you assume the $500/month in baby-related costs holds true, that’s $6000 in spending right there – so you’re down to about $18,000 in mat leave income.
That’s where we started. We did that exact calculation and then used the term of my pregnancy to double down and save. Once I was through the first trimester, we felt okay to start actually saving money in a maternity/baby fund. If you’ve been a long time reader, you’ll know that the first trimester was not a happy time for us – it didn’t feel right to be socking money into a baby fund when we weren’t sure there’d be a baby. Thankfully, this time, LB had solid plans to show up. 🙂
At about the 12-week mark, we created a high-interest savings account and we stopped saving into other accounts and put away every single last cent we could muster into that mat leave account. Our goal was to have two years of ‘baby expenses’ put away before the baby was born.
The other thing we considered was when to start my maternity leave. Technically it can start at the due date of the baby. Now, LB was right on time – but I started leave a week early so that I could sync up my last pay cheque from work with my first payment from EI – essentially meaning I was never going to miss a pay period. This was a LIFE SAVER. Especially because in those first couple of weeks, you can barely brush your hair, let alone check your bank balance to make sure there’s money for the mortgage.
Other things we did to financially manage a maternity leave?
We saved all our loyalty points! In fact, we are still saving those puppies! Remember how I mentioned in our last post (about how we paid down a six-figure debt in less than five years) that we now use credit for almost everything? That’s why! We are ‘points collecting’ fiends LOL. The plan was to save them up for a couple of years and then use them to either off-set baby costs (diapers, food, clothing) or use them to fund Christmas 2018. We have about $1000 in points saved up already – so my best guess is that they will be spent a little on Christmas and a little on everyday baby related things.
Controversy alert! Buuuuut, not revealing the gender of our baby was also a really great way to save. Let me explain. We’ve all been to baby showers where the gender of the baby is known and the parents receive SO many cute outfits and hair clips or teeny shoes or blue and pink and all that, right? Nothing wrong with that. However, I think an unintended consequence of us not finding out our baby’s gender was that people couldn’t buy us those cutesie things and instead they bought us really useful, large-scale, expensive group gifts – like a stroller and car seat, a baby carrier, a baby monitor, thermometer, gender neutral clothes for DAYS, bath products, feeding products – all the things you have to buy anyway and that cost hundreds if not thousands of dollars.
Naturally, once LB was born (with a full head of hair!) people sent small token gifts like frilly socks and bows – but nothing over the top. Essentially, what I’m saying is, we didn’t have to shell out for anything expensive ahead of the birth of the baby and that was a mega cost-savings to us.
The last thing we did was eliminate any recurring payments before the baby was born. Normally, we pay our insurance bill monthly, but I used some of the mat leave savings to pay for a year in-full. The only reason I did this was to take one thing off my New Mamma Brain list. It didn’t save us money. In fact, I think one could argue it cost us a bit in interest accrual – but it’s been nice to not have to worry about paying that bill while my schedule has been all sorts of crazy.
That’s it. It feels really basic when I type it out and then read it back to myself – but I feel like a lot of our approach to managing life and money is quite basic. Putting it into practice can be a challenge, but in this case, our commitment to preparing for mat leave paid off. Now… let’s see how I deal with my mat leave ending!!! That’s a post for another teary-eyed day.