How to adapt your budget to the arrival of a baby | Kaleido Blog Article
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How to adjust your budget for the birth of a baby

Kaleido's Blog

Written by: Kaleido

September 26, 2023

Are you about to become new parents? Your joy is boundless, but so, most likely, is your stress. By taking the time to plan ahead for the impact baby’s arrival will have on your income and expenses, you can lessen the financial uncertainty. Here are a few tips to help you adjust your budget and take some weight off your shoulders. This will allow you to enjoy every moment of the happiness that comes with welcoming a new member of the family!

What costs can you expect in the first year of your baby’s life?

According to some studies, the cost of the first year with a newborn is about $10,000. So it’s a good idea for new parents to start thinking about budgeting sooner rather than later.

The best way to get started is to take stock of the expenses you’ll have in the first few months after your baby arrives, when your income will probably be lower because of parental leave. This will help you identify the tricks that will make it easier to set up your new family budget.

Ask your friends and family which items are essential for welcoming baby, and forget about the rest. This will save you time and money, so you can stock up on the hours of sleep you’ll soon be missing!

Make a list of everything you’ll need, taking into account what you already own and what friends and family might give or lend you. Think about the furnishings for baby’s room, clothing, diapers (disposable or washable) and other items that new parents need, such as a stroller, bottles, blankets, a baby carrier and a car seat.

All these expenses will have a significant impact on your financial situation in the first few months of your new life as a parent. So look for gently used items at flea markets, thrift stores or online marketplaces – you might find some great bargains. For things you have to buy new, take the time to compare prices between stores.

For help in preparing an effective family budget, download our handy budget template.

Government programs and services for new parents

The federal and provincial governments have various programs to help parents. It doesn’t matter whether your family income is low, you have a little or a lot of money saved up, or you’re comfortable financially – you have access to government assistance.

Planning parental leave

Parents of a newborn or adopted child are entitled to up to 65 weeks of unpaid parental leave. This parental leave is in addition to 18 weeks of maternity leave and 5 weeks of paternity leave.  

The federal government also offers an Employment Insurance maternity benefit and parental benefit for unemployed parents and for self-employed workers registered with Employment Insurance:

  • The maternity benefit is available to biological and surrogate mothers for 15 weeks.
  • The parental benefit can take two forms, and in both cases, the parents can share the benefit period:  
    1. The standard benefit can be paid for up to 35 weeks. The benefits amount to 55% of the claimant’s average weekly insurable earnings, up to the maximum allowable amount.

    2. The extended benefit can be paid for up to 61 weeks. The benefits amount to 33% of the claimant’s average weekly insurable earnings, up to the maximum allowable amount.

Canada Child Benefit (CCB)

The federal government also provides the Canada Child Benefit (CCB). This is a tax-free monthly amount paid to families to help them support their children under 18.

Childcare deductions

If you qualify for them, childcare expense deductions could be very beneficial for your budget.

To be eligible for these deductions, a child must meet the following conditions:

  • Be yours or your spouse’s;
  • Reside with the person paying the childcare expenses during the taxation year;
  • Be under 16 years of age.

If your child is older and employed, his or her income must not be greater than $11,081 for Revenu Québec, and $14,398 for the Canada Revenue Agency (CRA). For more information about childcare expense deductions and credits, check out our full article on the subject.

How much could your RESP earn?

Takes about 5 min.

Saving with an RESP

The arrival of a baby is the perfect opportunity to open a Registered Education Savings Plan (RESP) for his or her for post-secondary education. The earlier you start, the better the pay-off will be when your child is older!

With an RESP, you can save for your child’s post-secondary education1 and reach your savings goals more easily, since your contributions will be supplemented by generous government grants.2 The Quebec and federal governments will boost your investment by depositing funds directly into your RESP. You can get up to $12,800 per child3 through the various government programs. Your savings and grants will grow over time – tax-free. And the longer you contribute to your RESP, the more you’ll benefit from the compounding effect.


Whether it’s your family budget or your education savings, most experts agree on one thing: Start early! Your family will benefit, and so will your financial well-being.

Interested in incorporating an RESP into your new family budget? Our representatives are available to answer all your questions.
Legal Notes

1. See our prospectus at for information about eligible post-secondary programs.

2. Subject to obtaining the necessary authorizations to proceed with the grant applications. Some conditions apply. Check out our prospectus at

3. Canada Education Savings Grant (CESG) of 20% to 40% and Québec Education Savings Incentive (QESI) of 10% to 20%, Based on adjusted family net income. The maximum annual CESG payment is $600, and the maximum annual QESI payment is $300. The maximum lifetime amount per beneficiary is $7,200 for the CESG and $3,600 for the QESI. Canada Learning Bond (CLB) of up to $2,000 per beneficiary for a child born after December 31, 2003, whose family is financially eligible. Some conditions apply. Check out our prospectus at