As a first-time parent, there’s a lot on your plate. You’re responsible for raising a tiny human into a smart, kind, and successful member of society. Mistakes, even when it comes to money matters, are inevitable.
Still, thoughtful planning can help you meet your financial goals and give your kids the support they need.
And they will need all kinds of support: Consider that the cost of raising a child born in 2015 to a middle-income couple until the age of 17 is nearly $285,000, with projected inflation costs, factored in, data from a federal survey shows. And that doesn’t include college. (Not surprisingly, the higher a family’s income, the more is spent on a child.)
To make sure you’re starting off on the right foot, here are common money mistakes first-time parents make and how you can try to avoid them.
1. Overspending on Baby Gear
As a first-time parent, you likely have quite a bit of work to do before the baby arrives. You may need to create and furnish a nursery for your child, and stock up on diapers, bottles, clothes, toys, and so much more.
As you’re setting up your new life with a baby, it can feel like buying everything brand-new is the only option, but that can be costly. You might consider taking advantage of used or gifted items.
You can buy a lot of items secondhand at a lower cost through online marketplaces or at brick-and-mortar used goods and consignment stores.
And if you have friends, family, or neighbors that already have children, they may be looking to unload some of the gear their children no longer use. Things like cribs, playpens, toys, books, and clothes are all great for passing down.
2. Living Without a Safety Net
As a new parent, you’re about to incur all sorts of costs you may have never thought of.
Now that you have a child or one is due, having an emergency fund is even more important. You’re now responsible for all of their needs, and there may be unplanned costs that pop up along the way.
Saving for an emergency is a process, and it’s okay to start small—even just $25 a week will add up over time. Some people opt to store their emergency fund in a savings or checking account, or a digital cash management account.
3. Avoiding a Budget
Before you had children, maybe you cooked the majority of your meals at home, did all of the houses cleaning weekly, prepped meals, and meticulously shopped for groceries to stay on budget.
The first few months with a newborn can be a blur, complete with sleep-deprived nights and exhaustion. You may not have as much time to cook and clean or keep up with the other activities you were handling before the birth of your child.
You could hire a housekeeper, get take-out meals, enroll in a subscription meal-delivery service, or have your groceries delivered every week—but all of those conveniences come at an added cost, obviously.
A new monthly budget can help prepare you for the extra expenses.
As your child grows, there can be more and more new costs. Maybe they need braces or want to participate in a sport, art classes, dance lessons, or music lessons. Thinking about these costs now may make planning for them easier.
4. Putting Off Saving for Retirement
Another financial mistake some new parents make is failing to save for retirement.
Learning to pay yourself first isn’t easy for a lot of parents to do, but you could consider prioritizing retirement while helping your child as much as possible and educating the child on smart practices for student loan borrowing.
For retirement savings, one way to start is by enrolling in your company’s 401(k) plan if one is offered. Some employers will match your contribution, up to a certain percentage, and you’ll be able to have your contribution taken directly from your paycheck. If your employer doesn’t offer a 401(k), you could open an IRA instead.
It’s never too early to start saving for retirement.
5. Not Saving for College
As mentioned, you may not want to focus solely on saving for your children’s tuition and let retirement planning fall by the wayside. But that doesn’t necessarily mean you can’t try to save for both.
While a standard savings account may seem like the easy choice, there are other options available that are designed to help you or your grandparents save for a child’s education.
One is a 529 college savings plan. There are two types: education savings plans and prepaid tuition plans.
With an education savings plan, an investment account is used to save for the child’s future qualified higher education expenses, like tuition, fees, room and board, computers, and textbooks. Earnings used for qualified expenses are not subject to federal income tax or, in many cases, state income tax.
With a prepaid tuition plan, an account holder purchases units or credits at participating colleges and universities for future tuition and fees at current prices for the beneficiary. Most of the plans have residency requirements for the saver and/or beneficiary.
A Coverdell education savings account may also be worth looking into. In general, the beneficiary can receive tax-free distributions to pay for qualified education expenses.
Contributions to a Coverdell account are limited to $2,000 per year. The IRS sets no specific limits for 529s.
6. Missing Out on Tax Breaks
When you have a child, you may be eligible for certain tax benefits. It might be worth reading up on the Child and Dependent Care Credit, the Child Tax Credit, and, for lower-income parents, the Earned Income Tax Credit.
There’s also an adoption tax credit, which offers tax incentives to cover the cost incurred if you adopted a child.
Consult a tax professional to see if you qualify.
7. Not Teaching Your Kids About Money
If kids aren’t taught the basics of financial literacy at a young age, they may struggle to balance a checkbook, make a budget, or save money when they’re older. Helping your children learn what it means to manage money by teaching them to save and spend their earnings can help set them up for financial success in the future.
You may want to introduce your children to money at a young age—kids love to play store, and by exchanging goods for money, they’re already beginning to understand the basic principles of commerce.
As they get older, you may want to try giving them an allowance in exchange for chores or homework completion.
You could even have them make a budget with their earnings, and encourage them to spend, save, and donate.
New parents are often too overwhelmed to think a whole lot about managing money, but trying to avoid common financial mistakes could help the whole family, at first and much later.
If you’re a first-time parent and aren’t sure how to plan your finances, a money-tracking app could help. SoFi Relay tracks all of your money, all in one place—at no cost—and provides credit score updates.
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This story originally appeared on SoFi.