A new baby is so exciting! Preparing financially for this happy addition to your family can help you budget for parental leave, baby expenses, and plan for the future by updating your financial plans, life insurance, and will.

Government Benefits

Both the federal and provincial governments provide support programs to help offset the cost of raising a family. Full details of all programs are available on the Government of Canada website.

Many parents take advantage of employment insurance programs that offer financial support to take time off work when the baby arrives! You need to contribute to Canada’s EI program and work long enough to qualify for these benefits. More eligibility information is available on the Government of Canada website.

Here’s an overview of the different benefits.

Maternity benefits

These benefits are for people away from work due to pregnancy or because they have recently given birth and may cover up to 55% of your average weekly earnings up to a maximum of $650 a week. Maternity benefits can be claimed for up to 15 weeks. Maternity benefits are only available to the person pregnant or giving birth or the primary carer for an adopted newborn.

Standard Parental Benefits

These benefits offer support for up to 40 weeks and are open to all parents. The 40 weeks can be shared, so both parents can take some time away from work to care for their new child. In fact, one parent cannot use more that 35 weeks of the standard benefit. Parental benefits cover up to 55% of your average weekly earnings up to a maximum of $650 a week.

Extended Parental Benefits

Extended benefits offer parents the option to take a longer leave, extending benefits for up to 69 weeks. This option pays up to 33% of your average weekly earnings up to a maximum of $390 a week. Similar to the standard parental benefits, these supports are open to all parents, and the 69 weeks can be shared. One parent can only take up to 61 weeks of extended benefits.

Which parental leave option is right for your family?

The Canadian government benefits for new parents are helpful, but your household income will likely decrease if you plan to rely solely on them. It’s also important to remember that these payments are still considered income and are taxable. Planning ahead will ensure you can afford to take the leave you want. Here are some other ways to prepare for parental leave:

• Many companies offer employee benefits that include parental leave top-ups. Talk to your human resources department about all options available to you.
• Save a nest egg. You don’t need to be pregnant to start planning for a baby. If you know children are in your future, start saving now.

What about all the baby stuff?

It’s a fact – babies come with stuff, and those expenses add up! Some baby things are a one-time purchase, like furniture and a stroller, but others, like diapers and food, will need to be added to your monthly budget. Here are some ways to save:

• Do you have friends or family members with kids who might be ready to get rid of some of their baby stuff? They may be looking for someone to help take it off their hands!
• Kijiji, Facebook Marketplace, and other online resale sites are FULL of baby stuff. People are often willing to sell gently used items for significantly less money.

Update your will and life insurance

A legal will and life insurance are not as much fun as cribs and baby shoes, but they are some of the most important ways you can protect your family. These two elements help ensure your children are cared for in the way you choose and provide for their wellbeing in the event of your or your partner’s death. If you already have life insurance, be sure to add your new child as a beneficiary.

We are here to help!

Planning for a new baby can be overwhelming, especially if it’s your first. We can help you build a financial plan that works for your family.

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Updated: February 2023