Becoming a Parent

Adding to your family is a joyful experience, but the financial stress can be overwhelming. You can never be too prepared — get started and learn how to navigate and plan for financial milestones.

Servicemember bolding laughing baby

It is estimated that the average cost of raising a child from birth to age 18 is approximately $300,000! Luckily, you don’t have to pay it all upfront. Here is a guide to help as you expand your family.

First Steps

Welcome Home!

Congratulations on becoming a parent! As your family grows, make sure your finances keep pace. Here are a few administrative tasks you’ll want to take care of when you first welcome a child into your military family.

  1. Enroll your child in the Defense Enrollment Eligibility Reporting System (DEERS).
    • You will need an official, notarized copy of the birth or adoption certificate.
    • Enrollment needs to be completed in person at the DEERS office.
  2. Apply for a Social Security card for your child. This can be completed online.
  3. Inform your finance office of your new addition to your family. Basic Allowance for Housing (BAH) is larger for Service members with dependents.

If you just adopted a child, you may qualify for adoption reimbursement.

Financial Preparation

Create a Budget

With a new child in the mix, your budget should reflect your family’s changing needs. Plan for bigger, one-time purchases, like a crib or car seat, as well as ongoing purchases, like diapers, clothing, and child care. Consider how your incoming cash flow will change if one or both parents are taking unpaid maternity or paternity leave or will become a stay-at-home parent.

You’ll also want to be aware of larger purchases that may come along with your new addition. This could include a bigger home or larger family vehicle as your family grows.

Build an Emergency Fund

Unexpected expenses will always come up – especially when you add children to the mix. Even putting aside $10 or $20 a month is a good start, and you’ll be glad you have it when the need arises.

Get a Handle on Health Insurance

Protect your baby’s health and well-being by setting up health insurance for your child. To be covered by TRICARE, your child must be enrolled in the Defense Enrollment Eligibility Reporting System (DEERS).

If you choose TRICARE for your child:

  • Enrollment requires an official, notarized copy of your child’s birth certificate and must be done in person.
  • From the day your child is born, you have 90 days (stateside) or 120 days (overseas) to enroll them in TRICARE. If you miss this window, you will have to wait until the next open season or life event.
  • Coverage for reserve members requires continuous, regular payments to stay enrolled. Drill pay can be irregular, so make sure you’re up to date on your premiums to avoid a lapse in coverage.
  • Don’t forget to include dental coverage.

Once you’re enrolled in a plan, TRICARE covers well-child care for your newborn from birth through 5 years of age. This includes:

  • Circumcision before leaving the hospital
  • Routine newborn care
  • Height, weight and head circumference
  • Immunizations
  • Developmental and behavioral assessment
  • Comprehensive health promotion and disease prevention exams
  • Vision and hearing screenings
Note: You will make your baby’s first well-child appointment before you leave the hospital.

Breast Pumps and Supplies

Did you know that TRICARE covers breast pumps and breast pump supplies at no cost for new mothers? This benefit is also offered to mothers who adopt an infant and plan to breastfeed.

Banked Donor Breast Milk

Banked donor milk is an option if an infant is critically ill, when the mother’s breast milk isn’t available, or there isn’t enough milk. TRICARE covers banked donor breast milk for certain conditions and situations.

Live Your Best Life with Life Insurance

Life insurance can be a difficult topic to discuss, especially when you’re just starting a family, but getting ahead can help you feel comfortable that they will be taken care of. You’ll want to review the amount of coverage and update beneficiaries as appropriate.

Update Legal Documents

As your family grows, it is important to review your legal documents such as your will. This is critical when you have minor children so you can name guardians.

Plan for the Future

Another thing to consider is funds for college – it’s never too early to start saving! Recent studies find the current average annual cost of a four-year in-state public university (including tuition, housing, books and supplies) to be around $25,000 a year. If you factor in inflation, future costs will be even higher.

While you may want to be prepared to pay for college, it might require a combination of savings, scholarships, financial aid, the post-9/11 GI Bill, and student loans to get the job done.

Other Financial Considerations

Monitor your credit score. As a new parent, you may open a new line of credit to help with some expenses. It’s important to use credit wisely. Review our Understanding Credit guide to learn best practices.

Your income taxes may change. Everyone’s situation is different, so it is best to meet with a tax professional for guidance. For additional help, visit Military OneSource to access free MilTax services.


Know Your Resources

Your installation’s New Parent Support Program can help you understand your eligibility for different kinds of support, including financial and developmental assistance.

Military OneSource can connect you to free financial counseling with a military money expert and free workshops to build your money skills. Call (800)342-9647 to connect or search for your installation’s Personal Financial Manager.

Service relief societies offer support when military families need it most. These nonprofit organizations support military families with both necessities and emergency needs.