Money-Saving Tips for New Parents: From Hospital Bills to College Funds

Parenting in America today feels like walking a financial tightrope. Everywhere you turn, you’re reminded how “unaffordable” it is to have kids, and that’s before you see the real numbers. But what no one tells you is that traditional budgeting tips—like cutting back on your coffee runs or couponing for groceries—don’t come close to covering the reality of raising a child.

Between medical bills and essential baby gear, the first few years of parenthood will test even the savviest planner – much less what new parents need for the first month. You’re not alone if you’re feeling overwhelmed, but with the right strategies, it’s possible to provide for your family without losing your mind (or your savings).

Health Insurance is the Non-Negotiable Safety Net

Your first baby expenses occur months before the baby is born. Or even months before they are conceived if you need medical intervention to get pregnant. Health insurance is non-negotiable. It can save you tens of thousands of dollars and ensure you and your baby get needed care.

Here’s a breakdown of the average costs:

• Prenatal Visits: Expect 10 to 15 appointments, each costing between $90 and $500 without insurance.

• Routine Tests: Add ultrasounds, bloodwork, and other necessary screenings, and the costs quickly climb.

• Labor and Delivery: Hospital fees alone range from $15,000 to $30,000 on average. My delivery bill was $25,689, but I didn’t pay a cent thanks to TennCare, Tennessee’s Medicaid program, which covered all prenatal care, labor, and delivery expenses.

• Pediatric Care: Babies need frequent checkups, vaccines, and sometimes additional medical care. Skipping these isn’t an option unless you’re willing to gamble with your child’s health. For us, TennCare has also covered every pediatrician visit, vaccine, and even an overnight hospital stay that exceeded my delivery bill.

Medicaid programs vary by state, but many offer expanded eligibility for pregnant women and children, even if your income would normally disqualify you. If you’re not eligible for Medicaid, don’t panic. Many employers offer group health insurance plans that cover maternity care. If you don’t have access to employer-sponsored coverage, the Healthcare Marketplace is a solid option.

Baby Essentials: Spending Smart Where It Matters

It’s tempting to think you need everything from the baby store, but trust me, most of it is just clutter. Here’s a smarter breakdown of must-haves and how to save money on each.

1. How to Save Money on a Baby Car Seat

This is the one item you absolutely can’t skip. You literally cannot leave the hospital without one. Look for deals during big sales like Black Friday or Amazon’s Prime Day sales. Some states and nonprofits even offer free car seats to qualifying families.

Although I’m an advocate for second-hand items, I wouldn’t get a used car seat unless I knew the true history of it. Has it been in an accident? Does it have all of its parts and manual? Is it newer than 10 years?

2. How to Save Money on a Crib or Bassinet

Cribs may make a nursery feel complete, but almost everyone I know didn’t even use theirs for the first 6 to 12 months. Unless you count using it as a giant laundry hamper. Most parents opt for a bassinet or co-sleeping arrangement early on.

To save money and the headache of putting another 500-piece contraption together, skip the expensive crib at first for an affordable bassinet. Check Facebook Marketplace or baby thrift stores for second-hand options.

3. How to Save Money on Diapers and Wipes

Newborns go through 8 to 12 diapers a day, so this adds up fast. Buy in bulk from places like Costco or Sam’s Club, and experiment with store brands—they’re often just as good as the name brands. Cloth diapers can save even more in the long run if you’re willing to put in the laundry effort.

Again, TennCare saves us money by granting us 100 free diapers a month.

4. How to Save Money Breastfeeding and Bottle-feeding

Breastfeeding can save a ton of money, and many expecting mothers can get free or discounted breast pumps through their insurance plans—are you keeping track of how much money a good health insurance policy can save you?

If you plan to bottle-feed or supplement, don’t stockpile dozens of the “best” bottles or formula before your baby is born. Babies are picky, and what works for one may not work for another. You can return bottles but you are stuck with whatever formula you buy (usually).

Once you find a winner:

• Grab a bulk deal to save money in the long run.

• Use coupons, shop sales, and check online for discounts—you don’t need to pay full price.

• Invest in durable, high-quality bottles (plastic or glass) that can survive endless washing and sanitizing without falling apart.

• Sign up for formula manufacturer rewards programs like Similac or Enfamil, which offer free samples and coupons.

• Check with your pediatrician for samples and advice on lower-cost alternatives.

Once again, social services save us money every month. We received free formula and still accept food thanks to WIC.

5. How to Save Money on Baby Clothes

Babies grow like weeds, so don’t waste money on brand-new wardrobes. Newborn outfits are cute, granted. However, during those first 8 weeks, your kid will be in onesies the majority of the time. No parent wants to unbutton 40 micro-discs every 2 hours just to have a cute ensemble. And every new parent has an outfit they simply threw out after a god-awful diaper blowout.

Thrift stores, consignment shops, and hand-me-downs are your best friends. Save your splurges for special occasions like communions and holiday pictures.

6. How to Save Money on Newborn Toys

Newborns aren’t clamoring for the latest educational toys—they’re fascinated by you. Your face, your voice, and the way you interact with them are more than enough entertainment for the first few months. Sure, some parents go all-in on overpriced play kits with high-contrast cards, sensory rattles, and “developmental” toys, but honestly, most of this can be DIY’d for pennies.

• Want high-contrast visuals? Draw black-and-white patterns on index cards or use printed templates from the internet.

• Sensory toys? Fill a clean spice jar with rice or pasta for a homemade rattle.

Babies don’t care about brand names—they just want simple things that stimulate their growing senses. Save your money for when they’re older and actually engaging with toys. For now, stick to the basics: talk to them, make funny faces, and let them grip your finger. You’ll be their favorite toy anyway.

Additional Money-Saving Tips For New Parents

1.     Skip the Changing Table - Changing tables are nice-to-have but far from essential. Most parents find themselves changing diapers wherever it’s convenient—on the bed, the couch, or even the floor. Use a portable changing pad instead, which is cheaper, easy to clean, and works anywhere.

2.     Don’t Overdo It on Nursery Décor - While Instagram-worthy nurseries are tempting, your baby doesn’t care about themed wallpaper or designer furniture. Keep it simple. Somewhere to sleep, a rocking chair (used or repurposed), and some blackout curtains are all you really need.

3.     Delay Buying Shoes - Babies don’t walk for months, so skip the expensive baby shoes. Stick to socks or soft booties until they’re actually taking steps.

4.     Borrow Instead of Buying - Ask friends or family with older kids if they have baby gear they’re no longer using. Items like swings, baby carriers, and pack-and-plays often go unused after the first year and are expensive to buy new.

5.     Use Gift Cards and Registries Wisely - If you received gift cards or cash gifts, don’t blow them all at once. Hold on to them for unexpected expenses or to restock essentials like diapers and wipes when they run low.

6.     DIY Baby Proofing - Instead of buying fancy baby-proofing kits, get creative with what you already have. Pool noodles can pad sharp edges, rubber bands can secure cabinets, and furniture straps from the hardware store are much cheaper than “baby-specific” versions.

Invest Those Savings into Your Child’s Future

Saving money on baby gear and clothes doesn’t just help you survive the early years—it’s also an opportunity to start building your child’s financial future. Even small contributions can grow into something substantial over time.

• 529 Plans: These accounts are specifically designed for education savings. Money grows tax-free when used for qualified educational expenses, including tuition, room and board, or even certain K-12 expenses. Bonus: Some states offer tax deductions or credits for 529 contributions.

• Custodial IRAs: If your child has earned income, you can open a custodial IRA for them. The government restricts contributions to the annual maximum limit or the minor’s annual earned income, whichever is less. Starting early gives that money decades to grow. Check out how to start a Roth IRA for minors here.

• Brokerage Accounts: For more flexibility, a custodial brokerage account lets you invest in stocks, ETFs, and mutual funds. While there are no tax advantages, the funds can be used for anything your child needs when they come of age—whether that’s a first car, college, or starting a business.

The money you save on baby essentials might seem small now, but even a few dollars here and there can compound into a significant gift for your child’s future. Whether it’s paying for college or giving them a financial head start, you’ll be glad you made the effort.