Kids in 5 years. Preparation with finances.

[cbr shadow]

My wife and I have decided to have kids in a few years, likely 4-5 years from now. I feel like we’re on a good path financially, but I’d like to know what else we can do to “prepare” for having kids. My biggest fear is being poor and not being able to afford things for my kid. I’m not talking about design clothes or expensive toys, I just mean school, maybe a college fund, some reasonable vacations and experiences. Ideally at some point I’d like to cut way back on hours to spend more time with our kid, so planning financially now is probably the best bet for that. Here’s our situation so far. What would you change?

We just started investing more seriously last November 2012. I’m part of the Mr. Money Mustache forum and found this forum through there. Since then we maxed our 401k’s, maxed our Roth IRA’s, and cut a ton of things from our expenses. We save just over 50% of our salaries.

Age: 30 (both of us)
Income: Her ~$130k Myself ~$50k, likely to be ~$60-65k next year.
Investments: ~$110k
- 401k’s both maxed
- Roth IRA’s both maxed
- Will start a taxable fund in January after finishing reading “The Bogleheads Guide to Investing”. Hope to put $10k in there this year

Debt: Just mortgage. We owe $194,300 @ 3.5% in 15-yr loan. Home valued at $210k
Net Worth is roughly $200,000

In the last 18 months we’ve made some serious progress..
- Paid off student loans
- Paid off her car loan
- Bought me a car: Used 2006 Honda Civic with 40k miles - $10,500 cash. Decided we’ll never buy a car by financing again.
- Refinanced to get rid of PMI and got into a 3.5% 15-year loan.
- Got rid of lots of goofy expenses that didn’t add value to our lives – Cable TV (watch hulu for free), Expensive gym membership switched to a cheaper smaller gym, insurance updates for auto and home, eat out less and cook more, etc.

We still have tons of luxury and I don’t feel like we’re skimping one bit. We go on a big vacation every year and spend about $3500/year on that trip, plus 1-2 weekend trips.

What other steps can we take to prepare for our kid which should be here in 5 years?

Our house is small. 1265 sqft and 3 Bedrooms. We have 2 medium/large dogs. I think this house would be sufficient for 1-2 kids though. It would be tight, but I think it’s doable. Good neighborhood with very good schools.

I can list my investment details in another post, but I was hoping for just some more general advice if possible.

Thanks,
CBR



Edit: Please keep this as financial advise only. I'm told that Medical advice will cause a locking of this thread. Luckily, medical advice isn't what i'm looking for anyway

[ryuns]

I know it's not very useful advice but: Are you serious? You're fine. Same life position as me but with a higher salary. I'd probably sound the same about finances if I spoke my mind but I know it'd be insufferable. (Just kidding.) The idea of kids stresses me out too, but it's fine. They're a big expense, but you also have a huge cushion of savings and optional lifestyle expenditures.

Keep saving, mostly for retirement. Can't tell if you have an emergency fund, but you'll want that, and then probably start saving for other, longer-term stuff, like the next car you want and conceivably a different house if you decided that was a good idea. I wouldn't pay down my mortgage at 3.5% (possibly tax deductible, depending on other liabilities), but some debt-averse people definitely would. There's nothing keeping you from starting a college fund now and changing beneficiaries later. But that's unnecessary, given 18 years to build it (and that a little scarcity might be good for the kid...) With your salary, the biggest risk would be lifestyle creep and then having a hard time paring back when you cut back on hours and have the extra expense of the kid, but it sounds like you have that licked. Particularly if you're a MMM devotee.

[Grt2bOutdoors]

Hello and welcome to the forum!
You don't disclose whether or not you have an E-fund or savings account. How secure is your employment and will you or your wife choose to stay home at that point or continue working and use a daycare service? You may want to consider beefing up that e-fund if it does or doesn't exist. Kids usually are not that expensive, it's the services like daycare that cost or buying 5 boxes of fundraising chocolate or cookies that you would never think of doing if you didn't have a kid.

What is your asset allocation plan? Do you have one? Is it 80/20 or something else? You could consider the taxabke account portion to be part of that e-fund if the value becomes substantial enough. I just used a savings account for known expenditures that would occur in the short-term 1-3 years. We don't recommend placing money at risk in the equities markets for expenditures that will occur over the next 5 years. Read the wiki for more information on how to develop an asset allocation plan and investment policy statement. BTW, kudos to you for planning this early in advance, at your current rate of savings it's likely you will be able to accomplish your long term goals even if you had to cut back a bit.

Re - college fund. Whether you designate one today or later on, chances are if your income continues at the going rate and with your level of investments (future taxable) your child would likely be offered aid in the form of loans - so to those who think of "scarcity as a motivating factor for the kid", it would be of little avail if the institution look at the parents as being financially capable of paying outright through a combination of EFC and the child knew they would be burdened by the "ball and chain of aid" starting on day one of college. My advice is to just save what you can, but don't forget to smell the roses today. It appears you have the smell the roses part down.

[archbish99]

My wife and I have decided to have kids in a few years, likely 4-5 years from now.

Do be aware that this isn't necessarily realistic unless you plan on adopting an older child. You've decided to start *trying* to have kids in a few years. If it works in a timely manner, great! If not, then you start down the road of medical assistance or starting the adoption process from scratch, either of which may well take several more years before you actually give birth to or are placed with a child. Consider not just when you would ideally have children, but the oldest you'd want to be when you have your first, and allow time for things not to be ideal.

A core Boglehead tenet is that you can't know what will happen in the markets. I'd take that one further: You can't know what will happen in most other venues either.

[shaboob]

I know it's not very useful advice but: Are you serious? You're fine. Same life position as me but with a higher salary.

You beat me to it.

A core Boglehead tenet is that you can't know what will happen in the markets. I'd take that one further: You can't know what will happen in most other venues either.

Pretty much. Wife and I moved from PA to FL a few years back. I took new job; she was ready to open her own business. Guess what? Found out she was pregnant one week after moving here. We were not trying and didn't think we were ready. But actually, financially, we were, and it all worked out. Why? Because we lived below our means, had a decent E-fund, bought less house than we could afford, etc. So between now and then, don't do anything financially stupid. Stay the course and travel a bit. You'll be fine. Don't overthink life.

[cbr shadow]

Thanks for the responses so far!

I don't quite understand why 34-35 yrs old isn't realistic. Do you mean physically for a woman? I have family and friends that have children at that age and older (my parents included). For my generation having kids later seems to be the norm more than the exception. Maybe that's my particular demographic though (I don't know the national statistics).

We do have an emergency fund of ~$37k. It feels like too much to be sitting on, but I guess that's only about 5 months of expenses for us.
It sounds like we should keep plugging away at retirement contributions, keep a large e-fund, and start that taxable account.

[cbr shadow]

archblsh, it seems I misread your post. After a second read I see that you're saying that I can't assume that we'll just "get" pregnant right away. I hear what you're saying and will consider that. I'll also read more carefully from now on

[Andyrunner]

I don't quite understand why 34-35 yrs old isn't realistic. Do you mean physically for a woman? I have family and friends that have children at that age and older (my parents included). For my generation having kids later seems to be the norm more than the exception. Maybe that's my particular demographic though (I don't know the national statistics).

It might take a while to get pregnant. I have friends who took years to get pregnant, others who took one month. So there is that issue.

Also my wife is in medicine. Its much more physically challenging for a woman (longer to recover). Also as she get older the chances of downs syndrome increases A LOT. I believe it is 1 in 400 chance at age 35 and 1 in 35 chance at age 45.

[lrak]

You're obviously doing far better than most! Congratulations!

3.5% is a great loan rate and it wouldn't surprise me if inflation picks that high in the next 15 years. With interest rates so low right now it might not make financial sense but since you mentioned fear ... have you considered putting ~$3.2k/mo towards the mortgage? It would pay off the loan in 5 years. The return isn't great, but 3.5% is guaranteed return and better than CDs are paying (for now). If your lifestyle gets used to that $3.2k/mo drain you should be EASILY be able cover daycare with a dual income, save for college and/or spend a decade as a stay at home dad. Being totally debt free and able to survive on a grocery stocking salary if necessary provides me with a lot of piece of mind. You could alternatively split that amount 50/50 between index funds and the mortgage so you don't get tempted by lifestyle creep and have the option to sell stocks/bonds to pay off the house or fund 529 plan(s) after the baby comes.

The other thing to consider is vacations. There are some kinds of vacation that are kid friendly (beach, Disney), some kinds of vacation that aren't infant friendly (camping, multi-week driving vacations, a week skiing in the Alps), and some that are not at all kid friendly (couples resorts). Take some fun kid free vacations with your wife. Its probably going to be a long time before you get the chance again.

[Grt2bOutdoors]

I don't quite understand why 34-35 yrs old isn't realistic. Do you mean physically for a woman? I have family and friends that have children at that age and older (my parents included). For my generation having kids later seems to be the norm more than the exception. Maybe that's my particular demographic though (I don't know the national statistics).

It might take a while to get pregnant. I have friends who took years to get pregnant, others who took one month. So there is that issue.

Also my wife is in medicine. Its much more physically challenging for a woman (longer to recover). Also as she get older the chances of downs syndrome increases A LOT. I believe it is 1 in 400 chance at age 35 and 1 in 35 chance at age 45.

To avoid a thread lock, let's keep the medical advice out of it. My suggestion to the OP is to consult their physcian at their next visit. The poster above is partially correct, there are many other factors involved.

[Andyrunner]

noted. thanks for the heads up.

[Dave76]

You might be too old to delay child-bearing for 5 years.

[Dave76]

My biggest fear is being poor and not being able to afford things for my kid.

Our house is small. 1265 sqft and 3 Bedrooms. We have 2 medium/large dogs. I think this house would be sufficient for 1-2 kids though. It would be tight, but I think it’s doable. Good neighborhood with very good schools.



Thanks,
CBR

You don't seem poor to me!


Couples raised (and continue to raise) 2 and 3 children in 3 bdr Levittown houses. I grew up in a Sears prefab that was probably about 1,200 sq ft.

[Grt2bOutdoors]

My biggest fear is being poor and not being able to afford things for my kid.

Our house is small. 1265 sqft and 3 Bedrooms. We have 2 medium/large dogs. I think this house would be sufficient for 1-2 kids though. It would be tight, but I think it’s doable. Good neighborhood with very good schools.



Thanks,
CBR

You don't seem poor to me!


Couples raised (and continue to raise) 2 and 3 children in 3 bdr Levittown houses. I grew up in a Sears prefab that was probably about 1,200 sq ft.

And spending quite a bit of money on those home today not including ridiculous taxes too!

[Rainier]

Have the kids now,or at least start trying. Get the diaper years over with ASAP. Who wants to be 40 with a toddler?

Financially, you are doing fine.

[bungalow10]

From your post it sounds like your lives are pretty stable. I echo others that have encouraged you to consider starting your family sooner rather than later. You might decided you want 3-4 kids and, well, it takes a few years to accumulate that many if you have them one at a time

While you are at it, start looking into the daycare options and cost in your area.

[rainyday1]

We lived on one salary (the lowest one!) before we had kids and saved the other. Husband made 100-125K. I made 50K. By the time the baby came along, we had a nice pile of cash and were used to living well below my husband's income. That gave us lots of options - we could afford daycare if we wanted to or I didn't have to go back to work at all. You could pile up cash and then you could pay off your mortgage if you wanted to or invest in a taxable account. It's great to have options.

Once the baby fever hits, baby seems to come along sooner rather than later. You will be fine financially if you don't wait 5 years - and I concur with whoever said get the diaper years over with as soon as possible! Those are a couple of long years.

DO take one nice vacation before wife is pregnant. Vacations aren't that much fun when you feel like a beached whale... or when you have morning sickness that lasts 24/7.

[Grt2bOutdoors]

Have the kids now,or at least start trying. Get the diaper years over with ASAP. Who wants to be 40 with a toddler?

Financially, you are doing fine.

No big deal! Oh! The horrors!

[bungalow10]

Have the kids now,or at least start trying. Get the diaper years over with ASAP. Who wants to be 40 with a toddler?

Financially, you are doing fine.

No big deal! Oh! The horrors!

Don't you know - toddlers poop more then their parents are over 40

[cbr shadow]

Thanks everyone for the information and opinions!
What I haven't mentioned, is that we're not 100% sure we even want kids at all. We've always thought we wouldn't at all, but my wife now says that she may be changing her mind. I may too, so I figure we have about 5 years left to decide for sure.
One (of many) thing that always made me nervous about having kids was the financial burden. I know poor people raise children too, but I want to be in a very stable financial situation overall and have options to retire early possibly.
I know a lot of people feel a really strong internal drive to reproduce and to care for a child, but that must've skipped me. I think I would be content spoiling my brother's daughter and possibly paying for her college, but of course if my wife really wanted a child I wouldn't force what I want on her. When we met we both agreed that we didn't want any kids.

Anyways, that's the reasoning for not "starting early". We're also both at points in our career where we're moving upward fast (her especially) and I know that having kids could slow that down significantly.

[yatesd]

You are fine financially, although I think your concerns are misplaced.

[Aghast]

You should also factor into your calculations the cost of IVF and other costs and risks related to waiting 5 years and having children later on in your reproductively-capable years.

[LadyGeek]

This thread is now in the Personal Finance (Not Investing) forum (financial planning for a life-changing event).

Please stay on-topic, which is the financial aspects of the OP's question.

[letsgobobby]

Our financial situation was in your ballpark. We delayed kids until later. My wife was 32 for our first, 35 for our second. We had a plan just like yours, all mapped out and everything.

You know those couples who can just look at each other and BAM! pregnant? That's us. In other words, we got pregnant precisely on schedule, to the week more or less. (It must run in my wife's family - her two sisters, both teachers, planned and successfully conceived all four of their kids at exactly the right moment to give birth in the spring, take their full 12 weeks of maternity leave, and then have it run seamlessly into summer break so they could get 5 months of consecutive home leave with their newborns. Amazing, actually.)

I point all that out because now, at age 39/40, even if we occasionally think we might have wanted a third child, it's basically too late for us. Sure, it's medically possible, and people do it all the time, but:

- my body has aged in the last five years. It might be the kids themselves who have contributed to it. It might just be hitting 40. But I would be hard pressed to sustain the energy needed to care for a newborn, and then a toddler, at this age. Not to mention a career, a marriage, two active kids, etc.
- the risk of fetal malformations rises steadily after maternal age 35. This is a real concern. And you don't know if you're the BAM! pregnant type until you try it. My poor sister, 36 now, has been trying for years, and no dice. Things worked out well for us but in retrospect we got lucky. If we had had difficulties getting pregnant and/or sustaining a pregnancy, we could easily have been in our late 30s or early 40s before one or both children were born. If I could go back in time and give my younger self advice, I would have advised starting about 2 years earlier.

Yep, kids interfere with career trajectories. Yep, they change lifestyle. Yep, you'll give up a lot. You have to make your own decision about kids, yay or nay. What I'm saying is don't wait til the last minute to have kids - unlike finances, you can't plan this stuff out to 2 or 3 significant digits.

How does this relate to finances? I also was anxious about having enough. I always felt waiting one more year was better, because we'd have more saved up, be more advanced in our careers, have gotten one more exotic trip in, have a higher income. The problem is there's no end to that way of thinking. At some point you just have to take the plunge. You make enough that you can afford kids. Money isn't the issue. In your case, it simply isn't a factor at all.

Probably, if not for my wife's insistence, I'd still be feeling we didn't have enough and weren't ready. She was definitely right - we started none too early and probably should have started earlier.

[TRC]

Thanks everyone for the information and opinions!
What I haven't mentioned, is that we're not 100% sure we even want kids at all. We've always thought we wouldn't at all, but my wife now says that she may be changing her mind. I may too, so I figure we have about 5 years left to decide for sure.
One (of many) thing that always made me nervous about having kids was the financial burden. I know poor people raise children too, but I want to be in a very stable financial situation overall and have options to retire early possibly.
I know a lot of people feel a really strong internal drive to reproduce and to care for a child, but that must've skipped me. I think I would be content spoiling my brother's daughter and possibly paying for her college, but of course if my wife really wanted a child I wouldn't force what I want on her. When we met we both agreed that we didn't want any kids.

Anyways, that's the reasoning for not "starting early". We're also both at points in our career where we're moving upward fast (her especially) and I know that having kids could slow that down significantly.

Financially you are fine. The real question is do you want kids? It sounds like you and your wife care more about finances and your career advancement than starting a family.

[ramsfan]

Some other ideas on financially preparing to consider.....

If you have any idea how many kids you may have some day, be on the lookout for a great deal on the house you would want to live in to support that, you don't want to get a situation where you are desperate to move to a bigger house, pay too much going to that house, accept too little to sell your current house.
Also, at some point consider moving to the area where you want to raise your family. Big thing to consider is public versus private schools. We chose to move to the area with the best public schools, and it is really awesome. If we were to live just 5 miles in any direction, we would likely be looking at private school.

From a pure financial viewpoint, private education is a big expense. We have peer couples that we know well spending 20, 30, 40k a year on private education.

Also, make sure and get your health insurance in order, it never ceases to amaze me how many times we end up at the ER.

Hope this helps - good luck.

[tadamsmar]

I think you could start a 529 of Coverdell for yourself and roll it to your kids in the future. This could give you more tax-free savings growth. And you might get a state tax break on the contributions. The 529 rollovers are gifts and limited by the gift limitations on a year by year basis - not sure if Coverdell rollovers are gifts.

[jackholloway]

Thanks everyone for the information and opinions!
What I haven't mentioned, is that we're not 100% sure we even want kids at all. We've always thought we wouldn't at all, but my wife now says that she may be changing her mind. I may too, so I figure we have about 5 years left to decide for sure.
One (of many) thing that always made me nervous about having kids was the financial burden. I know poor people raise children too, but I want to be in a very stable financial situation overall and have options to retire early possibly.
I know a lot of people feel a really strong internal drive to reproduce and to care for a child, but that must've skipped me. I think I would be content spoiling my brother's daughter and possibly paying for her college, but of course if my wife really wanted a child I wouldn't force what I want on her. When we met we both agreed that we didn't want any kids.

Anyways, that's the reasoning for not "starting early". We're also both at points in our career where we're moving upward fast (her especially) and I know that having kids could slow that down significantly.

We started at 37. I wish we had started a few years earlier to give us the option of a second pre-40 with a four year gap.

You are certainly in good enough shape to raise a child, or several of them. If you have more, you can find more to spend it on, but as others have said, kids are pretty cheap. Do try living on only one income for necessities and fun, so you have a realistic grasp of your choices.

[Draak]

Things to prepare for:

How long will your wife want to take off work associated with having a baby? If it is more than the medical leave, make sure you plan to cover lost wages for that time.

Can you support your fixed expenses if you are the only one bringing in a paycheck? You want to get as close to that as possible so that if she decides not to work, divorces you, or passes away you are not in a sudden financial crisis as well as emotional crisis (this is one of the mental shifts you have to make when you have kids).

Do you have LTD insurance? Important to think about that in case one of you becomes unexpectedly ill or injured and needs significant care.

Do you have term life insurance? If you are in perfect health, now might be the time to get 500K - $1M term policies on both of you. The older you get the more difficult it is to get these policies at a good rate.

Your EF can be mostly sitting in investments. You only need your '4 day emergency' amount in cash and the rest of the money readily liquid, so you can get to it in a few days if needed.

Will your vehicles fit baby seats? Keep that in mind as you buy your next cars - 4 door and enough back seat to fit the big chairs for the early years.

Family Vacations get a lot more expensive & cumbersome with children involved. 1 is easy. 2 are exponentially more logistics/stuff/juggling. Your destinations won't be the same and the costs will be higher. Think about what is important to you in a vacation. If it is beach destinations you want to explore less costly places like Mexico (instead of Hawaii). If it is international travel, then maybe try Turkey instead of France.

Do you have any bad habits like smoking, drinking, gambling? Get rid of them now!

[stan1]

The real spending starts after the kids are born so I think its important to think about how you want to raise your family. I think its important to establish and maintain a lifestyle that reflects your values and to join adult and child peer groups who maintain similar values. A 7 year old can have a fabulous birthday party at Legoland or at a nearby public park. The Legoland party may end up costing about $1000 whereas the public park party might end up costing about $200 (with a really nice cake). It is very hard to say "no" to the Legoland party if all of your child's peers are having similar parties. It is very hard to avoid the temptation to "keep up with the Jones'", especially if the Jones make a lot more than you do. This is true of the kids as well as the parents. Another controversial topic: sending your kids to private school even though you are paying property taxes associated with living in an area with very good public schools. Some activities like swimming, dance, and music are well worth the money.

[lrak]

Can you support your fixed expenses if you are the only one bringing in a paycheck? You want to get as close to that as possible so that if she decides not to work, divorces you, or passes away you are not in a sudden financial crisis as well as emotional crisis (this is one of the mental shifts you have to make when you have kids).

You bring up a good point. If they have kids, the OPs wife looses the ability to decide she doesn't want to work. I'd LOVE to quit work and be the stay at home parent, but we couldn't support ourselves in our area in my wife's chosen field of work. Therefore I work and she stays at home with the kids. The OPs wife needs to pay child support in the event of a divorce, have life insurance in the event of death, and have long term disability insurance cover the rest.

[expat]

If you decide you like having kids, you won't have much time to have them if you wait until 35.

[blackdust]

You might be too old to delay child-bearing for 5 years.

What about grankids? IF you have kids at 35 then you cant have grankids until your 55 - 65!! I love kids though so I made sure to start when I was 19 and finished when I was 21. I have two kids then got fixed. My kids will be 20 when I am 40 so I will have grankids and I hope to see great grankids before I leave this world.

[blackdust]

One (of many) thing that always made me nervous about having kids was the financial burden. I know poor people raise children too, but I want to be in a very stable financial situation overall and have options to retire early possibly.

I can see what your saying. For me money would not stop me from having kids or doing anything I REALLY want to do.

[Grt2bOutdoors]

You might be too old to delay child-bearing for 5 years.

What about grankids? IF you have kids at 35 then you cant have grankids until your 55 - 65!! I love kids though so I made sure to start when I was 19 and finished when I was 21. I have two kids then got fixed. My kids will be 20 when I am 40 so I will have grankids and I hope to see great grankids before I leave this world.

Umm....really? You can certainly have offspring much earlier than age 19, and it's perfectly legal in all 50 states and countries worldwide.

[Kosmo]

I skimmed through, but the first response was right on. You're fine. We've got 2 kids, less income, and more debt...and we're making it without issue.

[blackdust]

You might be too old to delay child-bearing for 5 years.

What about grankids? IF you have kids at 35 then you cant have grankids until your 55 - 65!! I love kids though so I made sure to start when I was 19 and finished when I was 21. I have two kids then got fixed. My kids will be 20 when I am 40 so I will have grankids and I hope to see great grankids before I leave this world.

Umm....really? You can certainly have offspring much earlier than age 19, and it's perfectly legal in all 50 states and countries worldwide.

Your right. But the chances or slim that an underage kid would have kids. OP you have way more income than I do and I live pretty good i.e. have cars, smart phones, own my own house, flat screens, ipods for the kids + latest toys, gaming systems. My income sits around 20k a year for two toddlers and a wife. I like the 529 plans for the kids college tough.

[LadyGeek]

What I haven't mentioned, is that we're not 100% sure we even want kids at all. We've always thought we wouldn't at all, but my wife now says that she may be changing her mind. I may too, so I figure we have about 5 years left to decide for sure.

No one has asked two key questions:

-If something bad happened to you, would your wife want to raise the kids herself?
-If something bad happened to your wife, would you want to raise the kids yourself?

Assume there is no one else available to help. Unless the answer is "yes" to both questions, you should rethink your decision.

No one can answer this question but you and your wife, and it must be done without influence by friends or family (or this forum). We don't need your answer here. Financially, it sounds like you are prepared.

[sscritic]

-If something bad happened to you, would your wife want to raise the kids herself?
-If something bad happened to your wife, would you want to raise the kids yourself?

The answer after you have kids might be completely different than the answer you would give today. Now I admit I wanted to have kids, and when my wife died, I tried to love them even more to make up for what they had lost (and they were also helping "raise me" at that point). Your kids are your family if your spouse dies. It's that simple.

[ginyah]

I think you are doing well financially. My only advise would be to keep the house you have now and raise your children there. Kids really don't need a big house. If they need room to play there is the whole outdoors to use - good for noise control and for health/physical development. If you have two children of the same sex you might even want to consider having them share a room so you have an extra room for guests/office/escape. It takes learning how to compromise to share a room with a sibling which is a great life skill. Yes, they will argue but they will also bond in a way that will last a lifetime. One of the things I found most interesting about The Millionaire Next Door is that by not allowing lifestyle creep you can actually accumulate more while enjoying a wonderful family life. I definitely wouldn't start any kind of college savings before the children actually are born. Put your money into retirement savings so that your children will not have to use their resources to care for you in your old age. Best Wishes!

[Cash]

My wife and I are also 30 with good incomes and plans to start having kids in 4-5 years. Our plan is to continue to minimize expenses and save as much as possible, recognizing that future savings and perhaps some of our current savings might be diverted to child expenses later on. There's not much else that I have seen people recommend to do in advance, except perhaps funding 529s to take advantage of the tax deduction. From what I understand, you can change the beneficiary of a 529 if your plans don't work out (perhaps to a niece, nephew, or cousin), but it seems quite premature to start one this early, so I haven't gone down that road yet. In the meantime, we're enjoying the DINK life of nice vacations and frequently eating out for a few more years .