I was five months pregnant and my husband and I were down to our last $500. This was one of those times in life when if you haven’t found faith already, you find it, fast.

We had both decided less than a year earlier to build our own business and make it as independent freelancers. Things were moving along, but we were not getting paid at the clip we’d like. We’d still managed to not touch our 401k’s from our previous jobs, and had health insurance through a (very expensive) COBRA plan.

Someone upstairs heard us knockin’ because in a few days overdue checks started pouring in, and we managed to slowly get ourselves back in the black. Expecting a baby though is akin to starting up a business - one with extensive start-up costs and substantial maintenance from day one. The U.S. Department of Agriculture determined a few years ago that a baby’s first year of life can cost anywhere from $6,800 to $10,000 or more. Granted, this business is all about love and nothing about money, but getting practical about how a little one will alter your lifestyle and finances serves everyone well.

Money-Mama that I am, here are some tips on how I hunkered down and planned financially for our daughter’s arrival and how you can get ready for yours:

• Know what your maternity and paternity leave policies are. If you work for a small company and don’t have paid maternity leave, stock up on vacation and look into your disability coverage to close some of the financial gap.
• Know where you stand with your health insurance - if there are any restrictions in terms of hospital stay or procedures such as water-births or use of a midwife. If it will cost you more to stay in a private room, for example, and that’s important to you, make sure to budget for that cost and then some.
• Know how you plan to care for and feed your child for the first couple of months especially. Ladies, if you’re going right back to work and want to nurse, ask your hospital to refer you to a breast-pump rental service rather than buying one yourself, which can set you back several hundred dollars.
• You don’t need half the things that are marketed to you so build a realistic budget with regard to nursery set-up costs. First figure out what is vital, then make a list, estimate costs, and stick to your budget as much as possible.
• Don’t sniff at hand-me-downs -family and friends are great resources for cribs (make sure they meet safety regulations), tubs, play pens, toys, and clothes. Often on eBay you can find whole lots of lightly-used newborn clothing for sale, much high-end, for great prices. Newborns grow out of things very, very quickly so your first year will be a flurry of clothing purchases.
• Crunch the numbers when it comes to childcare. Does it make financial sense to go back to work quickly or will your childcare options cost just as much as your take-home pay? Is it important to you and your career to go back to work? Maybe Mr. Mom can stay home? Have these discussions and tally up the numbers to see just how much childcare will cost so you can plan accordingly.
• Put aside some of your budget for a will. It’s not only about who will take care of your child, but where your money will go. If you want your funds to go to your child, you’ll need to set up a trust, which is an additional cost, but vital in terms of not letting the state mandate where your money goes.
• It’s time for life insurance and disability insurance. If your employer doesn’t offer either, purchase your own, but make sure to shop around.
• Join up with your local parents’ message board - sharing the wealth of information from other local parents can save you hundreds of dollars and you can even arrange a babysitting swap.
• As soon as you can, start up that college account. Automating a monthly deposit or even once a year into a college savings account such as a Coverdell or 529 can take some of the sting out of your child’s post-18 life.