Finance Smiths

Personal finance apprentices-in-training

Insurance planning for our baby

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My father-in-law gave us a lift to Orchard this morning for our baby’s first paediatrician appointment since being discharged from the hospital last Fri 8 Nov. He’s okay so far and the next appointment is in 3 week’s time. The cost of this visit was $100 and it got me thinking about the financial coverage we have in place for the baby.

Admittedly, insurance planning is not my strong suit and it’s also not my area of interest. Both my wife and I have similar insurance coverage:

  1. Corporate medical insurance for ourselves that covers the spouse
  2. Personal Integrated Shield Plan
  3. Wholesale Life insurance policy
  4. Dependents’ Protection Scheme

We didn’t get personal maternity insurance when my wife was pregnant. While we could see why it’s necessary, we decided to take a risk and not buy the maternity insurance. Which as you can see from the sequence of events, almost cost us dearly.

When our gynae told us this was going to be a preterm C-section delivery, her next question was – Did you buy maternity insurance? And I remembered thinking to myself now I see why people buy it before answering – No.

Because there was a chance our preterm baby might have to be warded in Neonatal Intensive Care Unit (NICU) for observation and treatment. There was also a higher possibility of pre-existing medical conditions that might cause the baby to be uninsurable. And the additional risk of pregnancy complications.

We are fortunate that the worst case scenario did not materialise and we subsequently found out my wife and the baby could be covered under my corporate maternity insurance. But we can’t depend on luck to help us out like that. We have to get better at insurance planning for our baby’s sake.

POSB Invest Saver – Nikko AM REIT ETF

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As we settle into a daily routine, pockets of time in the day are opening up, which is a good thing. Overnight feeding is brutal and the baby was up every 2 hours last night to feed. The interval was 3 hours the night before and that was still sustainable but 2 hours is really tough.

I can help out now with the overnight feeding being done in the bedroom since I’m still on annual leave. But my wife might have to do the overnight feeding in the living room once I go back to work. Not sure how I can go through a full day in the office with so few hours of sleep. Maybe in the short term but probably not in the long term.

Anyway, I have more time to blog now as the baby is sleeping and we are resting. While the confinement nanny is cleaning our apartment, getting ready to bathe the baby and prepare lunch afterwards. I saw a post about this on Facebook and logged into my wife’s DBS internet banking account to check.

For my wife’s POSB Invest Saver, we set up a new Regular Savings Plan for the newly added Nikko AM Straits Trading Asia ex Japan REIT ETF (CFA). The monthly investing amount is $200 and I hope it qualifies as a category for my wife to earn higher interest on her DBS Multiplier bank account balance. Will find out over the next few months.

With this, we each have $1,700 of automated monthly investment plans into Singapore Equity & Bond ETFs and robo-advisors. The former has distributions while the former is reinvestments. We try to have a mix of passive income cashflow and compounding growth based automated investments.

As we expected, we have very little time for manual investments now and in the near future. Besides, we just want to focus on enjoying parenthood and being present with the baby. Even as I finish typing this post, it’s time for him to feed now. I’m off to go help my wife!

Categories // MIP

Our baby is born and everything afterwards

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It’s been 1.5 weeks since my last post, which is usually normal for me since I have been posting less since the start of this year. However, a lot has happened since then. The most important thing is that our baby is born!

In summary, we were told last weekend that the water level in the water bag was too low and the baby was in a breech position. So a C-section was scheduled a few days later to take the baby out to be safe even though he was slightly preterm at 36 weeks. The recovery period for a C-section is longer and tougher so I accompanied my wife for the 4 day 3 night stay at Mount Elizabeth Orchard Hospital.

The entire experience was surreal and life-changing. Now I know why people who have kids keep saying that. Having to adjust to our baby’s feeding schedule, supporting my wife through the fear and pain of a major surgery & recovery process, etc. We often look at the baby to motivate ourselves to keep going.

Anyway, we have finally been discharged from the hospital and are back at home with the baby now. It’s only been 1 week since we got the news last Sat 2 Nov that the baby has to come out earlier than expected. Here’s some baby delivery learning points for us to remember and they might be useful to you too. Note that it’s dependent on your personal, family, work and financial situations.

  1. If you can, be with your wife for the entire childbirth and recovery process. It’s just a few days but you being there to support her in every way makes a big difference to her experience of having the baby. Everything counts from helping her with drinking fluids, eating food, positioning the baby and pillows for the feed and burping afterwards, etc. It’s going to be bad for your wife but you can make it better for her.
  2. Put your own life on hold and take time off to be with your wife and baby. I’m taking 2 weeks of annual leave this time round and will take another 2 weeks of paternity leave next year. Even if your wife is strong and can handle doing things herself, don’t make her ask for help. Tough women can have breakdowns too.
  3. Be prepared financially. Set aside enough money so you don’t have to worry about expected and unexpected costs of having a baby. Our maternity costs for pre-delivery and delivery (after the Medisave Maternity Package claim of $5,750) is $15,000 for a C-section delivery at Mount Elizabeth Orchard Hospital. Which means the total bill is $20,750 if you add up both the Medisave claim and cash components. The cost of setting up our apartment to be baby-friendly and buying all the baby stuff is $5,000.
  4. Prepare even more financially because there are lots of ancillary costs. We are banking the cord blood and cord lining with Cordlife. We are going with the all-inclusive upfront payment of $11,000 and are using a combination of CDA and cash funds to cover this. We are getting 2 different confinement nannies for 3 months so it’s $3,000 each month i.e. $9,000 in total. The helper is coming in after that and it’s $680 every month after the $2,000 initial set-up costs. Look at how fast the costs are piling up.
  5. Be thankful and grateful for any ang baos and financial assistance with baby expenses you are going to get. Learn about and claim the maternity benefits at the company you are working in. The bank that I work at allows me to claim $5,000 of pre-delivery and delivery expenses as maternity insurance. The bank that my wife works at gives her a maternity cash gift of $3,000. My parents gave me a big ang bao of $5,000 while her parents help paid about $8,000 of the baby expenses. And we got about $1,000 worth of ang baos from relatives and friends so far. Which means we are covering about 50% of all the costs incurred so far ourselves (50% of $44,000 = $22,000).

That’s about it for now. We are still trying to settle into a routine at home with the baby & confinement nanny and it’s going to take a lot of time, effort and work. We lost count of the number of times my wife’s parents had to run errands and make trips for us between their house, our apartment and the hospital. On a side note, my wife got her 2019 performance review remuneration outcome during the hospital stay.

My wife’s bonus is 2.1 months and the annual base salary increase is about 5%. A decent result and welcome news considering everything that’s happened. It’s my turn in Q1 of next year 2020 to get the remuneration outcome of my ongoing 2019 performance review.