Author Topic: Preparing for maternity leave (in Canada). Tips welcomed / suggestions.  (Read 6347 times)

mld

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Hello! I am lucky to have a job that will offer paid maternity leave of 1 year with almost my full salary. Now this will be our first baby and I want to be prepared to do the right moves before as well as during the maternity leave. Obviously, any move that brings us closer to FIRE is more than welcome but I do want to take advantage of that year to spend as much time as possible with our baby.

So if anyone as recently taken a full year of maternity leave and has some suggestions for me that would be great. :) Some things are more Canada specific (like taxe related questions) but all kinds of tips are more than welcome. If this helps, I work in a federal department.

My maternity leave will start in October 2014.

Here are a few questions that come to mind:
  • I have been told that I need to make a few decisions with regards to what is taken off my pay such as pension / disability contributions / taxes. Pension and other deductions can be bought back in the following years (I'm thinking of just asking for the same payments as I always do for those aspects). 
  • As for the taxes, most people tell me they did not get enough money taken off their pay checks to account for taxes and ended up with a big bill in April. I'm not sure if I am better of investing the extra income I get from not getting that money removed from my paychecks and then preparing myself for the payment when it comes in April....
  • Other than that, I am not sure what else comes to mind right now but if you have any Mustachian ideas for that upcomming year of maternity, feel free to share them!

Blue girl

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Congrats!
I don't really have much advice, but I'm halfway through my mat leave and this is what I've been doing. you are lucky, I only had top up for the first 17 weeks.

With extended benefits (dental, etc.) I had the option of dropping them all during this time. However we kept everything with the exception of counselling services. I didn't think dropping say disability insurance etc. was worth the savings. I also decided to keep up with the pension contributions. Keeping up with the pension was a tough decision (I am still young (30), our mortgage is nearly paid off with no other debt so just saving for FIRE soon, I work in IT and thus will likely quit before normal retirement at my organization) however my husband is a lil spendier than me, and since we are not sure about another child, I figured better safe than sorry. The job is stable and great paying, so If circumstances change and I end up staying with this employer for quite a long time then I'm covered.

One thing that caught me off guard with having a baby -- how hard/painful breastfeeding is. I threw in the towel and bought a tin of formula at 6 weeks, but my LO refused it and I was too cheap/health conscious to try other brands (there are limited variety of organic formula out there), so I was forced to stick it out and now I am glad I did.

If you want a breast pump call up your health insurance provider to see if they cover it. Mine did at 80 percent even though it was not indicated in the coverage booklet. Having said that though, I find that I hardly use the pump, so in hindsight I shouldn't have bought it.

I thought I would have a lot of free time to do things during this period but that was not the case initially. Things are getting better now, and I'm finding time to do things to save even more money, like making my own bread, yogurt, tortillas, spring rolls etc. my walks with the LO are now to different grocery stores to hunt for reduced foods and deals.


Anyways hope that helps.

Blue girl

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Oh I should also mention, I garage sales or craiglisted nearly everything I needed for the baby -- stroller, ergo carrier, baby clothes, toys.... I wouldn't recommended used carseat though for obvious reasons.

Ohhhh... And cloth diapering is great, but be prepared for a few leaks in the beginning if the baby is quite small. I find though they don't hold up that great at night so we still use one disposable at night.a

Another thing, I didn't know at the time, but you don't need to declare the top up when you apply for the mat benefits. It took me a bit of time to find that info out.
« Last Edit: May 12, 2014, 04:43:45 PM by Blue girl »

MooseOutFront

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Hello! I am lucky to have a job that will offer paid maternity leave of 1 year with almost my full salary.
Dayummmnn!  That's unbelievable.  We should have moved to there for the child bearing years.  We'll have 12 weeks unpaid when the baby comes next month.

Weyfarere

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Dayummmnn!  That's unbelievable.  We should have moved to there for the child bearing years.  We'll have 12 weeks unpaid when the baby comes next month.
Your job doesn't have Short Term Disability insurance?

MayDay

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Many small employers don't.  Even if they do, it is often for 6 weeks only, and not full salary.  I worked for a fortune 50 and got six weeks paid at 60%. 

Blue girl

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Many small employers don't.  Even if they do, it is often for 6 weeks only, and not full salary.  I worked for a fortune 50 and got six weeks paid at 60%.

Is there a min. That the US government sets for allowing time off? I can't imagine how difficult it must be to go back to work so fast for those who have no choice.
 
Here in Canada I have a year off (combination of mat and parental leave), and get paid 55% of salary up to a certain max. This is thru the governments employment insurance. My employer, privately, tops me up to 95% of my salary for the first 17 weeks. Remaining 5% when I return to work and work for at least 6 months. I thought this was really generous, but OP's top up for the whole year, wow!


mld

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Thank you Blue Girl for all your great tips :). I may contact you in the future as the maternity leave comes closer for tips (also other new mommy tips as you've mentioned things I had not considered - such as how hard breastfeeding can be).

Yes, the maternity top up is at 93% of my salary for the whole year. I am aware that this is way more than most people get. That is one of the main reasons I decided to take this job when I had other interesting offers at the time. I am extremely lucky to have this benefit and that is why I want to take as much advantage of it as possible.

Anybody have more tips on how I can be more mustachian about having such an advantageous leave? I'm really debating the not taking extra money off the weekly paychecks to prepare for the taxes and instead putting that extra money on our mortgage during the year.

RetiredAt63

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It's a while since I did this (DD is 24) but for my leave the base was EI and then employer topped up, so there was paperwork.  Make sure you are clear about what you need to do for yours.

There was a forum post way back when about the costs of children, lots of good baby info in it, and in the comments.  Babies grow so fast, you should be able to get almost everything in good condition second-hand.  And don't buy special-purpose furniture, it is not necessary.  Just be sure to change diapers on a high-enough surface, protect your back.

Re breast-feeding and diapers - mother's milk digests faster so baby gets hungry again sooner.  We found that night-time feedings were easier with a low-level night light in the bathroom - feed one side, change diaper in very dim light, feed other side, baby falls asleep and doesn't get woken up again by being changed.  Also, this meant that diapers were less likely to leak, because they tend to be changed at the same time as the feeding.



Thegoblinchief

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The withholding question really comes down to your finances. I tend to like having the cash in hand, as long as I know approximately what the tax bill will be.

Enjoy the generous mat leave. My wife's company is considered generous for offering 6 weeks at full pay. I believe the statutory requirement is 6 weeks unpaid, which is among the worst in the world.

GuitarStv

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Get all your finances in order and automated.  Automated bill and mortgage payments, automated RRSP and TFSA contributions, investments all in order, etc.  Get all the baby stuff second hand.  You don't want to have to think about anything.  Get whatever you want done around the house long before the baby arrives.  Have disposable diapers ready even if you're planning on using cloth ones.  Pack your freezer with frozen stuff that can easily be heated up.  Try and figure out if it's possible to schedule some relatives to come by to help in the first few weeks.

My wife had a long, difficult delivery in December.  It was about three weeks before she could walk around again.  Then there were difficulties breast feeding.  Our baby screamed for the first month or so of life, stopping only for 30-60 minute naps every couple hours to regain his voice.  Sleep deprivation does bad things to you.  When you feel like smashing the baby into the wall, leave the room and breathe.  Don't expect to be doing much of anything for at least four months.  Maybe things will workout and be wonderful for you . . . but for us, having a newborn was more challenging than expected.

MooseOutFront

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Dayummmnn!  That's unbelievable.  We should have moved to there for the child bearing years.  We'll have 12 weeks unpaid when the baby comes next month.
Your job doesn't have Short Term Disability insurance?
It does if you opt to pay for it.  Which we did, but still it only pays out after you use all your vacation and sick days up so it will end up paying us 60% of her salary for about a week and a half. 

RetiredAt63

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Your question was on finances, but GuitarStv is so right about the sleep deprivation.  Plan for it.  Warn your husband that he may be doing a lot of baby care while he is home, you will be the one up in the middle of the night while he is sleeping.  My DD would have been screaming for two hours, my DH would come home, and she was so happy to play with him that the crying stopped. And when your baby naps, you nap!

Get all your finances in order and automated.  Automated bill and mortgage payments, automated RRSP and TFSA contributions, investments all in order, etc.  Get all the baby stuff second hand.  You don't want to have to think about anything.  Get whatever you want done around the house long before the baby arrives.  Have disposable diapers ready even if you're planning on using cloth ones.  Pack your freezer with frozen stuff that can easily be heated up.  Try and figure out if it's possible to schedule some relatives to come by to help in the first few weeks.

My wife had a long, difficult delivery in December.  It was about three weeks before she could walk around again.  Then there were difficulties breast feeding.  Our baby screamed for the first month or so of life, stopping only for 30-60 minute naps every couple hours to regain his voice.  Sleep deprivation does bad things to you.  When you feel like smashing the baby into the wall, leave the room and breathe.  Don't expect to be doing much of anything for at least four months.  Maybe things will workout and be wonderful for you . . . but for us, having a newborn was more challenging than expected.

CarDude

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Many small employers don't.  Even if they do, it is often for 6 weeks only, and not full salary.  I worked for a fortune 50 and got six weeks paid at 60%.

Is there a min. That the US government sets for allowing time off? I can't imagine how difficult it must be to go back to work so fast for those who have no choice.
 
Here in Canada I have a year off (combination of mat and parental leave), and get paid 55% of salary up to a certain max. This is thru the governments employment insurance. My employer, privately, tops me up to 95% of my salary for the first 17 weeks. Remaining 5% when I return to work and work for at least 6 months. I thought this was really generous, but OP's top up for the whole year, wow!

This is one of those ugly little truths about the US. We're one of only about three or four countries on the planet that don't mandate paid maternity leave. Here you're eligible for 6 weeks unpaid, and that's it.

CarDude

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My wife had a long, difficult delivery in December.  It was about three weeks before she could walk around again.  Then there were difficulties breast feeding.  Our baby screamed for the first month or so of life, stopping only for 30-60 minute naps every couple hours to regain his voice.  Sleep deprivation does bad things to you.  When you feel like smashing the baby into the wall, leave the room and breathe.  Don't expect to be doing much of anything for at least four months.  Maybe things will workout and be wonderful for you . . . but for us, having a newborn was more challenging than expected.

This is definitely true, especially the smashing baby part. And let your husband help you. A lot of type-A moms have trouble with that, whether it involves housework, changing diapers, bottle-feeding, etc. And acting like a single mom when you're not will only leave both you and your husband frustrated unnecessarily. This is something I've seen in a lot of young and educated couples with the first baby.

Rebecca Stapler

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As for Mustacian advice ... PP had a great suggestion about getting used baby gear. In the US, there are a lot of semi-annual consignment sales that last for 2 days at a time. You can stock up on just about everything your baby will need in the next 6 months, for 70% off retail. E.g, a jumperoo that's usually $110 will be $25. It's especially true for infant gear, because it's used for such a short period of time that it's usually in great condition.

Do you know what you'll do for care when you return to work? Do you know how much it will cost? During maternity leave, I would automatically save the amount of the tuition each month. That way, you'll be used to living with that expense by the time you return to work. And you can put it towards building up your E Fund (if you need to) or debt payoff that will result in lower monthly bills or saving it for any future big purchases. Putting it towards retirement or paying down your mortgage are good too, but you may find that once a child is in the mix, you feel a need for more financial security in the sense that you want a bigger cushion or fewer monthly bills. (IDK your specific financial situation).

Explore the free activities near you -- playgrounds, libraries, walking trails, indoor playspaces at the mall or community centers, etc.

Find mothers' groups -- whether it's for breastfeeding support or moms in your neighborhood or whatever. If you can find some sort of affinity group, it may help prevent any stir craziness and it will be a great resource for you to see what other moms go through (the same kind of stuff you'll be dealing with!) It will also help build your repertoire or free things to do, like playdates at each others' homes. And, if the kids are different ages, you may find yourself the grateful recipient of lots of gently used baby gear ;)

I cloth diapered my son, and we plan to do it again for #2 (due in November!). If you have a washer and dryer at home (and a place to air dry is a big bonus), then it will take a total of 30 minutes out of each day to save a ton of money and the hassle of constantly buying diapers. Bonus if you make your own cloth wipes too. I think we'll do that this time around, since they'll just get tossed in with the cloth diaper wash. Although, we will probably have some wipes for the nasty jobs that we won't want to clean off the wipes! (sorry, is this getting too TMI?)  All told, we spent somewhere around $900 on fancy diapers and detergent over 3 years of cloth diapering. Depending on how much you would spend on disposable diapers, this can save you some money. (I have seen estimates of $30 to $85 -- if you spend $30, you're only saving $200 over 3 years, but if you'd spend $85/mo, you'd save over $2k in 3 years).

CarDude

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Yes, definitely cloth diapers. With a washer and dryer, it's so easy. Within a month of doing it, the idea of spending money on disposable diapers will seem nuts.

going2ER

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I also had a top up with my maternity leave and because of this actually had more "take home" money than when it was just the pay cheque. I would continue paying your benefits when you are off, you never know what will happen. I didn't end up owing on income tax, but if you do an RRSP that may offset it enough. I wouldn't worry about prepaying the mortgage as it likely isn't at a high interest rate. The rest I would save or invest.

I found the first few months were really busy so you don't have much time to go spend money, but when things quiet down make it a habit to do free or inexpensive things like going for walks.

Like others have said, babies don't need to be expensive. If you can breastfeed. If you can't don't worry about it. Some people will make you feel like you are feeding your child poision, but you need to do what is right for you and baby. I would recommend nursing bras and some reusable nursing pads, so no, nursing is not without some expense. I also had a breast pump that I rarely used as my children were almost always with me. Nursing does come with a learning curve so be patient, I found that around the 3 month mark things really got so much better.

Put the word out that you are expecting and many people will be offering up items for you.  For those things that you don't get try to determine if they are necessary and where you can get them used or inexpensively.

Congratulations and enjoy this time, it really is great.

Prairie Stash

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Our extra taxes came due.  The 55% EI payment didn't withhold taxes like our regular paycheque. Basically we owed the marginal tax rate on the EI part.  It was a few thousand dollars, manageable but annoying. As long as you're aware then you'll find a good way of handling the extra payment (or you'll receive a smaller refund than you initially expected, also annoying). I had initially planned for the refund to go to the RESP. In your case I would pay off the mortgage and use a Homeline plan to ride out the bump.

Apply for UCCB soon, it's retroactive so no worries about waiting a few months. We get $100/month, the retroactive was $1000 since we got our paperwork in 10 months after birth. If your household makes good money that's all the benefits.

We also applied for the birth certificate soon.  We then used it for the SIN card so we could set up the RESP which I retroactively paid into a year late (I dabbled with the thought of using Heritage education and then spent time unwinding that mistake).

My wife cancelled benefits and relied on mine.  Before that happened we did all the preventative maintenance we could; eye appts., dental, filling prescriptions etc.  It's funny how often we let those things slide, even when they're free. We saved about $1000 by suspending, I was confident that would more than cover any out of pocket expenses. Of course that's with 2 parents working, single parents don't have the luxury.

We did disposable diapers on sale.  My wife was brilliant and we spent less than $20/month (average over the first 2 years).  We hit a great sale and have enough for the rest of the year for less than $100, that was pretty impressive of her.  Everyone's story will be different though.  We spent less then some other posters did on cloth though; plus saved on water, gas etc.

mld

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I just wanted to thank you all for the amazing responses! I will re-read them very carefully since we got so much great info.

As a quick note, the responses that included info on sleep deprivation and more logistic than financial aspects of having a new born are also very helpful. In the end they also relate to finances since it made us rethink our renovation plans for before the baby comes. We also had lots of things where we were saying oh this doesn't have to be done before baby comes since we'll have a few months to fix X or Y before baby starts crawling or sleeping in his own room. By reading your replies, we realized we have to be more realistic with our expectations of what we will be able to do when baby comes (not much ahah) and we need to plan ahead!

I cloth diapered my son, and we plan to do it again for #2 (due in November!).
Congrats for baby number 2 :).



homeymomma

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This is not a super helpful response, but just wanted to say congrats! We're also due in October (second baby).
I'm a sahm so I've never had to navigate the leave situation, but wanted to share a tidbit from my friend who was recently on maternity leave. She used up 1 vacation day per two week pay cycle in order to stay in her employers system for retirement, taxes, etc. This was in the US and her employer was a large hospital so it unlikely that's relevant to you, but I wanted to put it out there just in case.

Definitely ask anyone you know who has taken maternity leave recently to see what they did and if it was beneficial.

Congrats again! Good call on lowering expectations about what you'll be able to handle after baby arrives. We had postpartum complications last time, which exacerbated things, but I could literally barely feed myself and baby and take a shower most days until at least the third month.

TrMama

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Congratulations! Both on the baby and on having a job that tops up so well. I didn't get any top up, but my DH got the same top up as you. We ended up splitting the year between us. It was the best, and hardest, thing we ever did.

I would continue to contribute to your pension and benefits while on leave. This will likely be your child's cheapest year. They generally only get more expensive as they get older and it will be harder to buy back your time later. If you can get good benefits coverage through your spouse's employer, then consider dropping yours. However, you're not any less likely to get sick or injured just because you're not working.

Get on the waitlist for daycare now. Only skip this if you already have a solid plan for childcare. Read up on form T1213 from CRA if you have to pay for daycare. It will help you avoid having a gigantic refund after your first year of paying for childcare.

Use your mat leave to take at least one trip. You have the time off, you can shop for deals on flights and fly at off times and babies under 6 mo are super easy to travel with. I wish I'd done more travelling with my first. I did figure this trick out for my second, but by then I also had a 2 yo to bring . . .  Get an ergo type carrier for the plane. The best trips are to go see family members so you have a place to stay and extra hands to help with the baby.

Go check out a bunch of books from the library on "How to Get Your Baby to Sleep". Read a variety of different philosophies. That way, you'll have lots of different tricks up your sleeve when it's 2am and you just want to die from lack of sleep. As I learned the hard way, babies need to be taught how to go to sleep, and stay asleep. This doesn't happen all by itself over time.