Managing Money on Maternity Leave

Planning a nursery, buying newborn necessities and awaiting your little one’s arrival is foremost on your mind when you discover that you are expecting. However, planning a budget and preparing financially for your maternity leave is just as important.

It is also important to be aware of the paperwork involved when applying for mat leave. A ROE (record of employment) must be submitted, a set number of hours must be worked, and you must provide your child’s birth date.

Service Canada states that “The basic benefit rate is 55% of your average insured earnings up to a yearly maximum insurable amount of $41,100. This means you can receive a maximum payment of $435 per week. Your EI payment is a taxable income, meaning federal and provincial or territorial, if it applies, taxes will be deducted.”

The best thing you can do when you find out that you are pregnant is to create a budget and financial plan for your maternity leave. This will ease the pressure of trying to budget after the baby has arrived.

Consider the following when creating a budget:

Biweekly Income:

1. How much will your maternity benefits pay after taxes?
2. How much top up will you receive from your employer?
3. How much money does your partner/husband make per week?
4. Will you be earning extra money while on leave?
5. Add it all up – total biweekly income = ______________

Biweekly Spending:

1. Rent or mortgage costs
2. Utilities – heat, water, telephone etc.
3. Car or travel expenses
4. Car and house repairs (unexpected costs)
5. Grocery bill – including baby needs (formula, baby food etc.)
6. Medical costs – medicine, ear drops, eye drops, glasses etc.
7. Toiletry Costs – toilet paper, skin care, diapers, shampoo, soaps, creams etc.
8. Cost of entertainment, gym membership, hair cuts, eating out, cell phone, internet etc.

Add it all up – total biweekly spending = ______________

** Be prepared for maternity leave and the two week unpaid waiting period. Save now for emergencies and to get you through any unexpected expenses.

** Try tracking how much you are spending now to get a true sense of your spending habits.