2023 Author: Anita Thornton | [email protected]. Last modified: 2023-05-22 03:30
Maternity leave can be financially stressful because you will only receive a percentage of the salary you are used to. A few explanations and a few tricks are in order.
At the time of maternity leave, the salary decreases, yet the expenses increase. For many families, this year spent with a baby marks the beginning of a long period of financial insecurity. Don't worry, this phase is a poor illustration of what really awaits you, but you will still have to adjust and find some ways to save if you want to enjoy it without being too stressed.
A salary cut of 25% to 45%
Regardless of the state of your finances, it is likely that the decrease in your income will affect you. We have made a simulation to give you an idea of the adjustments you will have to make by taking the 50 weeks to which you are en titled.
A working mother who normally receives a gross salary of $673 per week will receive $471.10 for 25 weeks, then $370.15 for the remainder of her maternity leave. This reduction in salary from $200 to $300 per week will necessarily have an impact on the family budget! Also, this amount istaxable, so it is added to the income already earned in the year. Many mothers will tell you that it is safer to set aside a little money each month to prepare for the taxes that will inevitably be asked of you by both levels of government.
Add to this the new expenses that will be on the program, including furniture, diapers, clothes, milk (if you are not breastfeeding), wipes, cereals, pacifiers, accessories and gadgets, and you will find that your finances will take a serious hit. To avoid these changes taking you by surprise, start by visiting Quebec Parental Insurance Plan (QPIP) simulator to perform the calculation that will confirm how much you will receive per week.
Save while there's still time
Now that you are aware of what awaits you and if your pregnancy is not over yet, you can take the opportunity to tighten your belt a little now to put some money aside. Without saving the entire $200 that will be missing, maybe you can set aside a hundred dollars a week? That way, you'll get into the habit of spending more sensibly before you run out of options, and you'll be able to maintain that lifestyle for longer.
If you have several months of preparation within your reach before giving birth, open a TFSA in which you will make an automatic transfer. If you don't have the bump offigures, consider meeting with a financial advisor who will work with you to determine the amount you should set aside to maintain your lifestyle. When your baby arrives, this cushion will be welcome and will allow you to enjoy those precious days without work.
Change the pace of life
If it's too late to save for that one-year leave, the shock will be more pronounced. Start by creating a budget by listing all new household expenses. Will you have to buy furniture? Will you have to buy everything or will you be able to salvage a certain number of things because you already have other children or family to provide for you?
This is also a good time to accept donations from your loved ones. When we have our first child, we sometimes hesitate out of pride or fear of the judgment of others to use used objects and clothes, but you will have so many expenses in the next few years that you can wholeheartedly accept all the gifts you 'we make you! You will see that over time, the big bags of clothes that are brought to us will become more and more rare and you will miss those big gifts that have made you so much save.
Expenses that no longer exist
On a more positive note, it should also be noted that certain expenses are reduced during maternity leave. We go out less and we no longer need to pay for travel, dinners and other work-related expenses. fatigue andOur child's young age also means that going out to restaurants and the cinema is rarer, and this is what will give your wallet a first helping hand. Remember to factor in these savings when calculating your budget.
