Expecting a baby? Avoid these four common money mistakes.

New parents want everything to be perfect, but at a time of such emotion, the opportunities for money mistakes are ever present.

Sanford Myers/AP Images for Kmart/File
New mom Karla White poses with her baby Henry for a KMart press shoot in 2015.

There's nothing like the excitement of a child being born. Parents want everything to be perfect for their precious bundle of joy. But at a time of such emotion, the opportunities for money mistakes are ever present.

Here are four common financial pitfalls to avoid when you're expecting a baby, and what to do instead.

Overbuying Baby Gear and Gadgets

There are endless gadgets and gizmos that baby brands and stores want you to think you need. Parents-to-be tend to overbuy, spending too much on baby products.

"Be mindful that many of these gadgets are only used for a short period of time," says Andrea Woroch, a consumer and money-saving expert. "Mom and dad should ask friends and family who recently had children if they can borrow goods like swings, carriers, and strollers."

Buying Needlessly Expensive Stuff
Push aside any competitive feelings to keep up with the Joneses. "I had a client who wanted the crib to match furniture in the house," says Craig Lemoine, a professor of financial planning at The American College of Financial Services. "She looked online at places like IKEA and Amazon and couldn't find one that was 'just right.' She wound up buying one online from Italy for $4,000."

"Two months later she regretted spending this much," he adds. "And $4,000 growing at 8% over 18 years would have turned into $16,000 for college."

Truth is, some of the best quality items are moderately priced at Target and Babies"R"Us, and can often be found on sale. Babies grow so fast that they won't wear anything for long. "Buy gently used clothes from sites like thredUP.com," Woroch says. "Otherwise, sell your unwanted clothingfor credit toward your future baby clothing for no cost at all."

Buying Too Many Things
Kate Trout, a blogger at Maternity Glow, says the biggest mistake she made with her first child was buying way too much stuff. "Wipe warmers, fancy baby monitors, three kinds of baby bouncer — you name it, I probably bought it," she says. "A newborn doesn't really need that much stuff — a bassinet and crib to sleep in, some warm clothes, a full belly, and mom and dad's love is really all they need."

Not Anticipating a Budget Adjustment

You know that you're going to give up sleeping for some time to come, but there's much more to think about. "Try to estimate what your income and expenses will be after the baby arrives. This can be challenging, but it's important to make sure that you'll be able to make ends meet," says Paul Jacobs, a certified financial planner with Palisades Hudson Financial Group.

Some Expenses Could Actually Go Down
"Child care can be expensive, but there may be other expenses that will drop significantly in the first few years, such as entertainment and travel."

"When budgeting, it's important to consider taxes," he continues. "For example, being able to claim an additional dependent will lower your taxes and may lead to a larger refund."

"Child care can be expensive, but there may be other expenses that will drop significantly in the first few years, such as entertainment and travel."

Be Careful of Spending for Convenience
While takeout food has much appeal for time-strapped, tired parents, it's almost always more expensive than home-cooked meals. "Batch cook and freeze," says Sandra Gordon, author of Save a Bundle: 50+ Ways to Save Big on Baby Gear.

Realize, too, that maternity leave rarely covers your salary at 100%, and that will drop even further if you extend the time off. Some people may not get anything, period, which is why it's crucial to begin preparing for this time by lowering expenses and spending before the baby is born.

Putting College Savings on the Back Burner

Plan for college now. "Think about the pros and cons of a 529 plan, a Coverdell Education Savings Account, or a Uniform Transfer to Minors account, but the sooner you start, the better," says Whitney Lee, associate private CFO at oXYGen Financial.

Don't Neglect Retirement Savings

What you don't want to do is save for your child's education at the expense of your own long-term savings. Your child can always get financial aid, but there is no financial aid for your retirement. This is yet another reason why you will need to buckle down — cut out spending on nonessentials so you'll have the room to meet new expenses and save!

Only Thinking in the Short Term

Right now, you're focused on the BABY, and little else. But tomorrow comes, and you don't know what it will bring. Be prepared for any surprises. Revisit insurance coverage — including life, disability, and health. "Many people focus on life insurance but neglect disability insurance," Jacobs notes. "But young people are more likely to face a temporary disability than premature death."

Draft wills, not necessarily so much to spell out how your assets will be distributed, but to name who will be the guardian of your child in case of premature death. Without a will, a judge decides who would take custody of your child.

Think Long-Term When Shopping, Too
When you're buying "stuff," look for products that will grow with the baby. Convertible items are a great way to extend the life of baby necessities. Cribs that turn into toddler beds, and strollers that transition from newborn to toddler mode grow with your baby. In addition, you'll be ready when baby number two or three comes along, Ryan Bailey of TD Bank says.

This article first appeared in DealNews. 

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