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Dollar Signs: How To Plan Financially For A Baby

Aired July 31, 2004 - 16:30   ET

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.


FREDRICKA WHITFIELD, CNN ANCHOR, DOLLAR SIGNS: Well, welcome to DOLLAR SIGNS. There are plenty of books and parents out there who will give you advice about what to expect when you're expecting. But do you know how to plan financially for having a baby? The average cost of having one is $6,200. That includes buying the crib, the mattress, the clothes, clothes for the pregnancy, and clothes for the baby; baby food, disposable diapers, strollers, car seats, and the carrier.
Boy, there's a whole lot of stuff. Well, that information from the book "Baby Bargains" -- Denise Fields coauthored it with her husband, and she joins us from Denver today.

DENISE FIELDS, COAUTHOR, "BABY BARGAINS": Hi.

WHITFIELD: Good to see you, Denise. And Todd Mark of Consumer Credit Counseling Services is with me here in the studio. Congratulations to you. You're the inspiration for this segment, now that you are a new father again to your baby boy, Joshua.

TODD MARK, CONSUMER CREDIT COUNSELING SERVICES: Yeah, he was born 11 days ago here in Conason (ph) Hospital in Atlanta.

WHITFIELD: Wow, congratulations.

MARK: Thank you.

WHITFIELD: All right, so you know firsthand, as does Denise and her husband, firsthand the expenses that go with having a baby. And these expenses really do begin before the baby is born, isn't that right, Todd?

MARK: Well, there are so many expenses, and it's easy to think, "Well, I do need the crib and the changing table... I'll need diapers and clothes and toys." But then, think about all the other things.

WHITFIELD: Oh, look, and there's Joshua.

MARK: Oh, my little guy. Josh, oh... oh, you guys are milking me.

WHITFIELD: Oh, congratulations.

MARK: Thank you. And my little daughter who's here at CNN today.

WHITFIELD: Katie, right? MARK: Yeah.

WHITFIELD: Yeah.

MARK: She had fun in the makeup room, let me tell you.

WHITFIELD: Oh, good.

MARK: But with a baby, there's so many more things other than those necessities. You think about life insurance. If you haven't had dependents before, maybe you don't have it. Well, guess what? Now you're going to need it.

WHITFIELD: Oh, my gosh.

MARK: How about health insurance for a little one? Adding one extra person, when it's not just you and a spouse, but you add a family, it can go up dramatically. Guess what? It's not too early to start saving for college.

WHITFIELD: Really?

MARK: Oh, yeah. And then there's things that aren't too fun to do like making a will and a directory of what happens to your child if, god forbid, something happens to you.

WHITFIELD: Wow. Denise, it's also very overwhelming, isn't it? I mean, I think a lot of new parents, or expectant parents, have no idea the kinds of expenses that go into starting a family.

FIELDS: You know, it is really expensive. And it's a shock, I think, to parents because they're thinking, "Well, yeah, you know, we'll get lots of gifts and lots of this, that, and the other." But you do have to start saving for college now, and you have to plan for if you want to put your child in daycare. Sometimes, that can be really expensive. So there's a lot of issues not just with the equipment.

WHITFIELD: Well, that leads us perfectly to our first email from Meeta in River Forest, Illinois, who asks, "I'm pregnant for the first time, and I was wondering, when is a good time to start saving for college, and possibly a trust fund?" So you don't have to wait until the baby is born, Denise, is that what you're saying?

FIELDS: Absolutely not. I think when you are certain your baby is coming, I think it's time to start thinking about how you're going to save, what kind of funds you're going to put money into and how much you're going to save every year. It's a good idea to work with a financial planner who can give you some facts and figures about how much college may cost in 18 years.

WHITFIELD: All right, Andrea in California is on the line with us. And congratulations to you, Andrea. I understand you're either expecting or you've got multiples, right?

CALLER: We have twins, yes. WHITFIELD: OK, what's your question?

CALLER: I want to know if there are certain companies or department stores that give discounts for multiple births.

FIELDS: That's a great question. You know, parents of multiples have -- the numbers of parents with multiples have increased over the years. There are a lot more of them today. And yes, you can go to stores, even like Babies R Us and Target, a lot of mom and pop baby equipment stores who will offer you discounts on buying multiple outfits, multiple cribs, that kind of thing. Yeah, so definitely ask, because they often don't post that information.

MARK: And you know, when I was going online looking for things, just in the case of twins, I did see that they say, "If you've got twins, or triplets, or more, you buy the first one, and we're going to match you or double or triple you."

WHITFIELD: Wow.

MARK: Because they want to earn your business. And it's a great gimmick to say, "Wow, they appreciate me. I'm going to buy everything there."

WHITFIELD: Wow. And Denise, besides your book, "Baby Bargains," there are a lot of resources out there, particularly on the Internet as well. And from Wisconsin, our caller has a question about the Internet and the best use of. What's your question?

CALLER: Well, my wife and I, we are professionals, and we like to think that we have thought of everything. But goodness knows, there's probably some things that have slipped through the cracks. So is there a good Web site or a good book that we could look at that would help us zero in on anything that we might have missed?

FIELDS: Well, I have to throw in a plug for our book. You know, we cover baby products from cribs to strollers, high chairs, you know, just about anything and everything you can use. But you know, certainly, I think you can find a lot of information online. For example, our Web site at BabyBargainsBook.com has message boards that have a lot of feedback from parents.

And you can ask experienced parents questions about products. It's amazing how much information you can find out just from sharing some of that information. And there are other Web sites that also have message boards.

WHITFIELD: And Todd, maybe -- and that's a great idea, and that can really help you finding out some information from other experienced parents about -- what do I do about medical insurance, what do I do about, you know, life insurance?

MARK: Sure. Anything that you have a question about when it comes to babies and budgeting, there's information on the Web. I did a search for a calculator to figure out -- does it pay for me to stay at home with a baby, or should I go into the workforce and stay a dual income family? So there's calculators where you can plug in how much you're making, how much the cost of daycare or childcare is going to be in the state that you live.

And they'll tell you, "Well, gee, after taxes, and food, and transportation, and all that, you're earning two dollars an hour or four dollars an hour." And you can then decide, gee, this is the true fruits of my labor? Is it worth it, or should I stay at home? There's plenty of great budgeting sites as well. I did a basic search and came up on BabyCenter.com and Parents.com.

Just type in "baby" and whatever your topic is and you're going to find loads of information.

WHITFIELD: Wow. We're going to go over some more of those expenses, things to anticipate when you try to allow your family to grow. We're going to be right back after this. Send your emails to DollarSigns@CNN.com, or you can call us at 1-800-807-2620. We'll be right back.

(COMMERCIAL BREAK)

WHITFIELD: Well, welcome back to DOLLAR SIGNS. Here's something else to consider when you're thinking about having a family. Under the federal Family and Medical Leave Act, you won't get paid when you take time off, but if you live in California, it's a different story. Here's our Donna Tetreault.

(BEGIN VIDEOTAPE)

DONNA TETREAULT, CNN, LOS ANGELES (voice-over): Marci Arnonvitz is spending lots of time with her two-month-old baby girl Ruby, all thanks to California's family leave law, now in effect.

MARCIE ARNONVITZ, NEW MOM: Just being able to be there when she smiles and being able to be there when she cries, and watching her change over the few months and establishing a relationship is amazing.

TETREAULT (on-camera): The California law differs from the national Family and Medical Leave Act because most workers can take up to six weeks off and get at least half of their pay. The federal act is unpaid.

(voice-over): Actor and director Rob Reiner has given the law a high profile boost.

ROB REINER, ACTOR, DIRECTOR: We know, based on all the scientific research, that the earliest years of a child's life are critical, and the bonding that a parent does with a child actually affects brain development.

TETREAULT: Harold Igdaloff is a small business owner and believes the new law is good for families, but he says companies like his are going to be hit hard.

HAROLD IGDALOFF, SMALL BUSINESS OWNER: A smaller workforce and people are gone, then you have to either make up the time with overtime or you have to replace the employees temporarily. And then, if you replace them temporarily, then you have a double hit.

TETREAULT: But for new moms like Marci, this law is the answer to her prayers.

ARNONVITZ: It's a wonderful feeling to know that I can lay the groundwork of creating a loving relationship with the baby.

TETREAULT: To date, 8,400 parents have filed claims and now look forward to bonding with their babies. Donna Tetreault for CNN Los Angeles.

(END VIDEOTAPE)

WHITFIELD: Well, aside from winning the lottery, what are some of the things you need to do financially to be able to handle a baby? We're asking these kinds of questions to Todd Mark, Consumer Credit Counseling Service, and Denise Fields, coauthor of "Baby Bargains."

All right, you guys, Bea from California has a question about really trying to weed through -- from Florida, sorry -- trying to weed through all the options out there. You don't want to latch onto everything. Bea...

ON THE PHONE, BEA FROM FLORIDA: Yes, with so many products and services being marketed to expectant parents, which of those do you suggest one can do without?

FIELDS: Oh, the list is so long. We could be here all day. One thing that we always try to recommend to parents is that you try to take an experienced mom to the store with you before you make your buying decisions, because they can often help you weed out the junk. They've been through it already and they know what to look for.

There are two things you must have when you bring your baby home. You must have a car seat, because you can't leave the hospital without it, and you must have a place for a baby, and that's typically a crib. Those are the only two things that are an absolute requirement.

MARK: I disagree, Denise. I think a diaper genie is essential, or your house is going to smell.

FIELDS: That's true. There are a couple of those side things that are nice to have.

MARK: Now, I'll tell you a great thing you can save on I love -- is not buying baby food coming out... formula.

WHITFIELD: Oh...

MARK: I'm not anti-formula. But you know, think about...

WHITFIELD: Doing the breast-feeding thing...

MARK: I'm talking about nursing. And you know, there's all these great health benefits, but I'm not here to plug those today. Just from a financial standpoint, think about now having to buy formula for six months, nine months, twelve months. It's a great savings. And for dads, it's an extra benefit, because guess what?

WHITFIELD: What?

MARK: I can't help out with nursing in the middle of the night. So...

WHITFIELD: OK, I was like, where are we going with this one?

MARK: No, no. But seriously, it is World Breast Feeding Week. And if people are interested about that, they can do a search online for World Breast Feeding Week, and there's tips. They can explain all the health benefits and the financial benefits.

FIELDS: Yes, you can save about $500 in the first year if you don't use formula.

WHITFIELD: Wow, that's a big difference. All right, Ina in Texas is on bed rest, but she has a question about unemployment benefits. Ina...

CALLER: Hi. My family leave, the 12 weeks will be up shortly. And my question is, I'll be without a job at that point. Can I qualify or apply for unemployment and receive unemployment?

WHITFIELD: Todd...

MARK: Well, are you keeping your job?

CALLER: Well, according to HR, they mentioned after the 12 weeks, if I cannot report back to work, which, unfortunately, I'll be having the baby at the end of the 12 weeks, so probably I will not be able to go back to work after the 12 weeks. So they mentioned my job would be terminated.

MARK: Wow.

CALLER: So I'm kind of looking at my options. Are there any state benefits like unemployment that I could apply for to help me out financially until I'm able to go back to work?

MARK: Well, sure. If your job is officially terminated, you're eligible for unemployment. My question would be, instead of having to terminate from the job, do you have any short term or long term disability insurance that would cover your longer than 12-week period of being out?

CALLER: No, from what I understand with my HR, short term is combined with my family leave period. In order for me to apply for long term, which is after the 12 weeks, I would have to terminate my position, and then I could apply for long term.

MARK: Wow.

WHITFIELD: Whoa, that is severe.

MARK: And you know what's interesting, is if this is how your job is treating you through your delivery -- and I'm sorry that you're stuck on bed rest -- but that would probably make you question whether you want to go back there after you're able to go back to work, wouldn't you think?

CALLER: True.

WHITFIELD: Boy, that's a lot to consider. That is quite a bind. All right, we're going to take more questions, more of your email questions and your phone call questions right after this short break. And we'll be right back.

(COMMERCIAL BREAK)

WHITFIELD: We're talking about baby makes three, how do you keep up with the expenses, how do you prepare in your family's planning -- all the things to think about. Todd Mark of Consumer Credit Counseling Service and Denise Fields, coauthor of "Baby Bargains." They are both helping us sort through the many, many options out there. It really is quite confusing and complex out there.

Jesus of Washington is on the telephone, and Jesus has a question for you, Denise.

FIELDS: OK.

CALLER: Hi, Denise, how are you?

FIELDS: I'm fine, thanks.

CALLER: OK, great. I've heard that the baby products industry is very generous with coupons, and I wanted to first ask you if you have any information about getting those coupons through your book or if you know of any other sources where people can go and get the coupons without necessarily having to call up everybody under the sun directly.

FIELDS: The good news is you can go online and sign up for all kinds of things. Formula feed, you can sign up for coupons for that, for diapers. I think Fisher Price has some couponing, and most of it you can do on their Web site. So it's very easy now. You don't have to call around. And if you register for gifts at a baby store, a lot of times you'll get on a mailing list and get those coupons as well.

WHITFIELD: And to both of you, there are consignment shops out there as well, and sometimes you can get some bargains. But I understand there are some real red flags, Todd, certain things you really don't want to buy at a consignment store. What are they?

MARK: Sure, well, Fredricka, we have gotten plenty of clothes from consignment stores. You know, hand-me-downs, a t-shirt is going to be just as good next year as it is this year as it was last year. But say something like a crib, it might be five years old, it might be 20 years old, and you don't know if the safety standards have changed over the past years.

You know, the Consumer Products Safety Commission is always saying, "Well, this is the latest and greatest needs to protect your baby." So I don't know about getting a used crib. And specifically, you don't know -- maybe the wood or the plastic is warped. That's something you wouldn't want to put your baby in.

WHITFIELD: And Denise, I guess the same would apply for car seats as well.

FIELDS: That's right. You never know if a car seat has actually been in an accident before, and there can be some damage to it internally that you may not notice or see. So a crib and a car seat, those are two things that you should probably try to buy brand new.

WHITFIELD: OK, from Dallas, Kwabena writes, "We're expecting a baby in November. We've been buying U.S. Treasury series one bonds for his college education. Is this a good investment?" Todd...

MARK: Gee, Kwabena, well, congratulations on your new baby. And I think we're going to be talking about college savings next week on the program. But there's something very, very good for everybody. If they don't know about it, it's called a 529 college savings plan. You put dollars in this year and you let it grow, and grow, and grow, and...

WHITFIELD: But that's once the baby's born, right, the 529?

MARK: Yes, but if the baby's coming in November, she can start putting her money aside now, open up the account once the baby is born. And it works much like a Roth IRA in that you put the money in, it's going to grow tax-free. You take it out tax-free.

WHITFIELD: Wow.

MARK: So that's just a no-brainer. You do want to search around. Each state has different plans, and they're run by different companies with different management styles and fees. So you want to go to one of the two main Web sites, SavingforCollege.com or CollegeSavings.org.

WHITFIELD: Wow. And something you learned firsthand, Todd, about medical insurance, life insurance, with your new baby, Joshua, that it's not so easy as just going to your employer and expanding your medical insurance. Sometimes, you want to shop around.

MARK: Well, absolutely. And you know, many times, an insurance carrier, when they're providing family coverage, they're just assuming that you're going to have families -- the workforce that has one child, some are going to have seven kids or five kids, and they're going to have one rate for all families.

Well, when we had Katie four years ago, it didn't really pay for us, because in our case, insurance was going to go up from $260 for my wife and I to $520 just to add Katie. So instead, we went shopping around, got an individual policy for my daughter independently, an additional $70 a month. So we saved nearly $200.

Well, Joshua came along, and again, we got him a coverage of $70 a month. So we're still saving about $100 a month not going with the default one through work.

WHITFIELD: All right, Denise, and we've given folks so many options, so much to think about. I'm sure everyone's overwhelmed now. If we can just now kind of wrap it all up with -- if you're just getting started, what is the first purchase, perhaps, you recommend that someone needs to make when trying to make one of their first investments as the baby's on the way?

FIELDS: I think that's a good question. I think you'd probably want to shop around and find a place for your baby to sleep -- whether that's a cradle or a crib or a bassinet. I think having a nice, safe piece of furniture for your child that you can depend on is probably the best thing. Because you know, babies sleep those first few months. I know Todd's isn't sleeping yet...

MARK: Not yet.

FIELDS: ...but you know, they will, or they sleep when you're awake is how it usually works. But they do sleep most of the time, so having a safe place for your baby to sleep is probably the number one most important thing.

WHITFIELD: All right. And new dad, then, what would be your big recommendation?

MARK: Well, besides buying Denise's book, which was absolutely fabulous for us four years ago...

FIELDS: Thank you.

MARK: ... Denise, you know that. But seriously, what I would say to do is go create a budget, figure out what you're going to be spending up front on all the furniture. Are you going to have help from mom and dad? Figure out these insurance costs, college savings. Figure out what it's going to take and whether or not you can have somebody stay at home, or if you need childcare, what you're going to do.

WHITFIELD: Wow. All right, Todd Mark of Consumer Credit Counseling Services and Denise Fields, coauthor of "Baby Bargains" -- you just saw the cover of the book a moment ago -- thanks to both of you for joining us. We appreciate it. And hopefully, we've given a lot of new parents, or parents to be out there, some ideas and some ways to figure out how to cut costs, if at all possible.

All right, thanks a lot. And that's all we have time for right now. I'll be back after a quick break with today's top stories.

(COMMERCIAL BREAK)

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Aired July 31, 2004 - 16:30   ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
FREDRICKA WHITFIELD, CNN ANCHOR, DOLLAR SIGNS: Well, welcome to DOLLAR SIGNS. There are plenty of books and parents out there who will give you advice about what to expect when you're expecting. But do you know how to plan financially for having a baby? The average cost of having one is $6,200. That includes buying the crib, the mattress, the clothes, clothes for the pregnancy, and clothes for the baby; baby food, disposable diapers, strollers, car seats, and the carrier.
Boy, there's a whole lot of stuff. Well, that information from the book "Baby Bargains" -- Denise Fields coauthored it with her husband, and she joins us from Denver today.

DENISE FIELDS, COAUTHOR, "BABY BARGAINS": Hi.

WHITFIELD: Good to see you, Denise. And Todd Mark of Consumer Credit Counseling Services is with me here in the studio. Congratulations to you. You're the inspiration for this segment, now that you are a new father again to your baby boy, Joshua.

TODD MARK, CONSUMER CREDIT COUNSELING SERVICES: Yeah, he was born 11 days ago here in Conason (ph) Hospital in Atlanta.

WHITFIELD: Wow, congratulations.

MARK: Thank you.

WHITFIELD: All right, so you know firsthand, as does Denise and her husband, firsthand the expenses that go with having a baby. And these expenses really do begin before the baby is born, isn't that right, Todd?

MARK: Well, there are so many expenses, and it's easy to think, "Well, I do need the crib and the changing table... I'll need diapers and clothes and toys." But then, think about all the other things.

WHITFIELD: Oh, look, and there's Joshua.

MARK: Oh, my little guy. Josh, oh... oh, you guys are milking me.

WHITFIELD: Oh, congratulations.

MARK: Thank you. And my little daughter who's here at CNN today.

WHITFIELD: Katie, right? MARK: Yeah.

WHITFIELD: Yeah.

MARK: She had fun in the makeup room, let me tell you.

WHITFIELD: Oh, good.

MARK: But with a baby, there's so many more things other than those necessities. You think about life insurance. If you haven't had dependents before, maybe you don't have it. Well, guess what? Now you're going to need it.

WHITFIELD: Oh, my gosh.

MARK: How about health insurance for a little one? Adding one extra person, when it's not just you and a spouse, but you add a family, it can go up dramatically. Guess what? It's not too early to start saving for college.

WHITFIELD: Really?

MARK: Oh, yeah. And then there's things that aren't too fun to do like making a will and a directory of what happens to your child if, god forbid, something happens to you.

WHITFIELD: Wow. Denise, it's also very overwhelming, isn't it? I mean, I think a lot of new parents, or expectant parents, have no idea the kinds of expenses that go into starting a family.

FIELDS: You know, it is really expensive. And it's a shock, I think, to parents because they're thinking, "Well, yeah, you know, we'll get lots of gifts and lots of this, that, and the other." But you do have to start saving for college now, and you have to plan for if you want to put your child in daycare. Sometimes, that can be really expensive. So there's a lot of issues not just with the equipment.

WHITFIELD: Well, that leads us perfectly to our first email from Meeta in River Forest, Illinois, who asks, "I'm pregnant for the first time, and I was wondering, when is a good time to start saving for college, and possibly a trust fund?" So you don't have to wait until the baby is born, Denise, is that what you're saying?

FIELDS: Absolutely not. I think when you are certain your baby is coming, I think it's time to start thinking about how you're going to save, what kind of funds you're going to put money into and how much you're going to save every year. It's a good idea to work with a financial planner who can give you some facts and figures about how much college may cost in 18 years.

WHITFIELD: All right, Andrea in California is on the line with us. And congratulations to you, Andrea. I understand you're either expecting or you've got multiples, right?

CALLER: We have twins, yes. WHITFIELD: OK, what's your question?

CALLER: I want to know if there are certain companies or department stores that give discounts for multiple births.

FIELDS: That's a great question. You know, parents of multiples have -- the numbers of parents with multiples have increased over the years. There are a lot more of them today. And yes, you can go to stores, even like Babies R Us and Target, a lot of mom and pop baby equipment stores who will offer you discounts on buying multiple outfits, multiple cribs, that kind of thing. Yeah, so definitely ask, because they often don't post that information.

MARK: And you know, when I was going online looking for things, just in the case of twins, I did see that they say, "If you've got twins, or triplets, or more, you buy the first one, and we're going to match you or double or triple you."

WHITFIELD: Wow.

MARK: Because they want to earn your business. And it's a great gimmick to say, "Wow, they appreciate me. I'm going to buy everything there."

WHITFIELD: Wow. And Denise, besides your book, "Baby Bargains," there are a lot of resources out there, particularly on the Internet as well. And from Wisconsin, our caller has a question about the Internet and the best use of. What's your question?

CALLER: Well, my wife and I, we are professionals, and we like to think that we have thought of everything. But goodness knows, there's probably some things that have slipped through the cracks. So is there a good Web site or a good book that we could look at that would help us zero in on anything that we might have missed?

FIELDS: Well, I have to throw in a plug for our book. You know, we cover baby products from cribs to strollers, high chairs, you know, just about anything and everything you can use. But you know, certainly, I think you can find a lot of information online. For example, our Web site at BabyBargainsBook.com has message boards that have a lot of feedback from parents.

And you can ask experienced parents questions about products. It's amazing how much information you can find out just from sharing some of that information. And there are other Web sites that also have message boards.

WHITFIELD: And Todd, maybe -- and that's a great idea, and that can really help you finding out some information from other experienced parents about -- what do I do about medical insurance, what do I do about, you know, life insurance?

MARK: Sure. Anything that you have a question about when it comes to babies and budgeting, there's information on the Web. I did a search for a calculator to figure out -- does it pay for me to stay at home with a baby, or should I go into the workforce and stay a dual income family? So there's calculators where you can plug in how much you're making, how much the cost of daycare or childcare is going to be in the state that you live.

And they'll tell you, "Well, gee, after taxes, and food, and transportation, and all that, you're earning two dollars an hour or four dollars an hour." And you can then decide, gee, this is the true fruits of my labor? Is it worth it, or should I stay at home? There's plenty of great budgeting sites as well. I did a basic search and came up on BabyCenter.com and Parents.com.

Just type in "baby" and whatever your topic is and you're going to find loads of information.

WHITFIELD: Wow. We're going to go over some more of those expenses, things to anticipate when you try to allow your family to grow. We're going to be right back after this. Send your emails to DollarSigns@CNN.com, or you can call us at 1-800-807-2620. We'll be right back.

(COMMERCIAL BREAK)

WHITFIELD: Well, welcome back to DOLLAR SIGNS. Here's something else to consider when you're thinking about having a family. Under the federal Family and Medical Leave Act, you won't get paid when you take time off, but if you live in California, it's a different story. Here's our Donna Tetreault.

(BEGIN VIDEOTAPE)

DONNA TETREAULT, CNN, LOS ANGELES (voice-over): Marci Arnonvitz is spending lots of time with her two-month-old baby girl Ruby, all thanks to California's family leave law, now in effect.

MARCIE ARNONVITZ, NEW MOM: Just being able to be there when she smiles and being able to be there when she cries, and watching her change over the few months and establishing a relationship is amazing.

TETREAULT (on-camera): The California law differs from the national Family and Medical Leave Act because most workers can take up to six weeks off and get at least half of their pay. The federal act is unpaid.

(voice-over): Actor and director Rob Reiner has given the law a high profile boost.

ROB REINER, ACTOR, DIRECTOR: We know, based on all the scientific research, that the earliest years of a child's life are critical, and the bonding that a parent does with a child actually affects brain development.

TETREAULT: Harold Igdaloff is a small business owner and believes the new law is good for families, but he says companies like his are going to be hit hard.

HAROLD IGDALOFF, SMALL BUSINESS OWNER: A smaller workforce and people are gone, then you have to either make up the time with overtime or you have to replace the employees temporarily. And then, if you replace them temporarily, then you have a double hit.

TETREAULT: But for new moms like Marci, this law is the answer to her prayers.

ARNONVITZ: It's a wonderful feeling to know that I can lay the groundwork of creating a loving relationship with the baby.

TETREAULT: To date, 8,400 parents have filed claims and now look forward to bonding with their babies. Donna Tetreault for CNN Los Angeles.

(END VIDEOTAPE)

WHITFIELD: Well, aside from winning the lottery, what are some of the things you need to do financially to be able to handle a baby? We're asking these kinds of questions to Todd Mark, Consumer Credit Counseling Service, and Denise Fields, coauthor of "Baby Bargains."

All right, you guys, Bea from California has a question about really trying to weed through -- from Florida, sorry -- trying to weed through all the options out there. You don't want to latch onto everything. Bea...

ON THE PHONE, BEA FROM FLORIDA: Yes, with so many products and services being marketed to expectant parents, which of those do you suggest one can do without?

FIELDS: Oh, the list is so long. We could be here all day. One thing that we always try to recommend to parents is that you try to take an experienced mom to the store with you before you make your buying decisions, because they can often help you weed out the junk. They've been through it already and they know what to look for.

There are two things you must have when you bring your baby home. You must have a car seat, because you can't leave the hospital without it, and you must have a place for a baby, and that's typically a crib. Those are the only two things that are an absolute requirement.

MARK: I disagree, Denise. I think a diaper genie is essential, or your house is going to smell.

FIELDS: That's true. There are a couple of those side things that are nice to have.

MARK: Now, I'll tell you a great thing you can save on I love -- is not buying baby food coming out... formula.

WHITFIELD: Oh...

MARK: I'm not anti-formula. But you know, think about...

WHITFIELD: Doing the breast-feeding thing...

MARK: I'm talking about nursing. And you know, there's all these great health benefits, but I'm not here to plug those today. Just from a financial standpoint, think about now having to buy formula for six months, nine months, twelve months. It's a great savings. And for dads, it's an extra benefit, because guess what?

WHITFIELD: What?

MARK: I can't help out with nursing in the middle of the night. So...

WHITFIELD: OK, I was like, where are we going with this one?

MARK: No, no. But seriously, it is World Breast Feeding Week. And if people are interested about that, they can do a search online for World Breast Feeding Week, and there's tips. They can explain all the health benefits and the financial benefits.

FIELDS: Yes, you can save about $500 in the first year if you don't use formula.

WHITFIELD: Wow, that's a big difference. All right, Ina in Texas is on bed rest, but she has a question about unemployment benefits. Ina...

CALLER: Hi. My family leave, the 12 weeks will be up shortly. And my question is, I'll be without a job at that point. Can I qualify or apply for unemployment and receive unemployment?

WHITFIELD: Todd...

MARK: Well, are you keeping your job?

CALLER: Well, according to HR, they mentioned after the 12 weeks, if I cannot report back to work, which, unfortunately, I'll be having the baby at the end of the 12 weeks, so probably I will not be able to go back to work after the 12 weeks. So they mentioned my job would be terminated.

MARK: Wow.

CALLER: So I'm kind of looking at my options. Are there any state benefits like unemployment that I could apply for to help me out financially until I'm able to go back to work?

MARK: Well, sure. If your job is officially terminated, you're eligible for unemployment. My question would be, instead of having to terminate from the job, do you have any short term or long term disability insurance that would cover your longer than 12-week period of being out?

CALLER: No, from what I understand with my HR, short term is combined with my family leave period. In order for me to apply for long term, which is after the 12 weeks, I would have to terminate my position, and then I could apply for long term.

MARK: Wow.

WHITFIELD: Whoa, that is severe.

MARK: And you know what's interesting, is if this is how your job is treating you through your delivery -- and I'm sorry that you're stuck on bed rest -- but that would probably make you question whether you want to go back there after you're able to go back to work, wouldn't you think?

CALLER: True.

WHITFIELD: Boy, that's a lot to consider. That is quite a bind. All right, we're going to take more questions, more of your email questions and your phone call questions right after this short break. And we'll be right back.

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WHITFIELD: We're talking about baby makes three, how do you keep up with the expenses, how do you prepare in your family's planning -- all the things to think about. Todd Mark of Consumer Credit Counseling Service and Denise Fields, coauthor of "Baby Bargains." They are both helping us sort through the many, many options out there. It really is quite confusing and complex out there.

Jesus of Washington is on the telephone, and Jesus has a question for you, Denise.

FIELDS: OK.

CALLER: Hi, Denise, how are you?

FIELDS: I'm fine, thanks.

CALLER: OK, great. I've heard that the baby products industry is very generous with coupons, and I wanted to first ask you if you have any information about getting those coupons through your book or if you know of any other sources where people can go and get the coupons without necessarily having to call up everybody under the sun directly.

FIELDS: The good news is you can go online and sign up for all kinds of things. Formula feed, you can sign up for coupons for that, for diapers. I think Fisher Price has some couponing, and most of it you can do on their Web site. So it's very easy now. You don't have to call around. And if you register for gifts at a baby store, a lot of times you'll get on a mailing list and get those coupons as well.

WHITFIELD: And to both of you, there are consignment shops out there as well, and sometimes you can get some bargains. But I understand there are some real red flags, Todd, certain things you really don't want to buy at a consignment store. What are they?

MARK: Sure, well, Fredricka, we have gotten plenty of clothes from consignment stores. You know, hand-me-downs, a t-shirt is going to be just as good next year as it is this year as it was last year. But say something like a crib, it might be five years old, it might be 20 years old, and you don't know if the safety standards have changed over the past years.

You know, the Consumer Products Safety Commission is always saying, "Well, this is the latest and greatest needs to protect your baby." So I don't know about getting a used crib. And specifically, you don't know -- maybe the wood or the plastic is warped. That's something you wouldn't want to put your baby in.

WHITFIELD: And Denise, I guess the same would apply for car seats as well.

FIELDS: That's right. You never know if a car seat has actually been in an accident before, and there can be some damage to it internally that you may not notice or see. So a crib and a car seat, those are two things that you should probably try to buy brand new.

WHITFIELD: OK, from Dallas, Kwabena writes, "We're expecting a baby in November. We've been buying U.S. Treasury series one bonds for his college education. Is this a good investment?" Todd...

MARK: Gee, Kwabena, well, congratulations on your new baby. And I think we're going to be talking about college savings next week on the program. But there's something very, very good for everybody. If they don't know about it, it's called a 529 college savings plan. You put dollars in this year and you let it grow, and grow, and grow, and...

WHITFIELD: But that's once the baby's born, right, the 529?

MARK: Yes, but if the baby's coming in November, she can start putting her money aside now, open up the account once the baby is born. And it works much like a Roth IRA in that you put the money in, it's going to grow tax-free. You take it out tax-free.

WHITFIELD: Wow.

MARK: So that's just a no-brainer. You do want to search around. Each state has different plans, and they're run by different companies with different management styles and fees. So you want to go to one of the two main Web sites, SavingforCollege.com or CollegeSavings.org.

WHITFIELD: Wow. And something you learned firsthand, Todd, about medical insurance, life insurance, with your new baby, Joshua, that it's not so easy as just going to your employer and expanding your medical insurance. Sometimes, you want to shop around.

MARK: Well, absolutely. And you know, many times, an insurance carrier, when they're providing family coverage, they're just assuming that you're going to have families -- the workforce that has one child, some are going to have seven kids or five kids, and they're going to have one rate for all families.

Well, when we had Katie four years ago, it didn't really pay for us, because in our case, insurance was going to go up from $260 for my wife and I to $520 just to add Katie. So instead, we went shopping around, got an individual policy for my daughter independently, an additional $70 a month. So we saved nearly $200.

Well, Joshua came along, and again, we got him a coverage of $70 a month. So we're still saving about $100 a month not going with the default one through work.

WHITFIELD: All right, Denise, and we've given folks so many options, so much to think about. I'm sure everyone's overwhelmed now. If we can just now kind of wrap it all up with -- if you're just getting started, what is the first purchase, perhaps, you recommend that someone needs to make when trying to make one of their first investments as the baby's on the way?

FIELDS: I think that's a good question. I think you'd probably want to shop around and find a place for your baby to sleep -- whether that's a cradle or a crib or a bassinet. I think having a nice, safe piece of furniture for your child that you can depend on is probably the best thing. Because you know, babies sleep those first few months. I know Todd's isn't sleeping yet...

MARK: Not yet.

FIELDS: ...but you know, they will, or they sleep when you're awake is how it usually works. But they do sleep most of the time, so having a safe place for your baby to sleep is probably the number one most important thing.

WHITFIELD: All right. And new dad, then, what would be your big recommendation?

MARK: Well, besides buying Denise's book, which was absolutely fabulous for us four years ago...

FIELDS: Thank you.

MARK: ... Denise, you know that. But seriously, what I would say to do is go create a budget, figure out what you're going to be spending up front on all the furniture. Are you going to have help from mom and dad? Figure out these insurance costs, college savings. Figure out what it's going to take and whether or not you can have somebody stay at home, or if you need childcare, what you're going to do.

WHITFIELD: Wow. All right, Todd Mark of Consumer Credit Counseling Services and Denise Fields, coauthor of "Baby Bargains" -- you just saw the cover of the book a moment ago -- thanks to both of you for joining us. We appreciate it. And hopefully, we've given a lot of new parents, or parents to be out there, some ideas and some ways to figure out how to cut costs, if at all possible.

All right, thanks a lot. And that's all we have time for right now. I'll be back after a quick break with today's top stories.

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