An image of a woman hugging a child.
For first-time foster parents, the experience of fostering can be exciting but nerve-wracking. Planning home visits and getting licensed is a necessary but time-consuming process, and soon-to-be parents need to be prepared—physically, emotionally, and financially.
Each state pays foster parents a certain amount for a child, but that is often only enough to cover the very basic needs. The amount itself varies based on the state, the child’s age, and their needs. However, if you’re thinking that fostering may be a lucrative way to make money, that couldn’t be further from the truth. In fact, new foster parents are required to provide proof that they can support a child without accounting for the state payments. And most foster parents report spending much more than the state allowance on the children.
For first-time foster parents, financial planning is key to ensuring their foster children are safe and happy. Ahead, seasoned foster parents share their tips and suggestions that worked for them.
Budget, budget, and budget again.
Making a budget and sticking to it will be essential. To get a good estimate of your earnings and estimates, create a meticulous list of all income sources, along with all fixed and varying expenses per month. Based on the amount left over, you will know whether that is enough to support another child. If not, you will have to make some lifestyle adjustments.
Every item you previously considered a “need” may have to be reconsidered according to your new budget. For example, you may want to go from having Netflix, Amazon Prime, and Hulu to having just one of them and canceling any subscriptions that you rarely or never use.
Dave Hancock, 35, a foster parent from Indiana who has fostered 16 children with his wife over the past 10 years, says that “planning ahead is huge. You quickly learn where to spot bargains at places like yard sales, Goodwill, and department stores. Local foster closets (places where donations of clothes, bedding, furniture, etc. are given to help foster families) are a tremendous blessing.” He adds that “budgeting is also a life skill you’ll quickly learn, if you don’t have that attribute already. Coupons and buying in bulk are your friend.”
Set up an emergency fund.
As a foster parent, you need to plan for the unexpected. While the state will cover medical costs and provide insurance, it does not account for car breakdowns, work hours lost, or the cost of braces, for example. To avoid dipping into your …….