In compliance with Federal Law, the Northwest School District administers all education programs, employment activities and admissions without discrimination against any person on the basis of gender, race, color, religion, national origin, age or disability.
In compliance with Federal Law, the Northwest School District administers all education programs, employment activities and admissions without discrimination against any person on the basis of gender, race, color, religion, national origin, age or disability.
With the excitement of planning for a baby, you may have not given much thought to your maternity leave plan.
Since there is no national policy for paid leave, only 11 percent of workers report compensation during maternity leave. However, 39 percent of workers are reportedly able to make arrangements to get paid for at least some of that time.1
As a result, many new parents return to work only a few weeks after the arrival of a baby because they can’t afford to be without a paycheck for long. This means many mothers (and fathers, too) are forced to deal with the challenges of post-pregnancy, sleep deprivation, and careers—all at once.
The following tips may help you understand your options regarding parental leave and, moreover, fulfill your new family responsibilities while protecting your future financial security.
Check in with HR
The Family and Medical Leave Act of 1993 (FMLA) established a 12-week standard for unpaid leave with a job guarantee. FMLA ensures time off for pregnancy, adoption, prenatal and even foster care, but the law only applies to people who have worked for at least 12 months at companies with more than 50 employees “at the location or within 75 miles of the location.”2
Clearly, there are very specific parameters involved, so it’s important to find out whether your company is subject to the FMLA.
As soon as you are comfortable telling people that you’re planning for a new arrival, set up a time to talk with your company’s human resources department, so you can understand the policy for paid versus unpaid leave.
Your HR department may also be able to help you take advantage of pre-tax benefits. Flexible savings accounts (FSA) and dependent care programs are two benefits that can help you pay for medical expenses and childcare on a pre-tax basis, but you can only sign up for them during certain times of the year.
If you have a high-deductible health plan, you’re eligible for a health savings account (HSA), which could be an advantageous alternative. With a HSA, you can adjust your contribution throughout the year, limits are higher and funds can be rolled over to the next year.3 Consult with your HR department to understand all the options available to you.
Pool your leave
Most often, maternity leave will come from a combination of sick days, vacation and short-term disability (STD). Remember, however, that disability insurance only covers a portion of your salary, not your entire paycheck, so you might experience a salary reduction.
Some companies (and states) may make you use vacation and sick days before tapping into disability benefits. When possible, however, consider leaving a few sick days in reserve in case you or your child becomes ill soon after you return to work.
Save, and save some more
With the new expenses that coincide with this exciting time, budgeting for the new baby should be top of mind whether or not your job provides paid leave.
Figure out how much you’re going to spend each month, especially with regards to healthcare costs (and perhaps pad the budget a bit for additional items like diapers and formula). If your situation allows for it, consider saving before you’re planning for a baby so you can support yourself for a few months, while also protecting yourself for any unforeseen circumstances.
The birth of a child is one of life’s greatest joys, but it can also be one of the most challenging. Prepare now so you can spend those precious first weeks getting to know your baby while helping to secure the financial future of your growing family.
1“The Economics of Paid and Unpaid Leave.” Council of Economic Advisers. June 2014. //www.whitehouse.gov/sites/default/files/docs/leave_report_final.pdf
2“The Family and Medical Leave Act.” Department of Labor. April 26, 2016. www.dol.gov/whd/regs/compliance/1421.htm
3LaMontagne, Christina. “My Employer Offers Both HSA and FSA...” Forbes. July 13, 2015. //www.forbes.com/sites/christinalamontagne/2015/07/13/my-employer-offers-both-hsa-and-fsa-whats-the-difference-and-which-should-i-use/
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