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Having Twins? Reduce Related Money Woes

Aug 15, 2016 3 min read Daniella Latham


Two sets of tiny hands and feet. Big smiles, sleepless nights…and lots of questions: “Where do we go from here?” I’m not sure what was in the water back in school, but a few college friends all have recently embarked on a trip into unknown territory – the wild, wonderful world of twins. All of them were thrilled at the idea of a double bundle of joy, but there was also a perfunctory angst when they thought about the financial implications. “How can we afford it?” and “We need to save for college!” were the hallmarks of many conversations. But you can plan and manage your budget (and your life!) when you have twins. Here are some ideas for how.


“I was excited to have twins, but was scared about managing our finances.”

Average, middle-income parents can expect to spend $25,880 on twins in their first year Opens in a new window, according to 2013 figures from the U.S. Department of Agriculture (USDA), with “Middle income” defined as having a combined gross income of $61,530 to $106,540.

Before you start adding up the lifetime costs to care for your children, take a look at your current budget. Have you reached any initial financial goals you may have set as a couple? If you haven’t done it yet, tally up your monthly and yearly expenses to see where any extra costs may be creeping in—and where you can add that money to taking care of your growing family.


“I didn’t realize how many websites cater to saving money for parents.”

Think about the immediate needs for your newborns, and purchase just what your babies will need in the first few months. For example, when your babies first come home, they can sleep in cradles or bassinets in your room. This means you can hold off on that crib purchase until they get a little bigger. You also won't need a high chair right away. Just be sure you have your car seats purchased and installed before you go to the hospital.

Make your own baby food. Get a small food processor and make your own baby food from fresh fruits and veggies. It's a lot cheaper than most baby food found in the store. Just be sure to freeze any leftovers so they don't spoil.

Use the Web. Signing up online could be a goldmine for coupons from your favorite manufacturers, so look at online social sites just for moms, such as AmazonMoms.com Opens in a new window or couponcabin.com. Many offer special deals on baby purchases.

Borrow when possible. Ask friends and family with older children if they have anything they aren't using. Most will be more than happy to get rid of baby clothes and other gear. You can also borrow essentials like a changing table (you'll want to buy a new pad for it), a highchair or booster seat, baby slings or backpacks, and a dresser.


“Some days my husband can work from home, which saves on some daycare costs.”

Long gone are the days when one parent stayed at home tending to the children and the house. Today, the reality is that dual-income households are the norm. In fact, 66% of married households contain two adults that work on either on a full- or part-time basis. Daycare, as a necessity, is a cost that needs to be factored in to your monthly and yearly budget.

The average cost of center-based daycare in the United States is $11,666 per year ($972 a month), but prices range from $3,582 to $18,773 a year ($300 to $1,564 monthly), according to the National Association of Child Care Resource & Referral Agencies (NACCRRA). The plus side with twins is that many preschools and day cares offer sibling discounts, sometimes as high as 15% or more. Nannies may also offer similar reduced fees—one child may cost $30 per hour, but for twins the price may only increase slightly. And two working parents can take the first $5,000 out of their pre-tax income by signing up for a dependent care program.


“We had no idea how to start saving for college.”

Before you know it, the years will fly by. If your children choose to go to college, it can be expensive, and costs increase each year. Even if the annual college-cost inflation rate remains about the same, parents of children born in 2012 can expect to spend more than $31,000 a year on tuition and fees Opens in a new window alone at an in-state, four-year public college.

Open up a 529 plan for each child for college savings. You can take advantage of one plan per child—so that means you can save for both kids at the same time. You can also transfer funds between each 529 account Opens in a new window. Transfers between siblings are not considered rollovers, so moving around within an existing 529 plan does not affect your ability to pursue a rollover, if needed.

A 529 plan is a tax-advantaged savings plan designed to encourage saving for future college costs. 529 plans, legally known as “qualified tuition plans,” are sponsored by states, state agencies, or educational institutions and are authorized by Section 529 of the Internal Revenue Code. It’s one of the most popular options for making sure school expenses will be covered when your child reaches college age.


“Thinking about insurance made me stress out—I had no idea how much we needed.”

One important but often overlooked area to examine with twins (and any growing family) is life insurance. If something were to happen to you, how will your family pay for expenses, such as a mortgage, child care or everyday expenses? This is when life insurance comes into play. There are two main types: permanent life and term life insurance. Permanent life insurance provides coverage for the rest of your life, and term only provides coverage for a specific amount of time. It’s best to estimate Opens in a new window how much you may need before you purchase a policy.

You should also think about who the guardians for your children will be if something were to happen to you and your spouse, and then have a will drawn up. Another way to plan is to start an emergency fund: save 6 to 12 months of living expenses in case you may need it.


Bottom Line

“Having twins is…fun, scary, and oh yes…never dull!”

Planning for twins doesn’t have to be more stressful than planning for one child. You can start to plan and save now—and focus on a happy and healthy future for both of your little ones.


If you secure tomorrow, you can enjoy today.

Help make sure your loved ones are protected if something happens to you, with Prudential Life Insurance.

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