A first baby brings ~$13,000-$15,000 of first-year costs even before lost income from parental leave. Here’s the complete checklist of what to set up, when, and how, so you’re not figuring out CRA paperwork at 3am with a newborn.
Before the baby arrives (months 6-9 of pregnancy)
- Apply for EI Maternity + Parental benefits. You can apply as early as 12 weeks before your due date. You’ll get up to 55% of weekly earnings (max $668/week in 2026) for maternity (15 weeks) + parental (35 weeks standard OR 61 weeks extended at lower rate). Apply at canada.ca/ei-maternity-parental.
- Check employer top-up. Many employers top up EI for 6-17 weeks. Ask HR — don’t assume nothing exists.
- Increase your life + disability insurance. If you only had small employer-provided policies, now is when you need real coverage. How much life insurance you actually need.
- Build a 6-month emergency fund. Babies bring uncertainty — surgery, daycare delays, a colicky stretch where someone needs to be home unexpectedly. 6 months of expenses in a HISA.
- Practice living on your post-leave income for 2-3 months before the baby arrives. Bank the difference.
The week the baby is born
- Register the birth with your provincial Vital Statistics office — usually done at the hospital but you need to follow up online. This generates the birth certificate.
- Apply for a SIN for the baby. Done at the hospital via the Newborn Registration Service in most provinces, OR at Service Canada within a few weeks. Required for CCB and RESP.
- Apply for Canada Child Benefit (CCB). Through CRA My Account → “Apply for child benefits” or via Form RC66. Takes 8-10 weeks for first payment. Up to $7,787/year per child under 6 ($6,570 ages 6-17) in 2026, income-tested.
First 3 months
- Open an RESP. The Canada Education Savings Grant (CESG) gives you 20% on contributions up to $2,500/year = $500 free money per year. If you don’t use it, you lose it. Complete guide to registered accounts.
- Update your beneficiaries on RRSP, TFSA, life insurance, employer pension. Most people forget this.
- Write or update your will. Specifically: appoint a guardian for the baby. Without it, the courts decide if both parents die.
- Set up automatic savings to the RESP. $208/month maxes out the annual CESG.
- Update tax-credit forms at work (TD1 federal + TD1 provincial) to reflect the new dependant. Increases your take-home immediately.
Months 4-12: Real cost reality check
The big costs that hit:
- Daycare: $200-$500/month under the $10/day program (where available — Quebec, parts of ON, BC, AB rolling out). Without subsidies: $1,200-$2,500/month per child in big cities.
- Diapers + formula: $150-$300/month combined if not breastfeeding.
- Gear (one-time): Stroller, car seat, crib, monitor: $1,500-$3,000 minimum.
- Income gap: EI max replaces 55% up to a cap. If you earned $100K, EI gives ~$35K/year max — a $65K gap. Employer top-up may close half of that.
Year 1+: Ongoing optimizations
- Maximize CCB by lowering your taxable income — RRSP contributions, FHSA contributions, childcare expense deduction all reduce the income that’s used to calculate CCB. Lower income = bigger CCB.
- Claim childcare expenses on your tax return (up to $8,000 per child under 7).
- Spousal RRSP split if income gap is large. The higher earner contributes to the spousal RRSP. On withdrawal, it’s taxed in the lower-earner’s hands.
- Check your provincial child benefits. Ontario, Alberta, BC, Quebec all have provincial top-ups on CCB.
Frequently asked questions
Can both parents take parental leave at the same time?
Yes, but the total weeks are shared between you, not doubled. The standard parental benefit is 40 weeks combined (one parent can take a max of 35), and the extended option is 69 weeks combined (one parent max 61). There’s also a 5-week “parental sharing benefit” bonus (8 weeks under extended) if both parents take at least some leave — so taking even a short overlap actually adds weeks to your total.
Should I choose standard (12-month) or extended (18-month) parental leave?
The total dollars are roughly the same — extended just stretches the same pot over more weeks at 33% of earnings instead of 55%. Standard usually makes more sense if you have an employer top-up (most top-ups only apply to the standard track and only for the first 6-17 weeks). Extended can work if licensed daycare in your area has an 18-month waitlist, which is common in Toronto, Vancouver, and Ottawa. Once you start receiving benefits, you generally can’t switch, so model both before applying.
Is the Canada Child Benefit taxable?
No — CCB is completely tax-free and doesn’t get added to your income on your T1. But it’s calculated based on your family net income from the previous tax year, so a high-earning year reduces next July’s payments. This is why RRSP and FHSA contributions are doubly powerful when you have kids: they cut your tax bill and increase your CCB. When my mom asked me why my sister’s CCB dropped one year, it was exactly this — a bonus pushed her family net income over a threshold.
What happens to RESP money if my child doesn’t go to post-secondary?
You get your own contributions back tax-free anytime. The CESG grant money (up to $7,200 lifetime per child) has to be returned to the government. The growth can be withdrawn as an Accumulated Income Payment, but it’s taxed at your marginal rate plus a 20% penalty — unless you have RRSP room, in which case you can roll up to $50,000 of growth into your RRSP and avoid the penalty entirely. You also have until the child turns 35 (for a standard individual RESP) before the account has to close, so there’s no rush.
Do I need to update my will if I already have one?
Yes — specifically to name a guardian for the baby and to update beneficiary structures. A will written before kids almost never addresses guardianship, and provincial intestacy rules won’t pick the person you’d choose. While you’re at it, consider whether bequests to a minor should flow through a testamentary trust rather than directly, since a child can’t legally receive a lump sum until 18 (19 in some provinces) regardless of what your will says.
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