Tips for Parents with Young Children to Tackle the Rising Cost of Living 

Raising children is a rewarding experience, but it comes with its fair share of financial challenges, especially in today's world of ever-increasing living costs. From creating a budget and prioritizing needs over wants to exploring cost-saving measures and seeking alternative sources of income, these practical tips can empower parents to navigate financial challenges and provide a stable environment for their family.
30 June 2023
Tips for parents with young children

8 in 10 Singaporeans reported that because of inflation in the past year, their personal finances were affected1; 71% of their budget was allocated to spending on necessities, 34% on retirement plans, 26% on investments. As a result, families are facing financial burdens, encountering challenges in affording transportation, adapting to daily routines, and implementing necessary budget cuts.

Tip #1: Practical Money-Saving Strategies and Smart Choices

In the face of economic challenges, practical solutions can be game-changers. A good starting point is setting a realistic budget. First, discuss with your partner and draw up a list of essentials, such as diapers, milk bottles, and bedding. Then, cut down on unnecessary spending, such as dining out, and stick to your budget. Purchasing house brands or buying in bulk is also a good idea to reduce costs. 

You can also consider purchasing baby items in different stages based on your child’s age and developmental needs. This helps manage cash flow and prevents the accumulation of unused items. 

Remember, only some things for your child need to be purchased brand new. Given how quickly children outgrow their clothes and toys, consider buying second-hand items or accepting hand-me-downs from friends and family. Websites and online marketplaces often have a range of preloved or even new items at a fraction of the retail price.  

Planning for emergencies is equally crucial. MoneyOwl recommends at least 6 months’ worth of living expenses. You can consider MoneyOwl’s WiseSaver, which is liquid (2 business days) and offers an attractive annual yield, 4.18% per annum of 23 June 2023. WiseSaver is a fund which invests in Singapore Dollar bank deposits, allowing you to earn higher returns with the ability to withdraw your funds whenever you need them.

Tip #2: Understanding the Economic Landscape and Healthcare Expenses

One concern for Singaporeans is the rising costs of medical services and treatments. Healthcare inflation places a burden on your household budgets.  

With medical inflation outpacing general inflation2 , planning ahead and securing sufficient insurance coverage is important. 

As MediShield Life is a basic health insurance scheme with universal and lifelong protection against large healthcare bills, it was designed to cater to the highly subsidised B2/C wards of public hospitals. This may limit the coverage provided for those who may need a dedicated doctor and a higher class ward or private hospital. An Integrated Shield Plan allows you to stay in higher class ward or in a private hospital. 

Besides health insurance provided by MediShield Life and IPs, you can also consider critical illness coverage for your children to ensure their insurability for life. Plus, it helps cover costs which includes alternative treatments or time off from work if they’re diagnosed with medical conditions later in life, providing much-needed financial security in uncertain times. You can use MoneyOwl’s insurance comparison engine to compare over 500,000 quotes to find an affordable plan that fits your family’s needs.

Tip #3: Alleviating Financial Stress through Government Schemes

The Singapore Government offers substantial support through a range of initiatives and subsidies such as the Child Development Account (CDA) and Baby Bonus scheme for parents. Furthermore, all Singaporean households receives $300e Community Development Council (CDC) vouchers in 2023 to help with our daily essentials. The CDA comprises a First Step grant and a government co-matching scheme, which can pay for your child’s childcare fees, medical expenses, and even selected items at pharmacies. Leveraging these schemes can significantly ease the financial strain associated with raising a child. 

Additionally, there are other subsidies for childcare, providing $600 and $300 respectively to working mothers. There is also a tax relief scheme ranging from 15% to 25% is available for working mothers. 

The Singapore government has announced an enhancement to the Baby Bonus benefits on 14 February 2023. The improved cash gift of $14,000 (instead of $11,000) will be disbursed starting in early 2024 and is applicable to children born on or after 14 Feb 2023. Similarly, the augmentations to the CDA First Step Grant and CDA co-matching cap will take effect from the beginning of 2024. For the former, the grant will be $5,000 (instead of $3,000) and the latter will see an increase of $1,000 for children in the first and second birth orders3.

Tip #4: Securing Your Future with Retirement Planning

While caring for your children and managing day-to-day expenses, it’s easy to overlook long-term financial goals like your retirement. The good news is that, the earlier you start, the easier it will be to build a comfortable nest egg. 

Retirement planning isn’t just about putting money away in a savings account. Navigating the uncertainties of declining health, maintaining a sustainable lifestyle, and ensuring that savings last can be daunting for many Singaporeans. Inflation should also be factored in to ensure that the value of their money is not eroded away.  

Financial freedom doesn’t happen overnight – get a comprehensive financial plan to help you achieve your life goals, no matter what happens along the way.  Take advantage of the power of compounding and start investing early in MoneyOwl’s Dimensional portfolios. Dimensional is based on an investment strategy grounded in Nobel Prize-winning economic theory, which helps you grow your money reliably in a selection of broadly diversified portfolios. 

Speak to MoneyOwl’s dedicated team of salaried client advisers who are unbiased and able to provide you with sound financial advice towards a worry-free retirement.

In Conclusion

While the rising cost of living may pose challenges for parents with young children, it is important to remember that you are not alone. By implementing these tips and exploring additional resources and support networks available in your community, you can take proactive steps to mitigate the impact of inflation and create a more secure financial future for your family. With determination, discipline, and a focus on long-term goals, you can successfully navigate the financial landscape and provide the best possible upbringing for your children.


While every reasonable care is taken to ensure the accuracy of information provided, no responsibility can be accepted for any loss or inconvenience caused by any error or omission. The information and opinions expressed herein are made in good faith and are based on sources believed to be reliable but no representation or warranty, express or implied, is made as to their accuracy, completeness or correctness. The author and publisher shall have no liability for any loss or expense whatsoever relating to investment decisions made by the reader. 



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