How to Take Maternity Leave Without Breaking the Bank

by Emily Guy Birken · 7 comments


During my first year of teaching, one of my friends in the English department had a baby halfway through the school year. In chatting with her about how she and her husband (a teacher in another district) planned to pay for parental leave to welcome their baby home, I was shocked to discover that neither school district paid for maternity leave. Instead, both my friend and her husband had to use their accrued sick and personal days to cobble together a few months of paid leave.

My shock came from a misunderstanding of the Family and Medical Leave Act (FMLA). I thought it provided for parents to take time off with their new arrivals (or take care of ailing family members). In reality, all FMLA guarantees is that your job (or an equivalent) will be waiting for you at the end of your leave.

According to a 2011 census report, only 50% of first-time mothers receive paid leave — and that figure includes people like my friend, who had to use her sick days.

If you’re expecting a child and rely on your paycheck (and who doesn’t?), a lack of paid maternity leave can turn your joyous event into a financial headache.

What You Need to Know About Maternity Leave

Understanding the FMLA

This important legislation allows both men and women to take up to 12 weeks of unpaid leave to care for a new baby, a newly adopted child, or handle other health-related family crises. At the end of the 12 weeks, your employer must allow you to return to your job or a similar one with the same salary, benefits, working conditions, and seniority.

There are several holes in FMLA’s coverage, however, and only about 60% of American workers qualify. To be eligible, you must work for a company with more than 50 employees, and you must have been employed for at least 12 months and worked a minimum of 1,250 hours prior to taking your leave.

FMLA does allow you to take your 12 weeks any time during pregnancy (or adoption proceedings) or the year after the baby’s arrival. This means you could take your 12 weeks all at once, take the time in chunks, or reduce your daily or weekly schedule.

But even if you do qualify for FMLA, it isn’t paid. If your employer doesn’t offer paid leave, here are a few options:

Short-Term Disability Insurance

Some employers who offer paid maternity leave make use of short-term disability insurance to do so. Even if your employer doesn’t offer this, it’s possible to purchase your own short-term disability policy to cover your maternity leave. (You must purchase this policy before you get pregnant, as your pregnancy will otherwise be considered a pre-existing condition.)

Short-term disability will generally pay about 2/3 of your salary for a maximum of 6-8 weeks. Having such a policy in place can also help if you happen to have any complications during your pregnancy or postpartum. It’s important to note, however, that you’ll generally owe taxes on your short-term disability payments, which won’t be taken out of your checks.

Negotiate with Your Employer

Many women are nervous to talk to their employer about their maternity leave needs, but it can really pay off. Pat Katepoo, author of “Max Your Maternity Leave,” says it’s imperative to negotiate for the paid time you need with your baby.

Offer to take on more projects or responsibility before the baby comes, and ask that the extra hours be applied to maternity leave pay. Or, Katepoo suggests simply asking for some paid time off. If you’re a valued employee, your employer will work to keep you happy.

Cut Your Costs

If you know there’s no way to receive paid time off after your baby’s birth, then it’s time to start looking at your budget. How much money will you need to replace while you’re on leave? What parts of your budget can you cut?

Once you’ve asked these hard questions, start automating transfers from your checking account to a maternity leave savings account. That way, you’ll pay yourself first without having to think about it.

The Bottom Line

New parents in America have an unenviable task when it comes to paying for the time off they need to welcome a new baby. Planning ahead and being willing to negotiate and cut costs can all help make your baby’s arrival blissful — rather than financially stressful.

What would you do/what have you done if your company didn’t offer paid maternity leave?

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  • Pat Katepoo says:

    Thanks for including a few of my tips. I encourage women to view the employer policy or usual practice as a starting point, and negotiate from there. Expanding your possible options means more time with your baby.

  • My sister had to take her sick days as well. Some schools have insurance that pays for your maternity leave as if you were working. My friend carries an Aflack insurance for maternity leave. She says it is very expensive, but if you need it, you need it.

    • David Ning says:

      It’s interesting that you can get maternity leave insurance, because most people won’t pay until they actually start trying to conceive. Maybe that’s part of the reason why the premiums are so high though!

  • I find it so bizarre that America ‘the land of hope and opportunity’ has such draconian employment practices.

    In the UK women are entitled to 12 months maternity leave. 39 weeks of that is paid leave. The first 6 weeks’ is 90% of your normal salary then £138.18 ($225.60) for the next 33 weeks. The last 13 weeks are unpaid. After 26 weeks you are entitled to return to the same role, after that it must be the same or similar role. There is some eligibility required (need to have worked for 26 weeks by the point of 15th week before childbirth hence you could be pregnant during that 26 week period) and there is no escape clause for small employers. Quite frankly I find the whole concept of taking out short-term disability insurance insulting, maternity leave is time off to care for a child – not a disability!

    My partner has recently been offered the opportunity to move to America to work but I am against it because of the poor employment laws. I am a lawyer in the UK and no way do I want to be returning to work with a 12 week old baby at home.

    I really don’t know how Americans cope with having children. Hats off to you all!! I will read in interest.

    (I will now proceed to criticise paid vacation!)

    • David Ning says:

      Leaving the child to go to day care or finding a nanny is a difficult choice moms make here. The good side is that there are some amazing care takers in our area so that eases the pain.

      I remember when we first brought our oldest to childcare, we were actually glad that there’s a natural place for us to ask so many newbie questions.

  • We took advantage of short term disability and accrued leave. For our second baby, we negotiated with our daycare to step down to a minimum number of hours for our oldest child in order to cut costs.

    • David Ning says:

      Oh I didn’t know you can negotiate hours at daycares! Maybe this is something we can do, since we don’t necessarily need to send our kids to school the minute they allow us to drop off our child.

      Thanks for the tip Kirsten!

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