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Planning for Maternity Leave – Length, Pay & Insurance Options

At the time I became pregnant with my first baby, I was a full-time, salaried employee at an established 500-person company. Because I didn’t start showing until close to the end of my second trimester, I chose to hold off on revealing my pregnancy until I absolutely had to.

Once I had no choice, I met with my boss and HR representative to discuss my maternity leave. They had a number of questions for me: Was I planning to return? How many weeks was I hoping to take off? And was I aiming to work up until my due date? Of course, I had plenty of questions myself: Who would take over my job responsibilities while I was out? How long would my job be held for? And, most importantly, how much of my salary would I receive while out on maternity leave?

When I got their answer to that last question, I was really thrown for a loop. Despite the fact that my company was by no means small, I was shocked to discover that I would, in fact, receive only one week of fully paid maternity leave. While my company, by law, according to the Family and Medical Leave Act, was required to allow me a full 12 weeks of leave, it had no obligation to pay me for that time.

My HR rep tried to help me find the silver lining: I’d be eligible for an additional five weeks of partial payment  – 60% of my salary, to be exact – thanks to my company’s short-term disability insurance, and I was welcome to put any unused vacation days toward my maternity leave and get paid for them in full. However, due to the timing of my due date, I knew I’d have very few vacation days left at my disposal and had to prepare for the fact that half of my maternity leave would be completely unpaid.

Having a baby is stressful enough without worrying about the monetary implications of your maternity leave. By taking the time to plan for your leave and make a budget, you put yourself in the best position to limit your financial strain once you’re taking care of your new baby.

When to Discuss Your Maternity Leave

When some women find out they’re pregnant, they want to share it right away. Others prefer to keep the news to themselves for as long as possible. The timing of your announcement is ultimately your decision, but there are several key factors to keep in mind.

Salaried Employees

If you work for a company, deciding when to bring up your maternity leave can be tough. Some women are hesitant to share the news sooner than necessary for fear that they’ll be treated differently or passed over for raises, promotions, and important projects. Although it’s against the law to discriminate against pregnant employees, unfortunately some companies (or individuals within companies) do so.

Many women wait until they’ve completed the first trimester to bring up the fact that they’re pregnant. Others, like me, tend to wait until they’re starting to show. If there are components of your job that have to be tweaked to accommodate your pregnancy, you need to make your company aware as soon as possible. For example, if you’re responsible for a lot of heavy lifting or other physical activity that your doctor doesn’t want you to do while pregnant, you should have that conversation sooner rather than later.

You also want to allow some time for your company to find and train someone to take over duties while you’re out. For this reason, waiting until your eighth or ninth month generally isn’t the best idea. The sooner you bring up the topic, the sooner you can get information on your company’s maternity leave policy. Even if you appear to be pregnant, your company most likely will not broach the subject with you until you actually reveal that you’re expecting – doing otherwise could be grounds for a lawsuit.

Self-Employed or Freelance Workers

If you’re self-employed or work on a freelance basis, you have to decide when to tell your clients or customers about your pending maternity leave. If you have a good relationship with your clients, you may opt to share your news earlier on in your pregnancy.

As is the case with salaried employees, as a general rule, be sure to give those impacted by your maternity leave a chance to secure coverage for the period you won’t be available. For example, if you’re a freelance editor and have several clients who rely on you to edit their weekly newsletters, be sure to give them at least a month, if not longer, to find someone who can take over during your leave.

Keep in mind, too, that you could wind up delivering several weeks before your due date. When mapping out a timeline for informing your clients and figuring out a backup plan, be sure to account for the fact that your baby might come out at 38 weeks instead of 40.

Some freelance moms-to-be actually line up other freelancers to assist their clients while they’re out on maternity leave. If you’re able to help your clients in this regard, it could work in your favor. Unfortunately, there’s also a chance that it could backfire, especially if you hook up your clients with another freelancer who does good work but charges less than you do. A safer bet might be for you to subcontract your work to another professional and draw up a document that specifically prohibits that person from poaching your clients once your maternity leave is over.

If you give your clients enough notice, there’s a chance they can work with you and avoid bringing in an outside person in the first place. You may be able to take on additional work in the months leading up to your maternity leave to tide your clients over until you’re ready to return. There’s also the possibility of working part-time during your leave to maintain your client relationships and handle their basic needs without having to bring another freelancer into the mix.

pregnant mom working

Length of Your Maternity Leave

Many women who go out on maternity leave choose to take 12 weeks because that’s what is covered by FMLA. The length of your maternity leave will most likely depend on a number of factors, including your company’s policy, your financial situation, and your own personal preferences.

FMLA Rules

The Family and Medical Leave Act allows eligible employees to take up to 12 weeks of leave (either consecutive or nonconsecutive) for medical reasons, including childbirth and newborn care, adoption, a major medical condition, or caring for an immediate family member with a serious medical condition. Any company that employs at least 50 people within a 75-mile radius of where it’s based is required to comply with FMLA laws. However, employers aren’t required to pay employees who take FMLA leave.

To be eligible for FMLA, you need to have been employed by your company for at least 12 months cumulatively, and worked at least 1,250 hours within the 12 month period prior to your leave request. Though the vast majority of people who meet these criteria are deemed FMLA-eligible, there are rare exceptions. For example, if your compensation exceeds that of 90% of your company’s employees within a 75-mile radius, you may be deemed ineligible on the basis that reinstating you would cause your company substantial financial harm.

Salaried Employees

If you’re a salaried employee at a company that’s required to comply with FMLA regulations, you’re automatically entitled to 12 weeks of maternity leave. If not, you need to discuss your leave period with your company and see how much time you’re entitled to.

Remember that just because you’re eligible for 12 weeks of FMLA doesn’t mean you need to take all 12 in a row. If you’re eager to get back to work or can’t afford to go 12 weeks without pay, you have the option to take less time up front and spread your remaining time out over the course of the year. Or, you can choose to take fewer than 12 weeks and forego your remaining time entirely.

Some new moms like to spread out their FMLA time to make the transition back to work easier. When I went back to work after having my first child, I took six weeks off and then returned on a part-time basis for the following 12 weeks. During that part-time period, each half-week off counted as half a week of FMLA time.

A friend of mine did something similar. She took eight weeks off to care for her newborn, leaving her with four weeks, or 20 days, of FMLA time remaining. When she went back, she worked a four-day week until the rest of her FMLA time was used up.

Self-Employed or Freelance Workers

If you’re a freelance or self-employed worker, FMLA doesn’t apply. In this case, you need to evaluate your finances, discuss your leave with clients, and determine how much time you can reasonably take off without it impacting your business long-term.

For example, if you’re an event planner and happen to be due during a period of downtime, you may be able to take off 12 weeks without it disrupting your business. On the other hand, if you’re a freelance IT consultant who’s constantly in demand, taking off 12 weeks in a row may not be feasible.

Starting Your Leave Before Giving Birth

Some women aim to work up until the day they go into labor. Others stop working a week or more before their anticipated due dates to rest up and get ready to have their lives turned upside-down for the better.

For many women, the decision to go out on maternity leave prior to delivery depends on a number of factors, including company policy, finances, and health. Some women have no choice but to begin their leave early. For example, a friend of mine was forced to stop working at 36 weeks because her doctor prescribed bed rest for the remainder of her pregnancy. She delivered about 12 days later but used up two weeks of her leave before her baby even arrived.

When I had my first child, I worked up until the day I delivered. At the time, my commute was more than 90 minutes each way, and because I took public transportation to work, I faced my fair share of unavoidable standing and walking. It was challenging to say the least, but I pushed myself because I wanted to save my time off for when my baby arrived.

If you’re unable to start your leave early for financial reasons but feel that your body can’t handle the usual grind at 38 or 39 weeks, ask your employer about the possibility of working from home until you’re ready to deliver. Some companies are flexible in this regard, and yours might allow you to work from the comfort of your home rather than subject your body to the strain of commuting.

Paid vs. Unpaid Leave

Maternity leave and paid leave are by no means the same thing. According to the U.S. Department of Labor, just 12% of private sector employees have access to paid family leave through their companies, meaning the majority of working parents have no choice but to go without pay to care for their newborn children.

Short-Term Disability

While companies don’t always pay for maternity leave, many women who take time off following the birth of a child are entitled to some compensation thanks to short-term disability. Short-term disability is a type of insurance that pays a percentage of an employee’s salary for a certain amount of time in the event of an illness, injury, or medical situation (such as giving birth) that prohibits that employee from working. In some states, such as New York and New Jersey, short-term disability insurance is mandatory for companies of a certain size.

While short-term disability is not a requirement across the board, many companies have policies that kick in following the delivery of a baby. The length of your short-term disability depends on your company’s policy. I know a number of people who got six weeks of short-term disability following a vaginal birth and eight weeks following a C-section. The percentage of pay you get also depends on your company’s plan, but most offer between 50% and 70% of your weekly salary.

In some cases, short-term disability won’t kick in until you’ve exhausted a certain number of consecutive sick days. The exact number of days and the extent to which you’re paid for them before short-term disability applies depends on the policy.

At my old company, after five days out of the office for the same illness or condition (in my case, pregnancy and delivery), our short-term disability plan kicked in, at which point I was entitled to 60% of my salary for the following five weeks. My company paid me in full for those five sick days, and that was the only week during my leave for which I received my salary in its entirety.

working mother with a baby

Paid Leave

It’s important to get a clear understanding of whether your company will be paying you while you’re out on maternity leave. When it comes to paid leave, each company sets its own rules. Some offer generous paid maternity leave packages – 12 weeks or more of fully paid leave. Others simply do the minimum by complying with FMLA regulations.

In certain companies, the length of a woman’s paid leave might depend on her position or length of employment. A friend of mine who works as a paralegal recently had a baby and was not entitled to any paid leave. Attorneys at her firm, however, are granted two months of paid leave following the birth of a baby.

Another friend’s company offers paid maternity leave based on length of employment. Women who have been with the company for at least one year are entitled to one week of paid maternity leave. Those who have been with the company for two years get two weeks of paid leave, and so forth, up to a total of six paid weeks regardless of tenure.

Combining Benefits

Even if your company doesn’t offer much in the way of paid maternity leave, there are other factors that might influence the extent to which you can get paid while you’re out.

  • Vacation Days. Some companies allow their employees to put their vacation time toward maternity leave. If your company offers only one week of paid maternity leave but you have five unused vacation days by the time you deliver, there’s a good chance you can use those days for maternity purposes and get paid for them in full.
  • Sick Time and Short-Term Disability. Some companies allow employees to use sick days to cover part of their time away from the office. The specifics of how many sick days you can take for maternity leave depend on the company. Generally, if the company has a short-term disability plan in place, you’re limited to a certain number of days before you’re automatically kicked over to it.

Self-Employed or Freelance Workers

If you’re a freelance worker or self-employed, you can pretty much kiss the idea of paid maternity leave goodbye. However, that doesn’t mean you have to go without pay for your entire leave. If you have a self-funded short-term disability insurance plan in place, you may receive benefits depending on the specifics of your coverage.

Short-term disability insurance aside, you do have the option to work part-time to help compensate for your general lack of income. The benefit of being self-employed is the flexibility to set your own hours. While it’s unrealistic to assume you’ll get much done during the first week or two following delivery, once you’re recovered and start getting used to your new routine, you may be able to squeeze in a few hours of work here and there while your baby naps. If you have family members or friends to help out during those early weeks, you can also take advantage and try to get a little work done at times when there are more hands on deck.

Health Coverage During Your Leave

A big part of planning for your maternity leave is making sure you’ve got health coverage in place. This is important not just for you, but for your new baby, as well.

Get Coverage

If you don’t already have health insurance, now’s the time to secure coverage. If you do have coverage, call in advance and find out what you need to do to have your newborn added to your existing policy. Insurance companies usually require you to add your baby within 30 days of birth to be eligible for full coverage.

Before you go out on maternity leave, find out how much it will cost to add your newborn so that you can plan accordingly. If you’re insured through your employer, this means asking a benefits professional how much you’re looking at. If you’re self-employed or freelance and are responsible for fully funding your own coverage, this is a question you’d ask your insurance company.

Paying Premiums While on Leave

As per FMLA guidelines, if you’re a salaried employee who’s eligible for FMLA, your company must maintain your health insurance coverage while you’re out on maternity leave. However, you’re still responsible for whatever premiums you pay regularly while working full-time.

Most salaried employees who have health insurance through their companies have their weekly, biweekly, or monthly contributions automatically deducted from their paychecks. However, this becomes tricky when you’re not getting a paycheck, as may be the case during your maternity leave.

If your company won’t be paying your salary while you’re out on leave, talk to a benefits person in advance and find out what you need to do to ensure that you remain covered. You may need to write out a check for your usual contribution and prepay your premium for the amount of time you expect to be out of the office. Or, you may be able to send in your premium on a weekly, biweekly, or monthly basis. Make sure you understand exactly how much you have to pay for insurance while out on leave, keeping in mind that your contribution might change with the addition of another dependent.

Making Childcare Arrangements

Whether you’re self-employed or a salaried worker, planning for your maternity leave also means planning your return to work, which means you’re probably going to have to make childcare arrangements in advance. Some women make the mistake of waiting until they’re halfway through maternity leave to secure childcare. This happened to a friend of mine, who learned the hard way that most daycare centers have waiting lists, and that finding a nanny can take several months. In the end, she had to postpone her return to work and almost lost her job in the process.

  • Daycare. If you’re looking to put your child in daycare, your best bet is to start looking at centers no later than the beginning of your third trimester. Where I live, most centers have a two- to four-month waiting list for infants. The reason is that the ratio of infants to caregivers must not exceed four-to-one by law, which means space tends to be limited. In bigger cities, the wait to place a child in daycare could be five months or longer. Keep in mind that the centers with the most competitive rates and flexible hours tend to book up earliest.
  • Finding a Nanny. If you’re planning to use a nanny to care for your child once you go back to work, you should begin the process of finding one no later than your eighth month. This gives you ample time to speak to different agencies, interview a fair number of nannies, and arrange a start date that works with your schedule.

Another good reason to make your childcare arrangements in advance is that once you deliver, you’ll not only be exhausted and pressed for time, but emotional. Try visiting a daycare center in your sleep-deprived postpartum state, and you just might run away in tears. You’re better off touring daycare centers and meeting with nannies when you have a clear head, and when there’s less pressure to make a decision with your return date looming.

Paternity or Partner Leave

The extent to which your partner is granted parental leave could impact your planning and decisions as far as your own leave goes. Some companies grant paid paternity or parental leave to the husbands or partners of those expecting. In fact, you may even find that your spouse or partner gets more paid leave than you do, even though you’re the one carrying the baby.

If your spouse or partner is eligible for paid parental leave, it could give you some added flexibility as far as your own leave goes. Some companies mandate that paid parental leave on the part of the husband or partner be taken immediately following the birth of the child in question. Others are more flexible and allow the recipients of paid parental leave to take their time off when they choose, provided it’s within a certain period following the child’s birth.

If your company offers six weeks of paid maternity leave, but your husband or partner is entitled to four weeks of paid parental leave on a flexible basis, you might consider going back to work after six weeks and having your husband or partner stay home with your baby for the following month.

FMLA Rights for Partners

Keep in mind that when it comes to childbirth, FMLA applies not just to the woman carrying the baby, but to her husband or partner. By law, men and legally recognized partners can take up to 12 weeks of unpaid leave to care for a newborn.

Even if spouses or partners don’t get paid time off, they can still be there to support you and bond with your baby during those early weeks. However, if you choose to exercise this option, you may be looking at a loss of two salaries, not just one, in which case you need to plan and save accordingly.

fathers with baby strollers

Budgeting and Saving for Maternity Leave

Once you figure out how much time off is reasonable to take, how much income you can expect during your maternity leave, and what your baby expenses might be, you can create a budget and come up with a plan to address any applicable shortfalls. The sooner you get a sense of what your financial picture will look like during your maternity leave, the sooner you can take steps to minimize any monetary hardships you might encounter.

For example, you may choose to make adjustments to your finances in advance to allow for some more flexibility once your baby arrives. A friend of mine who took 12 weeks of mostly unpaid maternity leave went on a strict savings rampage in the months leading up to her delivery. She and her partner stopped dining out, cut back their cable package, and sold a number of their possessions on eBay to bring in some additional cash. It wasn’t easy, but it gave her the option to spend three months home with her baby without having to worry as much about finances during that time.

If you’re a salaried employee, you may not have many options for generating additional income in the weeks and months leading up to your due date. While you could try finding a part-time job, the further along you get in your pregnancy, the more tired you’re likely to be, making the idea of working extra hours less appealing. However, if you’re freelance or self-employed, you could try looking into more lucrative projects to earn extra money to help fund your maternity leave.

Final Word

Whether you’re a salaried employee or work on a freelance basis, it’s natural to want a maternity leave that allows you to recover from childbirth, bond with your baby, and adjust to your new family dynamic. Planning your leave in advance and knowing how to budget for your time off can help alleviate some of your worries so that you can spend the remainder of your pregnancy focusing on your health and that of the baby developing inside you.

Also, keep in mind that it’s not unheard of for a woman to reach the end of her scheduled maternity leave and decide that she’s just not ready to return to work. If this happens to you, don’t panic. Your company may be willing to work with you to extend your leave, adjust your schedule to part-time, or make some other arrangement that better meets your needs. And if you decide that you just plain want to become a stay-at-home mom indefinitely, you wouldn’t be the first.

How much time off did you take for maternity leave? Did you feel that it was adequate, or did you return to work sooner than you would’ve liked due to finances?

Maurie Backman
Maurie Backman is an experienced writer and editor based in Central NJ who enjoys blogging about everything from parenting to money management and investing. She spends much of her time chasing after her children and chipping away at her never-ending piles of laundry. She also bakes way too often.

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