Looking back at her childhood, Bo Zhao remembers that her parents were always trying to save money and also worked very hard. “They were entrepreneurs too,” she recalls. “And it’s something that I didn’t really appreciate when I was younger—just how hard they worked not only to reach for their dreams but to provide for our family.”
Their frugal mindset always stuck with Zhao who went to school to earn an MBA and her doctorate in material science and engineering as well. Soon, she was working for her parents’ company.
When she got married and pregnant in 2018, Zhao decided to take a step back. Becoming an expectant mom felt like “a wake-up call” to pay more attention to her finances, especially her savings.
“If you think about becoming a parent—even a grandparent—eventually you are providing for your child, but also potentially for your grandchild as well,” she notes. “And so you have to plan your money for three generations, right? And your own retirement. So, suddenly, it becomes not just you and your daily needs.”
At the same time, she wanted to be sure to give her daughter Milu the best of everything.
“I remember there was a statistic that I read about how new parents pay $12,000 on average for their child’s first year of life,” says the Philadelphia-based mom. Much of that is spent on baby gear along with other necessities like diapers, clothing, child care. “It sounds like a huge number, but it is so true.”
She went down rabbit holes trying to figure out what type of gear to buy for Milu. It needed to be the right price, the best quality, and also fit into the family’s 800-square-foot space.
Ultimately, Zhao and her husband spent $5,000 on baby gear, including a “high-tech bassinet” that their daughter hated.
“We didn’t have places to store things, and some items you never use, and the things you do use, you only use for three months,” she recalls. “You’ve just essentially spent all this money on gear that becomes clutter, that you don’t have a use for anymore.”
Through navigating this experience and going through the “painful purchases, mistakes, and regrets,” Zhao wished there was a service that would allow her to try baby gear out for a set period of time that her daughter needed it. “And then, when I was done, it would just magically disappear,” she says. “I wouldn’t have to worry about selling it on Facebook or some sort of secondary marketplace or even donating.”
After talking about her baby gear conundrum with other parents, Zhao realized it was a widespread issue. “That’s when I decided to create that solution,” she says.
Zhao created Baby Gear Group to help other parents facing similar challenges.
“The average family spends about $6,000 on durable baby gear in the first year,” she says. “And with my service, they could save $2,000 to $3,000 easily and maybe even more.”
The service, which is currently local to Philadelphia, allows parents to sign up for a monthly membership so that they can rent infant and toddler gear like strollers, cribs, toys, and sleepwear.
Although it has yet to reach profitability, Zhao, who’s currently expecting her second child, hopes that it will in the next year or two. “That’s not so much because I want to make a lot of money, but more so, because I think it’s a very important service that helps a lot of moms,” she notes. “And it’s just something that should exist out in the world, and it needs to be able to sustain itself as a business.”
Here, some of Zhao’s best money-saving tips for new parents.
Rent Most Big-Ticket Items
Although Zhao says you should invest in a car seat and crib, you can rent a bassinet, stroller, and even toys.
“You know, your child may lose interest after a couple of months, especially if they outgrow the purpose of that toy, developmentally,” says Zhao. “Something like a stroller could have a longer lifetime, but it could also be really short.”
Invest for the Future
In addition to saving money, Zhao recommends investing so that you’re covering the expenses that will come up down the road for your child and even future generations. While starting her business, she eventually decided that she needed professional help and hired a financial advisor.
The soon-to-be mom of two ended up investing her savings in order to grow passive income to contribute to the family’s bottom line, and one of the cornerstones of her portfolio is a S&P 500 ETF, which is an inexpensive way for investors to gain diversified stock in the 500 largest U.S. companies.
Do What’s Best for Your Unique Baby
One of Zhao’s best tips for new parents is that parenting advice isn’t one-size-fits-all.
“There’s no one perfect way to parent, and whatever it is that you decide to do, it’s going to be right for you and your family,” says Zhao. “Every baby is unique. Whatever it is that you want to do, whether it’s sleep training or not sleep training, or baby-led weaning or not, there are so many different strategies. Whatever you choose, just have confidence that you were doing the right thing and the best thing for your baby.”