28th October 2026 - 8 min read
Childbirth at a private hospital can cost RM10,000 to RM20,000, according to financial planner Kam Teik Guan. A confinement centre adds about RM10,000. Parents also need to budget for childcare and the chance of losing one income.
Guan says the main earner should have enough insurance before the family starts saving for the long term.
We spoke to Guan at the Financial Planning Association of Malaysia (FPAM) office on 21 October 2026 for Financial Literacy Month 2026. He has been a Licensed Financial Planner under the Securities Commission Malaysia since 2016 and holds the Certified Financial Planner (CFP) designation. He is also an FPAM-accredited member. He currently works with IPPFA, having started his career in banking before moving into the life insurance industry.
Guan said a common mistake in the first year as parents is not counting the full cost of raising a child. Besides the usual expenses such as nappies and milk, parents need to count pregnancy check-ups, childbirth, vaccines, medical bills, and childcare.
| Expense | Estimated cost | Notes |
| Childbirth at a private hospital | RM10,000 to RM20,000 | Can be higher if there are complications |
| Confinement centre | About RM10,000 | Luxury packages can cost RM20,000 or more |
| Helper to care for the baby | RM2,000 to RM3,000 a month | Ongoing cost |
These costs don’t cover everything. Parents should also account for lost income if either spouse takes time off or stops working after the baby arrives. Spending too much on things you don’t need, such as big celebrations and expensive photoshoots, is another mistake Guan sees.
With a new baby to support, parents may want to focus on their child’s medical insurance and education savings first. However, Guan says protecting the parents, especially the main breadwinner, is equally important.
He compares protecting the breadwinner first to the oxygen-mask instructions on an aeroplane. Passengers put on their own masks before helping others. If a parent dies or becomes permanently disabled without enough insurance, the family still has bills to pay. These include the home loan, car loan, groceries, and the child’s education.
For this reason, Guan recommends putting the breadwinner’s protection first if the family can only afford to insure one person. Life insurance can provide a payout after death or total and permanent disability (TPD).
A common guide is life insurance of 10 to 15 times your annual salary. That’s enough to replace your income for that many years. Guan suggests five times annual salary as a more realistic start. If you can’t afford that yet, begin with one to two years of salary and increase the cover as your income grows. You may need less if you already have large assets and investments and your debts are under control.
Guan suggests the amounts below for life insurance, critical illness cover, and a medical card. A medical card is a health insurance plan that covers hospital bills.
| Type of cover | Guan’s suggested amount | Example based on RM60,000 annual salary |
| Life insurance (death and TPD) | Five times annual salary at first, then 10 times | RM300,000, then RM600,000 |
| Critical illness | Three to five times annual salary | RM180,000 to RM300,000 |
| Medical card | Annual limit of at least RM1 million | Same for all salary levels |
Guan estimates that a 30-year-old parent might pay around RM200 a month for a starter package. It includes RM200,000 in death and TPD cover and RM50,000 in critical illness cover that can be claimed more than once. It also includes a medical card with a RM3 million annual limit. This is a starting point, so add more cover as your income grows. Covering the whole family could cost around RM600 a month, he said.
For your newborn, Guan said prenatal insurance may be available from 13 weeks of pregnancy. Ask your insurer or agent about it. If you don’t have prenatal insurance, he recommends a basic medical plan for your child once the baby is one month old. Children’s treatment can’t be delayed.
Employer medical benefits usually have limits of RM20,000, RM30,000, or RM40,000 depending on employee grade, Guan said. The family pays any bill above the limit.
Before the baby arrives, sit down with your spouse to review your finances and work out a budget. Guan recommends checking your savings and your child’s medical coverage under your employer’s benefits. Also work out how many months your family could manage if an unexpected expense or loss of income happened.
Aim for three to six months of salary in emergency savings before the baby is born. If you have only RM500 left over each month, start with one month’s salary as your first step. Guan suggests putting the full RM500 into savings until you reach it. For someone earning RM5,000 a month, this takes 10 months if they save every month. After that, they can put RM200 a month towards basic medical insurance and RM300 towards investments.
Don’t wait for these savings to get your baby’s basic medical plan. Guan said to get it when the baby is one month old.
With emergency savings, you won’t have to sell investments at a bad time. You also won’t struggle to pay insurance premiums when an unexpected expense comes up. Guan suggests a unit trust fund if you want your emergency savings to grow too. You can withdraw from it within a few days. Its value can rise or fall, unlike money in a savings account.
If you can’t save for both retirement and your child’s education, Guan puts retirement first. Saving for retirement helps you stay independent and depend less on your children later. He advises talking openly with your child and encouraging them to take responsibility for their own future.
To see what this could involve, we looked at the costs of studying locally. Guan estimates that a four-year degree at a public university can cost as little as RM10,000, depending on the course. With living costs, the total is about RM40,000 to RM100,000.
We collected the total degree fees for local students at several private universities, based on university fee schedules as of October 2026.
| Degree | Total degree fee | Source |
| MMU undergraduate degree (3 to 4 years) | RM55,000 to RM80,000 | MMU fee structure from 1 October 2026 |
| Taylor’s Business School degree (3 to 4 years) | RM114,074 to RM133,838 | Taylor’s Business School fee schedule, 2027 intake |
| Taylor’s MBBS (5 years) | RM446,690 | Taylor’s MBBS fee schedule, September 2026 intake |
Living costs are separate from fees and depend on where students live. For students living on a public university campus, UTM estimates basic living costs at about RM1,000 a month. College rent adds RM360 to RM450 a month. Over four years, this adds up to about RM65,000 to RM70,000, counting 12 months a year.
Guan also advises against taking on debt for education unless you have to. Education may look very different in future because of AI.
If you can save for both, Guan recommends starting with the National Education Savings Scheme (SSPN). It gives eligible parents tax relief of up to RM8,000 a year on net savings. Net savings means deposits minus withdrawals. The relief is available until the 2027 year of assessment. Saving RM8,000 net for the 2026 year of assessment could cut your tax by up to RM2,000 at a chargeable income of RM120,000. At RM60,000, it could cut your tax by RM880.
Other options are Amanah Saham Bumiputera (ASB), unit trusts, and education insurance plans. ASB is open to Bumiputera investors only. Unit trusts offer local and overseas funds, depending on the risk you’re comfortable with. Education insurance plans have a payor benefit. This means your child still gets the payout when the policy matures even if the paying parent dies or suffers TPD.
Guan encourages families to work with a licensed financial planner. The plan should cover their income, assets, debts, spending, and future needs.
Review the plan whenever your circumstances change. Before you start, check the planner’s licence status in the Securities Commission’s Public Register of Licence Holders and Registered Persons.
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The views in this article were shared by Kam Teik Guan as general guidance and are not personal financial advice. The information is accurate as of 21 October 2026. Every family’s needs are different, so get advice from a licensed financial planner before making a decision.
Iman writes about personal finance with curiosity. She is interested in the stories behind money, the hesitation around big decisions, and the small habits that shape financial futures. Off the clock, she is either dissecting a film or climbing her way up the leaderboard in her favourite games.
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