Adoption Financial Aid
A child is truly a bundle of joy and can add a lot of meaning to your life. If you are unable to have a child of your own, then adoption is a great way to fill the gap that exist in your life. There are many agencies that facilitate adoption and these agencies help you find the baby that will perfectly fit into your lives.
Though adoption can bring a lot of joy and happiness, it also comes at a cost. It is not cheap to adopt a baby in the United States. As a foster parent, you have to bear the medical expenses of the birth mother, travel expenses, the fees and charges required by the state and the commission of the agency. This can even go up to $40,000 in some cases and so its important you are financially prepared for it. If you do not have the money to adopt a child, you can always look at some options like loans, grants and tax credits.
Adoption Tax Credit
The Government offers tax credit for expenses incurred to adopt a child including one with special needs. Tax credit is given the following year for the payments made related to adoption in the previous year. This credit is not allowed for expenses that were reimbursed by the company or health insurance. You are eligible to claim up to $13,150 per child. If you are married, you should file a joint return to get the credit and if you are filing separately, then you can get a credit only if you meet certain requirements.
You can borrow money from the bank to meet your adoption expenses. There are four ways to raise money and they are Home Mortgage Refinance, Home Equity Line of Credit, Credit card and Personal Loans. Refinancing is an option that will lower your monthly mortgage payments and you can use this extra money to save for adoption or to pay-off another loan that you have taken to meet the adoption expenses. Refinancing is done when the adjustable rate mortgage (ARM) is likely to go up or when you are moving from a fixed rate to an adjustable rate. This is a good time to negotiate with the bank regarding the rate and depending on your credit score and the regularity of your payments, the bank may agree to refinance your mortgage.
The second option is to get a line of credit on your home. In this option, you borrow money from the bank against the equity of your home. This depends to a large extent on the amount of equity you have gained so far and the amount of loan you require. While using the option, its important you make plans to pay this money back. Otherwise, you can end up in a deep financial crisis.
Credit cards are another way to pay adoption costs. This option can be particularly useful if you are waiting for funds from other sources or if you are close to a deadline. In such cases, you can use the credit card, but make sure to pay it off as soon as you get money from your other sources. This is important to prevent a pile-up of loans. Also, the credit card rates are exorbitant and so its a good idea to pay them off as quickly as you can. Look for cards that do not have any annual fee and offer lowest rates of interest.
Some banks offer personal loans that can be used to meet any adoption-related expense. However, the rate of interest on these loans can be quite high. So, look around for the lowest rates and keep this as the last resort.
There are many philanthropic organizations that offer grants to help families adopt. However, these grants may not meet the total expense and also the adopting families have to meet certain criteria like specific children or countries or any other specification laid down by the granting organization. The best part about grants is there is no repayment and so this can go a long way in reducing the financial burden of adoption. Some organizations provide money in the form of loans that come with little or no interest. A partial list of organizations that provide adoption grants are mentioned below.
The Oxford Adoption Foundation provide loans to families that adopt international children. These loans have no interest or very low interest rates for qualified families. The National Adoption Foundation is another organization that provides loans to families who are financially or economically challenged. These loans have low interest rates and the qualified families should follow certain rules before, during and after adoption. The Boatner Family Foundation provides grants ranging from $1,000 to $10,000. They require a financial statement and the approval of an agency at the time of application.
Gift of Adoption Fund is another organization that provides assistance to low income families. These grants can be worth up to $5,000 and preference is given for families that are experiencing any kind of financial or emotional crisis. God’s Grace Adoption Ministries offer loans to Christian couples who make less than $60,000 a year. This grant can be anywhere between $1,000 to $4,000. Home for Good is an organization that offers grants to families who adopt mentally-challenged kids, older children or any child that has been difficult to place with families. The amount of grant depends on the situation.
Open Arms Children Charities provides grants twice a year – January 15 and June 15 to families that are looking to adopt. They require that a home study should be completed in order to become eligible for these loans. Caroline’s Promise offers grants to North Carolina families while Fore Adoption Foundation provides grants to families that are adopting kids from the United States. There are other numerous philanthropic foundations that are looking to grant money to adopt a child. So, look around for such organizations and a good place to check is your local church. You can get in touch with any one of these agencies to get a grant or a low-interest loan. Most of them have an application procedure that you have to follow and make sure you meet the criteria laid down by these organizations to become an eligible applicant.
Many employers are offering to meet adoption costs as part of the employee benefits. However, the employee has to meet certain criteria like salary, age and other factors. Some major companies that have adoption programs are AARP, American Express, Bank of America, Best Foods, Bristol-Myers Squibb, Campbell Soup, Chevron Corporation, Walt Disney, Ernst & Young, GE, Nabisco, Motorola, Oracle, Novartis, Seattle Times, Unisys and Xerox. It is a good idea to check with the HR Department of your company regarding its adoption rules and grants before you look at other sources.
Most health insurance companies cover the medical expenses related to an adopted baby. Check with your insurance provider for their adoption policies. If your insurance provider does not cover adoption expenses, the shop around for an insurance plan that will provide comprehensive coverage for your adoption.
If you or your spouse is in the military, you may be eligible for adoption reimbursement expenses up to $2,000.
In short, adoption costs can be high and your options can range from grants to high interest bank loans. Before you adopt, have a financial plan and save the required money or have a good plan to repay the borrowed loans. This will prevent you from falling into a financial crisis. So, plan well, bring the baby home and enjoy this precious joy of your life.