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Having a baby is perhaps the most incredible and memorable experience of a person’s life. But it’s also one of the most expensive.
New parents will have to stay home for a certain amount of time, which means they’re losing out on pay that they otherwise would have collected when working. Plus, the onslaught of expenses that occurs when bringing a new baby home can put a huge financial dent in a family’s budget.
It’s estimated that women between the ages of 25 to 34 experience a 48% income loss over the first year after having a baby while on maternity leave.
To help with the financial burden of having a baby and being off work for a temporary amount of time as a result, most new parents apply for Employment Insurance Maternity Leave (EI). This payment comes from the government and is designed to help families financially when one income is temporary on hold to care for an infant.
Employment Insurance (EI) benefits offer financial assistance to women who are off work because they’re either pregnant or have recently had a baby and must stay home to care for the child. These benefits can last up to 15 weeks.
While it’s usually the mother who stays home from work to care for their baby, fathers may also choose to stay home instead.
Maternity benefits are available to parents who stay home from work to care for their child, and can’t be shared between parents. The individual receiving maternity benefits may receive parental benefits, which are available to the parents of a newborn or newly adopted child.
The person applying for maternity leave has 2 options to choose from:
Once the initial 15 weeks of maternity leave expires, parents may receive standard parental benefits. These benefits last up to 40 weeks, though one parent is not allowed to receive more than 35 weeks of standard benefits. That means one parent may receive up to 35 weeks in benefits, while the other parent can receive another 5 weeks of standard benefits.
Parents may also apply for extended parental benefits, which last up to 69 weeks. However, one parent cannot receive more than 61 weeks.
If both parents decide to share the benefits, each one will have to choose the same option and apply separately. Parents can choose to receive their weeks of benefits simultaneously or one after the other.
In order to qualify for maternity leave benefits, you must meet the following criteria:
Eligible parents can begin collecting maternity benefits starting 12 weeks before the due date or the date the baby is born. Parents cannot receive benefits for any longer than 17 weeks after the due date or the date the baby is born, whichever of the two is later.
Eligible parents can begin collecting paternity benefits starting the week of the baby’s date of birth or the week that an adopted child is placed in the care of their new guardian. For standard parental benefits, the period is within 52 weeks, and for extended parental benefits, the period is within 78 weeks.
The exact benefit amount paid out is calculated using a specific number of a person’s highest-paid employment weeks, known as the “best weeks.” The number of best weeks used in the calculation is based on the unemployment rate in the applicant’s specific location, which can range from 14 to 22 weeks.
Those who qualify for maternity leave benefits can get paid up to 55% of their regular earnings for standard parental benefits, to a maximum of $638 per week. For extended parental benefits, the payout is up to 33% of the parent’s regular earnings and up to $383 per week.
Eligible applicants will receive the first benefits payout within 28 days of the date that the application is received and all required documents are submitted.
Prior to receiving EI benefits, there is a one-week waiting period before payment will be made, which is somewhat like a deductible paid when filing an insurance claim.
It’s important to apply for EI benefits as soon as possible; otherwise, you would risk losing your benefits.
To apply, follow these steps:
Choose your benefits. Decide whether you will be applying for maternity or parental benefits.
Complete the application online. You’ll need to supply the following information when applying:
You have 72 hours after starting your application to complete it. If you don’t complete the application in this time frame, you’ll have to start over.
Provide additional information. Other information will be required, including the following:
Provide your record of employment. Service Canada will use this information to determine whether or not you’re eligible for EI benefits and how much you’ll receive.
Wait for your benefit statement and access code. After completing your application, you’ll receive a benefit statement and access code by mail. You’ll need this code and your SIN to access updated information about your application.
Review the status of your application. To check your application status, you can log into your MSCA account (you’ll need to create one first), or get in touch with Service Canada.
Having a baby is a time of great joy, which should never be overshadowed by financial woes. To help ensure that you don’t suffer financially, maternity or parental EI benefits may be available to you. Be sure to do a little homework to see if you qualify.
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