I used prefolds and covers for newborns and one size pocket cloth diapers for 2 months and up. Indian prefolds work the best IMO because newborns are heavy wetters. I started off with some cheap china-made pocket diapers from ebay but after buying my first WAHM (work at home mom) diaper from the hyenacart site, I sold them all and bought those. They're more expensive but are better quality.
It costs around $1,500 to buy disposable diapers and wipes for two years and I spent $500 total for my cloth diapers and wipes. I also sold them all when I was done in the Cuties with Cloth Booties group here at cafe mom and on ebay and made most of my money back. My water and electric bills did not go up at all for those two years I was washing and drying diapers either.
You do need to spend money at first but it really does save you money over time. I bought a few here and there while I was pregnant in order to build up a 'stash'.
at 1:06 PM on Jul. 16, 2013