Bringing a newborn baby into the world is a joyous and exciting occasion, but it can also be an overwhelming and stressful time, especially when it comes to budgeting for a baby. There are so many things to consider, from preparing your home for a new arrival to figuring out how to manage your finances.
The Office for National Statistics reported that for the first time half of the women in England and Wales remain childless by their 30th birthday and the financial burden of having a baby is the main reason why many women now leave it until their 30s to have a baby.
Being a parent myself I understand that you might be feeling the pressure of all the expenses associated with a new baby and also budgeting for a baby. But don’t worry – you’re not alone!
With a little bit of planning, guidance and some smart financial choices, you can make sure that you’re ready for the costs of having a baby and can enjoy this special time in your life to the fullest.
So, let’s take a closer look at what you can expect in terms of childcare costs, and how you can prepare financially.
Budgeting for a baby means first understanding the costs. On average, new parents in the UK can expect to spend around £1,000-£3,000 on one-time expenses such as baby gear and furniture.
Ongoing expenses like diapers and formula can add up to an additional £1,200-£3,000 per year. (without childcare costs)
Here’s a list of essential items you can expect to buy before your child is born especially for a first-time parents.
The cost of these baby items can vary depending on the brand and quality you choose. These are rough estimates
Total cost: £600 – £2,040
Nice to have
Total cost £345 – £1450
Recurring buys:
Total recurring cost: £900 – £1230
Remember, you don’t need to buy everything at once – it’s okay to start with the essentials and add more items as you go.
You can also save money by buying second-hand items or accepting hand-me-downs from family and friends.
Preparing financially for a baby can seem overwhelming, but taking a few simple steps can make a big difference.
The first step is to create a household budget or family budget that takes into account the new expenses you’ll be facing with a new baby. A budget is simply planning and deciding how much you want to spend on an item.
It’s also important to research government benefits and tax credits that you may be eligible for as a new parent
Building an emergency fund is another important step in preparing financially for a baby.
During pregnancy, it’s also a good idea to think about ways to maximize your income or increase your household income and save money.
This can include taking advantage of flexible work arrangements like working from home or reducing your hours, as well as considering part-time or freelance work. You can also save money by cutting back on unnecessary expenses like eating out or buying expensive clothes.
Lastly consider life insurance. A term life insurance policy is an important consideration for new parents, as it can provide financial protection for their family in the event of the parent’s death.
Here are some specific tips for saving money during pregnancy and after the baby’s arrival:
Buy second-hand items: As mentioned earlier, buying second-hand items can be a great way to save money on baby gear, clothes, and furniture. You can find great deals at charity shops, online marketplaces, and local parenting groups.
Breastfeed instead of using formula: Breast milk is not only better for your baby’s health, it can also save you a lot of money. Formula can be very expensive, and the cost can add up quickly over time. Breastfeeding is also convenient and doesn’t require any special equipment.
Take advantage of free resources: There are many free resources available to new mums in the UK, such as parenting classes and support groups. These can provide valuable information and support without costing you anything.
Make your own baby food: Making your own baby food can be a great way to save money and ensure that your baby is eating healthy, nutritious food. You can use fresh ingredients and make large batches to freeze for later.
Use cloth diapers: Cloth diapers can save you a lot of money over time compared to disposable nappies. They are also better for the environment and can be reused for multiple children.
By following these tips and being mindful of your spending, you can save money and ensure that you’re able to provide for your new baby without breaking the bank.
Taking time off work for maternity leave can be an exciting and nerve-wracking time for new mums. One of the biggest concerns for many women is the potential loss of earnings during this time.
In the UK, eligible employees are entitled to up to 52 weeks of statutory maternity leave. However, during this time, you may only be entitled to Statutory Maternity Pay (SMP), which is paid for up to 39 weeks. The current rate of SMP is £151.97 per week, or 90% of your average weekly earnings (whichever is lower).
This can be a significant drop in income for many mothers and families, especially if they were previously earning a higher salary.
However, there are ways to help mitigate the loss of earnings during maternity leave. For example:
By being proactive and exploring your options, you can help minimize the impact of lost earnings during maternity leave and ensure that you’re able to provide for your family during this exciting and challenging time.
There are several benefits and tax credits that you may be eligible for. Here are a few of the most common:
Maternity Allowance: Maternity Allowance is a benefit for women who do not qualify for Statutory Maternity Pay (SMP). To be eligible, you must have been employed or self-employed for at least 26 weeks in the 66 weeks before your baby’s due date.
Statutory Maternity Pay (SMP): SMP is a benefit that eligible mothers can receive for up to 39 weeks after giving birth. To qualify, you must have been employed for at least 26 weeks in the 66 weeks before your baby’s due date and earn an average of at least £118 per week.
Paternity Leave: Fathers and partners of new mothers are entitled to two weeks of paternity leave, which can be taken within the first eight weeks after the baby is born.
Shared Parental Leave: Parents can share up to 50 weeks of leave and up to 37 weeks of pay after the birth or adoption of a child.
This can be taken in blocks by one or both parents and must be taken within the first year after the baby is born.
Free prescriptions. If you are pregnant, you are entitled to free prescriptions for the duration of your pregnancy and for 12 months after the birth of your child.
To claim free prescriptions, you will need to provide proof of your entitlement, which you can get from your doctor or midwife.
Dental care. Subject to long NHS waiting time. Check with a provider close to you
Child Benefit: Child Benefit is a tax-free payment that can be claimed by anyone responsible for a child under the age of 16 (or 20 if they are in approved education or training).
Sure Start Maternity Grant: This is a one-time payment of £500 that can be claimed by families who are on a low income and receive certain benefits. It can be used to help with the costs of a new baby.
Universal Credit: It is available to low-income families and can provide help with the costs of raising a child.
It’s important to note that eligibility for these benefits and tax credits can vary depending on your individual circumstances, such as your income and employment status.
You can check your eligibility and apply for benefits online through the UK government’s website.
In conclusion, preparing financially for a new baby in the UK can be a daunting task, but it’s essential for ensuring that you’re able to provide for your family and enjoy this special time to the fullest.
By budgeting carefully, taking advantage of government benefits and tax credits, and being mindful of your spending, you can help ease the financial burden of having a new baby. Remember to prioritize self-care and take advantage of free resources and support groups to help manage the challenges of a newborn baby
