Financial planning for new parents
So you’ve done the family planning part, now it’s worth taking time to think about planning your finances too. Having a baby is life-changing, but it’s also a huge financial commitment. According to an Aviva survey, parents with children aged between 0-5 typically spend over £7,000 a year on essentials and indulgences for their little ones. That’s £35,000 over five years.
Getting on top of the finances now can keep the costs down and help prevent any surprise financial shocks once your baby arrives. Here are some tips to get you started.
Budgeting for a baby
One of the biggest challenges you may face is suddenly living on, effectively, one salary. Perhaps it’s time to think about tightening the belt. Look at what you can live without and make sure you’re really only spending on the essentials. Also, think about what new items a baby needs – nappies, clothes, a buggy. These costs can quickly mount up, but there are some ways to save money.
Baby budget hacks
See what you can borrow – You’ll only need a crib for a couple of weeks so why buy new? And babies will outgrow their clothes in no time.
Buy second hand – Check out the many online sites of used and nearly new cots and toys. Mumsnet, Gumtree and Facebook selling pages are popular.
Use vouchers – Save money on various products and services by signing up for websites with discount vouchers.
Saving for the future
Many parents are surprised by how quickly their children grow. One minute they’re taking their first steps, and before you know it they’re taking their first driving lesson. Raising a family is full of precious moments. It’s also a long-term investment. On top of clothing and food expenses, there may be school fees and university costs to think about. Right now, these things probably seem impossibly distant, but it’s never too early to start build
Protecting what’s important
As a parent you’ll do anything to protect your kids. Yet according to an Aviva family finances report, many of us haven’t put plans in place in case anything happens to either parent. This is partly because it’s an uncomfortable subject to think about. But there are some easy steps to tackle it.
Your family protection to do list
T_a_l_k_ _a_b_o_u_t_ _i_t_ _– _once you broach the subject it becomes less emotional and more practical.
C_h_o_o_s_e_ _a_ _l_e_g_a_l_ _g_u_a_r_d_i_a_n_ _– _it can be anyone over 18, so a family member or a close friend.
M_a_k_e_ _a_ _w_i_l_l_ _– _this is the next step to making your plans official.
C_o_n_s_i_d_e_r_ _l_i_f_e_ _i_n_s_u_r_a_n_c_e_ _– _it gives you added protection, for example Aviva offer £15,000 free life insurance for 1 year to each parent with a child under 4 years old.
G_e_t_ _e_x_p_e_r_t_ _h_e_l_p_ _– _it’s worth talking to a solicitor or financial adviser, and they may be cheaper than you think.