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Pregnancy, maternity and…debt. Can I afford to have a baby?

Finding out that you’re expecting a baby should be an exciting time. However, it’s totally normal to feel a little trepidation as well, particularly about your finances – and especially if you’re already struggling to meet all your monthly outgoings and pay off your debts.

Once upon a time the standard advice might have been to pay off all your debts before trying to start a family. Of course, that’s still the ideal situation, and if you’re in so much problem debt that you’re regularly struggling to make it to the end of the month, then now might not be the best time to get pregnant. But for many people looking to have their first child – particularly couples or individuals who have student loan debt – waiting until you get out of debt completely means waiting until your options for having children are much more limited, or never having kids at all.

If you want to get an idea of whether it’s financially feasible to start a family right now – or if you’re already pregnant and wondering how you’re going to manage – don’t panic! We’re here to help. Read on for our tips on getting your pre-baby finances in order.

Make a budget

Make a budget

Start by looking at your current income and expenditure. It can be difficult to get a realistic picture of your day-to-day spending if you don’t normally record it in detail, so try keeping a comprehensive spending diary for a fortnight and then using an online budget tool. You may be able to identify areas where you can cut back (see ‘Start saving’, below).

Next, add in the extra baby-related expenses you’ll have. These include one-off ‘startup costs’, like maternity and baby clothes, and equipment like cots and car-seats; and then the ongoing costs of having an extra mouth to feed. Factor in any state and/or employer benefits you’ll be entitled to, and any loss in income that you and/or your partner are likely to experience if you take parental leave.

To get a realistic idea of what you’ll need and how much it will cost, ask other families – friends, relatives or contributors to online message boards – if there are items they bought for their new baby and never ended up using. You can also hit up the same sources for secondhand goods, which parents are often eager to sell or even give away. Check the retail price for new items before you buy secondhand, to be sure of getting a good deal.

Make a plan (but expect the unexpected)

Now that you have a better idea of your overall financial picture and how much parenthood is likely to cost you, you – and your partner if applicable – can work out how to approach this new stage of your lives. The sections below list some of the steps you might want to take. Is it realistic to save up and/or pay off some of your debts – or even enter a debt solution – before you start trying to get pregnant? Can either of you pick up any extra income now? Would one or both of you take time off work when the baby arrives, and how much would that dent your income? How are you all going to get around? What’s your plan for childcare: does your employer offer any financial help, and/or are there any relatives who can help you out?

Bear in mind at this stage that you can’t plan for every eventuality. You could very easily work out the perfect budget for your first baby, only to discover that – for example – you’re actually expecting twins. Just do your best and try to include a financial cushion in your plans.

Start saving

Going through your budget as you did above should have helped you identify non-essential outgoings. Cutting back on some areas of your non-essential expenditure now – for example, a gym membership, magazine subscription, or that old budgeting staple: a daily Starbucks habit – will help you to adjust to your tighter post-baby budget while helping to build up a savings buffer to help you pay those one-off expenses and get through a temporary period of lower income. Online parenting communities are full of tips to help you save.

Put your savings somewhere you can get to them when you spot a baby bargain, but where you won’t be tempted to dip into them for those non-essentials: for example, get a high-street savings account without an ATM card, so you’ll need to transfer the funds over before you spend them.

Borrow responsibly

If you’ve got your debt and spending under control but need a little short-term help with some of those upfront baby costs, you could consider taking out a loan from a firm known for lending money responsibly. But don’t be tempted to go into tons of debt just to pay all the latest fancy baby gadgets – stick to what you and your child actually need and can reasonably afford to pay for, even if you need a while to pay it off.

Make extra income

Make extra income

First make sure you’ve checked everything you’ll be entitled to once the baby arrives or you go off on parental leave, and that you’ve incorporated this extra income into your budget. If you’re still struggling to save up everything you’ll need, try to pick up a little extra income now, before your time becomes 100% taken up by being a parent. Can you ask for a raise at work, or extra shifts? If you’re self-employed, can you pick up a few extra clients? Is there anything lying around the house that you could sell? (Don’t forget, becoming a parent is a huge lifestyle change: are you really going to use those skis in the next few years?)

If you need help

If you’ve tried all the tips above and it still doesn’t look like you can afford to be a parent until you’ve paid your debts off, then it might be time to try a debt solution. Look online for sources of free debt advice, and explain the situation to your adviser including any time constraints.

Becoming a parent is a big and scary time that involves a lot of big and scary decisions, but don’t worry – you can do this!

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