Ways In Which New Parents Can Protect Their Finances

If you are planning for the arrival of a new baby to your family, it can be very exciting and a joyous time for you and all your family and friends. However, have you had the time to consider the implications that a child might have on your finances – and if you have, have you thought about how you will be able to better manage the major financial change that will come around with the birth of a baby? Between buying clothes, nappies and toys, your budget can quite easily be blown out of the water, leaving you in the red. During this time meeting all your financial commitments may be difficult. Late payments and outstanding or increasing debt can quickly start to impact your credit score and cause money worries. . The following tips may help to ease the financial burden that can come around when you become a parent…

Create A New Budget

If you had a budget before your baby arrived, then you are well on your way to managing your money effectively. Now that there is going to be a baby in the mix, the numbers you originally had are more than likely to change, particularly in the long term. From feeding supplies to childcare, having a baby can be expensive but it doesn’t mean it should be impossible. Once you have your baby and start to get a sense of how much you are spending, sit down and make a new budget that accurately reflects your expenses. It will help you to see where your money is going, and you can keep better track of where there are cost-saving opportunities.

Pay Your Bills Via Direct Debit

Particularly in the first few weeks of your baby being born, you may find that your life is increasingly hectic, and you will be juggling doctors’ appointments and a steady flow of visitors. This, combined with a lack of sleep and adjusting to a new routine, can make it easier to forget to pay your bills. All it takes is one missed bill payment to send your credit score spiralling. Your payment history counts for 35% of your overall credit score, so be sure to schedule your bills to come out automatically by setting up direct debits. It could make all the difference to your credit score and give you one less thing to organise and worry about.


While many expectant parents are conscientious and try to save up as much money as possible ready for the arrival of their baby, there may be instances where accidents or emergencies occur and they are left out of pocket. A loan could be an option for a couple, although they may want to first consider other options, perhaps borrowing money from a family member or friend. Short term loans or payday loans offer higher interest rates and are an expensive way to borrow money. It is important to ensure repayments can be made on time before taking out a loan. Most direct short term loan lenders will be able to transfer funds to a bank account on the same day, once an application is approved. Usually short term loans are used to see you through to your next pay day, so the amounts offered are normally smaller than other loan types, typically £100 to  £1000. Short term loans should not be used continuously, especially if you are experiencing any form long term financial difficulties.

Don’t Overdo Your Baby Shopping

When a baby is on the way, it can be all too easy to go on a baby shopping binge and buy all the clothes, toys, and accessories that shops are filled with nowadays. Try to differentiate between the necessities and things that are just added extras and remember that you will probably be gifted certain items by your friends and family anyway! For more handy tips, read: How To Save Money When Shopping For Your Baby.

Set Up A Savings Account

After you have reviewed your budget, now is the time to set up a savings account. You could set up an account for your baby, and set up a separate emergency savings account.

The account you set up for your baby could be used to put money from friends and family on special occasions throughout your child’s life. This can then be used to purchase bigger items that they may want, when they are ready to spend that money.

Putting together an emergency fund is always a good idea, especially when you have children involved in your life. If anything were ever to happen and you needed cash in an emergency, there would be a pot sitting there to dip in to.

When it comes down to ways in which you can protect your finances as a new parent,  it’s vital to make smart decisions with how you use your money and how well you keep tabs on your bills too. Following the aforementioned tips will go a long way in helping you avoid unnecessary problems with your cash flow and allow you to fully enjoy the introduction of your little bundle of joy into the world!

Generic advice is not a service regulated by the Financial Conduct Authority.