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Parents' guide to money

Advice and tools on money matters from pregnancy to family life

5 tips to babyproof your finances

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Congratulations, expecting a baby is a wonderful and exciting time. It's totally normal to feel overwhelmed by the planning side but here are some real, useful tips that will help you organise your finances and help budget your money better. After all, the only thing keeping you up at night should be the baby once they arrive - not worries about money.

1. Take stock of any debts

Your first thoughts after the excitement and happiness of discovering your pregnancy may be worry about your finances. Don't tie yourself in knots worrying though, there are things you can do.

Before you start to pay for all the bits for your new arrival, have a look at any existing debts and think about how you can reduce them so you don't get caught out further down the line. Knowing how you should prioritise your debts is a great step towards reducing them. Your mortgage or rent should be on the top of the bills list, as should gas and electricity. If you owe money on credit cards, tackle the one with the highest interest rate first.

If you are struggling, don't worry, you don't need to feel stressed. You'll be able to find a solution that works for you as there is lots of free, local debt advice available so you don't have to turn to fee-charging debt management companies.

2. Organise your finances

There is never a better time than now to reappraise your financial life and start budgeting. For some couples, it may also be the first time you have had to seriously talk about finances if you are used to paying for everything separately.

Take a look at the money you have coming in (don't forget to factor in any income drops when you are on maternity leave) and your outgoings. Have a think about whether there is anything you can cut back on. Are there subscriptions you could cancel, or spending habits you could break?

If you're planning to add to your family, you may also be looking at moving house or getting a new car. It may be worth factoring in higher utility bills when you're on maternity leave, as you'll be at home more, so creating a budget is a very good idea. It may also be sensible doing two budgets - one for now, and one for when you are on maternity leave.

Most likely your household income will drop at some point, so see whether you're entitled to Child Tax Credits. If you're already claiming Working Tax Credits, make sure you update your information and income, as there's no need to claim for them separately and you might be entitled to more.

You're not on your own. Talk to your partner, family or friends about your budget and what needs to be bought. Sorting out money can always seem more daunting if you feel you're doing it on your own and discussing it can help you feel less stressed.

3. Consider what you need to buy

Buying all the things you need for the baby is really exciting. But, from cots to clothes, it can seem like there is a lot to get for someone so small, especially if it's your first. Again, the key is in planning. Take a look at the Money Advice Service's Baby Costs Calculator to get an idea of how much you may be spending on essentials.

You don't need to get everything brand new either. Babies grow and they grow quickly, so buying lots of new clothes may end up being a mistake. Why not consider buying second-hand instead?

Take the time to shop around too. There's usually a sale on somewhere. Shopping online can prove cheaper than the high street.

4. Sort out your childcare expenses

Even though the baby isn't here yet, you're probably thinking about how you will afford to pay for the cost of childcare. Well, the good news is that if your employer offers childcare vouchers, you might be able to start accruing them during maternity leave.

The amount you get depends on what level you pay tax at, but you could be looking at up to £243 a month, which can really help ease any stress when it comes to sorting childcare. Bear in mind these vouchers are a salary sacrifice, not extra money, but you will not be taxed on them. Also do keep in mind that if you are claiming tax credits, you're most likely better off not taking childcare vouchers as it affects your entitlements.

Even better, a new tax-free childcare scheme is due to be introduced in early 2017. Under the new scheme, you'll get 20% of your yearly childcare bill paid for by government. This means that for every 80p you pay in childcare, the government will put in 20p. So, by the time you may need to think about nurseries, you'll already be pocketing a bit more than you potentially could have been before.

5. Get clued up about Child Benefit

Claiming Child Benefit can give an extra boost to your income, which you can spend on any extra bits for your child that come up. You get £20.70 per week for your first child and £13.70 a week for any further children. But don't forget to claim before your baby is three months old as Child Benefit entitlements can only be back-dated for three months before the date the application is received.

If you or your partner earn over £50,000 a year, you will have to pay back some of your Child Benefit back, and if either of you earn over £60,000 you are not entitled to any. But did you know that simply filling in your claim form for Child Benefit will help you protect your State Pension? If you decide to stay at home to look after children, make sure you're not missing out on National Insurance credits that count towards your Pension.