How to budget for your baby’s first year
Becoming parents is so exciting, but it is costly. Here are some budgeting tips you may want to consider before baby arrives
The excitement of planning and starting a family is understandably all consuming but there are some practical things that need to be considered. The cost of raising a baby being an important one. For example, did you know that, in the UK, new parents spend an average of £11,498 during the first year of their little one’s life? But don’t worry – budgeting in advance can really help you to take care of these costs. Here are some great tips you may want to consider before baby arrives to help prepare for the cost.
Break it down
When you think about £11,498 that figure could make your eyes water, but don’t forget that the costs won’t come all at once.
There will be up-front expenses in the run up to your little one’s arrival, such as a travel system and cot. Avoid overspending on these where you can; before you make any purchases, make lists of the absolute must-haves and any extras. Then focus on the most important purchases first.
Other costs, like nappies, clothes, food when they’re weaning, are ongoing and will also need to be considered over the long-term. These expenditures can be made more manageable by reviewing your current spending to accommodate your baby’s everyday essentials.
Thinking ahead
The added cost continues as your baby grows, so it’s a good idea to think ahead. According to research, the average cost of raising a child to the age of 21 is, wait for it…. £231,843. It really can make such a difference if you start making financial provisions for their future as early as you can.
Explore the different children’s savings options available; many allow you to get started as soon as your child is born. These include Junior ISAs, which let you save long-term and, when your child turns 18, they’ll receive a tax-free cash lump sum. An unforgettable gift that could help them make their own way in the world.
And don’t forget; even saving small amounts regularly can have a big impact on your child’s future.
Click on the button below to find out more about Shepherds Friendly’s children’s savings plans including their flexible Junior ISA and exclusive Young Saver Plan. Plus, your chance to get free Love2shop vouchers.
When you take out an investment product with us your capital is at risk and you may get back less than you have put in. In poor investment conditions we may apply a Market Value Reduction (MVR).