As you become parents, the whole of your attention diverts to creating a bond with your baby, and you are likely to fall off your budget. No wonder your expenses will add up when they pair with childcare needs. This is the time when your debt may be a bit higher. So, it becomes more essential that you are careful with your finances.
The burden mounts up if you are a single person to earn and you have only one source of income. Childcare expenses cause a lot of strain on your pocket while you have to arrange funds to pay your mortgage and other kinds of debts. Thankfully, budgeting can give you a clear idea of how much you need every month.
When you have a spending plan, you will spend as per your affordability. Before you create a budget, you must know that how much it costs to have a baby.
You should start building you budget from the very first day you get news that a little cute baby is about to come in your life. You need to figure out how much you need to save by understanding what your health plan covers.
Try to build emergency cushion to six months’ worth of living cost. A variety of overlooked expenses is out there that can cost you an arm and a leg. These funds will support you then. Here is how you should prepare a budget.
Estimate medical costs
The cost of new birth shocks parents, especially those who are becoming parents the first time. Medical bills will include your routine checkups, obstetrician fees, ultrasounds, other medical tests, and after the baby arrives, postnatal care, paediatrician visits. You must have a plan how you will manage to meet these expenses. Start saving money before your baby comes in the world.
Clothes for the baby
Newborns experience sudden growth. Shelling out money in baby’s clothes is not a wise option at all. Sometimes parents buy winter clothes to find that their infants have outgrown it by the time the winter actually arrives. Do not spend money in buying branded and expensive clothes.
Even if they wear branded clothes, they will look regular as they spit. Try to choose unisex shades and colours. What if you plan your next baby? Would you like to spend money in clothes again? These hand-me-downs would be a useful option for your second child.
Prepare for a temporary loss of income
You are not going to receive a regular paycheque during maternity leaves. Further, some employers do not follow this policy as they cannot wait for such a long time. Your expenses will not go down as you lose your income source. It is always advisable that you start looking for a freelance work. At least a part-time job will support you unless you land a new job after having a baby.
If your partner is the only breadwinner in your family, circumstances can be more complicated. He can also lose his job due to any reasons. Managing regular expenses become very tough during unemployment, let alone childcare needs. Make sure that you have put aside enough money to avoid being caught off on the hop.
Well, whether you both are earning or your partner is only a breadwinner, you need to brace yourself for temporary loss of income. It is better if you have income from other sources like house or property and investments.
Save on daily essentials
Your baby will need six to 10 diapers a day, which can cost you around £80 a month. you will need to buy diapers, formula, wipes and other essential items for your baby. Try to subscribe for reward programmes. There are online stores providing at least 5% discount on such offers. You can get access to other daily essentials for your baby at discounts. All you need to do is to subscribe.
Set up a baby registry smartly
You will be very excited to prepare a list of baby products, but the rule of thumb says that you do not need to bombard your baby with endless items. Try to stick to the necessities like a stroller, a crib, a car seat, diapers, and other important items. Your cousins and aunts can help you if you are not smart enough to scan items you need for your baby.
The bottom line
Budgeting after becoming parents is crucial. Short term loans such as no credit check loans and guaranteed bad credit loans with no guarantor from direct lender in the UK can help you tide over if unexpected expenditure pops up, but it does not mean that you can manage your finances without budget.