Plan a baby and do not worry about your financials

Parenting gets a lot of uncertainty along, but one thing that positively significantly impacts finances. It is always beneficial to budget your finances before the baby arrives.

Once the baby arrives, you will get lesser time to pay attention to your finances and manage them. Your baby will require all the attention, so make sure to set your financial limits beforehand.

Many people are unable to afford the post-baby expenses and decide to borrow loans. Many direct lenders offer loans at reasonable rates that require no guarantor and no broker. These lenders also offer “very bad credit loans” that cater to people with bad credit history. 

It is crucial to managing your finances properly to avoid borrowing debt and control within your limits. Here are some tips that you can use to manage your finances and create a budget for your baby and your family’s safe financial future.

1. List relevant information

Before you start with any financial budgeting techniques, list down all the essential financial information. Having all the information in one place will help you analyze your finances and make strategies accordingly.

You can plan your financial budget for the months to come to save and spend as per your budget. It will be useful to have your recent and previous bank statements, including details of all your investment schemes, savings, etc.

• Current financial situation

Maintain a record of your financial statements over the last six months and work out on an average. This way, you can create a financial budget until your baby arrives.

Include all your expenditures while calculating your past finances. Your expenditures may include all your outgoings such as rents, travel costs, debt payments, groceries, medical bills, etc.

You can opt for the primary way, i.e. calculating the total expenses and subtract it from the total income to have a clear picture of the current disposable income available for you during this pregnancy phase.    

• Find ways to cut down expenses

While creating a financial budget, always look for ways to cut down on your current expenses. You can make short term savings by reducing your costs.

When collated, these savings will help you cater to some more significant and unexpected expenses once your baby arrives. You can cut down on some minimal daily costs such as a daily coffee at lunch or a not necessary Netflix subscription.

Also, be cautious about your electricity bills. Switch off unnecessary lighting and energy points when not in use. These small steps will help you to save a substantial amount.  

• Redeem the benefits you’re entitled to

If you are planning a baby, there are many benefits that you are entitled to. To ease off your burden, you can claim all your benefits. 

There are few schemes for the new parents by the government that help to bear them with a new child’s cost. These schemes come with certain benefits and can be redeemed once you enter parenthood.

In some countries, you can apply for the Pregnancy and Baby Payment, which pays for your first child and your second child.

• Create a monthly budget

Now with all the financial information available to you, you are in a position to create your budget for pre and post-baby. You have to consider all the possible costs related to your babies, such as buying a pushchair or a car seat.

Now you have all the information you need. You can create a budget. Once you have counted all your expenses, it is easier for you to calculate the final leftover income.

Along with a monthly budget, you can set up a child investment fund that will give you’re a good return. Also, you can open up a savings account that offers you good interest.

• Factor in childcare costs

As parents, if you plan to return to your work, you need to consider the childcare costs in your monthly budget. In the case of free family help available, it is a boon to you.

In case of no other help, you have to include the costs of a nanny or a nursery or a babysitter to look after your baby while you are away at work. Fortunately, some of these costs are taken care of by the government.

Some of them include free childcare for specific hours per week. Also, there is a benefit of tax credits and tax relief on childcare.

• Plan ahead for a mortgage

It is an excellent time to watch your babies grow. Eventually, they grow, and you may need a separate space in your house to accommodate everybody comfortably.

During your maternity or paternity, it may be difficult for you to be accepted for a mortgage.

To be accepted for a mortgage, you need to produce enough proofs to prove your mortgage affordability while going on maternal or paternal leave.

• Stick to your budget

Once you have set your budget, it is essential to stick to your budget and follow it religiously until there is no emergency. While developing the budget, you have to be realistic and practical.

You should be clear in your approach to managing and tracking your money. To track your expenses and finances, you can take the help of various apps available online.

These apps are credible and make your task easy by presenting you with set templates. These templates include sections to record your financial incomings and outgoings and give an overview of your financial situation.

Description: Read these tips to manage your finances if you are planning to have a baby.

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January 31, 2021