How To Budget For Your Growing Family

by Emma Barlow | 30 January 2016

Watching your family grow is such an exciting time for a parent, but when bringing a third child into the world, there are more than emotions that need to be managed. Wayne and Coleen Rooney are one couple currently on this journey, having their third child this week. Even if this is your first child, and whether or not you earn as much as the Rooneys, it is important to budget carefully for your new family member.

Money Advice Service has four tips to help you budget for your growing family:

1. Sign Up

Even just getting hold of the essentials for a baby can be expensive. New parents tend to spend as much as £7,200 or as little as £1,600 in their first year according to our research. That's why avoiding buying things new is a great way to save.

You might be able to re-use items from older children if this isn't your first child. If it is though, you may be able to get hold of some second hand items by joining baby clubs, signing up to local boards such as Netmums for second hand stuff, and registering with freebie groups, like Freecycle or Freegle. They will also help you work out what you do and don't need to spend on and could save you money. The Money Advice Service's Baby Costs Calculator is great for adding up how much these essentials could cost you, and to make sure you keep on track too.

2. Maternity & Paternity Support

If you are expecting a baby and have a full-time or part-time job, you will need to consider how your income will be affected before planning time off. Make sure you read your contract or talk to your HR department to see if you are entitled to maternity leave and pay or paternity leave.

You can take up to a year off for maternity leave but will only be paid for up to 39 weeks of this - either 90% of your average weekly earnings before tax for the first six weeks, then £139.58 per week for 33 weeks after this, or 90% of your average weekly earnings for the 33 weeks, depending on which is lower. Self-employment differs slightly, as it depends on your weekly earnings and how long you have been working for - you may still be entitled to 'Maternity Allowance' though, so it's worth checking. To find out more information on this, visit the Money Advice Service website.

If your partner is having a child, or you are adopting a child or have a baby by surrogate, you may be entitled to paternity leave and pay. This allows you to take time off to support your partner. The Money Advice Service has information on finding out if you are eligible for paternity leaveand you can go to the gov.uk website to find out how to claim.

3. Adapting The Family Budget

Your family budget will need to be revised upon the arrival of a new baby. After figuring out what you can reuse, and what support is available, think about what other costs you'll need to allow for (e.g. childcare, food). It is important to identify any extra costs early; particularly if one parent has taken time off work and your combined income is lower than normal. Make sure you discuss any money challenges with your partner, as it's good to be open and supportive of one another.

Also, make sure you are aware of food vouchers and freebies from baby clubs, such as those run by the supermarkets. You may be able to free up some more money by looking at costs you can reduce or remove completely. The Money Advice Service has a number of money-saving tips for baby shopping, all of which have come from parents who have been through it.

4. Review

The Money Advice Service's Baby Money Timeline can help you remember all of the money-related dates to do with your new baby. You can even download the dates into your calendar. For example, it can remind you to review your benefits and check that you are getting all of the support you are entitled to. There are benefits for all pregnant women, such as free prescriptions and NHS dental treatment, as well as the child benefit for when your baby arrives. This regular payment, £20.70 per week for the eldest child and £13.70 per week for each additional child, can be a welcome addition to the family budget. The Money Advice Service has a list of benefits available to claim when you're pregnant or have a baby, which may be a helpful reference.