Starting a family

Step 1 – Take stock

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Now is an important time to sort out your finances, both for the short and longer term.

Start by getting to grips with your budget. Our Budget calculator will help you to work out your weekly or monthly income and expenditure and see how much you've got left over. You could also use our Financial healthcheck to help you identify your financial priorities.
If you have a partner, this might be the first time you have really had to think about sharing your money and financial responsibilities. Recent research carried out on behalf of the FSA found that almost three–quarters (74%) of British couples find money the hardest subject to talk about with their partners.
Running the household finances will be easier if you're in agreement. This doesn’t mean you have to agree on everything but it will help if you understand each other's attitude towards money. Talk it through. There's a useful questionnaire on the Relate website that will help you get started.

We don't need to tell you that babies are expensive – research shows that they can cost more than £3,000 by the end of the first year. But, if you plan for this, it will help you avoid running into debt problems.
Start by making a list of everything you're going to need to buy and see how much it comes to. Use our Budgeting and baby calculator to see how much your income and spending might change in the first year after your baby is born.
If money is tight, you might want to see where you can make savings. A good way to do this is to keep a spending diary for a week or a month. You'll be amazed where your money goes and will probably be able to see where you can make cut–backs. For more information see Saving for tomorrow.
Try our Cost of a child calculator to see how much it might cost you based on your own information.

If you do need to borrow money to cover your needs try to avoid expensive credit and loans. Some types of borrowing are very costly, for example door–to–door lenders and most store cards.
Shop around for cheaper rates at banks, building societies and your local credit union. A good way to compare costs is to look at the APR (Annual Percentage Rate). This tells you what you will pay for the loan, taking into account the interest you'll pay and other charges. For more information see What is APR? Remember, you don't have to go with your own bank or building society. Use our Debt calculator to work out the cost of borrowing for you.
When taking out a loan, you may well be offered Payment Protection Insurance, which can help you to meet your repayments if you're ill or made redundant. It's not compulsory, and you should make sure you understand what this actually covers and whether you really need it. But if you do, shop around – you may well be able to arrange a better deal elsewhere. For further information see Payment Protection Insurance.

It's also worth checking to see if you're entitled to any State benefits over and above child benefit. And bear in mind you may also be entitled to State benefits if and when you return to work. Nine out of ten families with children can claim Child Tax Credit and, if you're on a low income, Working Tax Credit can help you pay for childcare. For more information visit the Citizens Advice Bureau's Adviceguide website, and the parenting pages at Directgov.
You can also use our Tax and credits calculator to work out how much you may be able to claim in tax credits if you have at least one child.

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