Having your first baby: Money matters

The guide to sorting your finances when you’re expecting a baby

Tidy up your finances

The first step is a general overview of your family finances. Make sure you’ve trimmed your spending where you can and you’re saving sensibly.

Time will be tight once the baby arrives, so go through your financial ‘to do’ list now, starting with opening an ISA if you don’t have one already. It’s also important to write a will, or to adjust your existing will to include your baby. Our financial planning guide will help you get everything in order.

Know what you’re entitled to

When you take time off work to have a baby you’re usually entitled to statutory maternity leave and pay. If your partner is having a baby, you may be eligible for paid paternity leave.

Pregnant women can also take paid time off work for antenatal appointments, plus they’re entitled to free NHS dental care and free prescriptions during pregnancy and for up to a year after the baby’s born.

First-time mothers who receive certain benefits can claim the Sure Start Maternity Grant, which is a one-off payment of £500 towards the costs of having a child.

Everyone can claim Child Benefit, although if you or your partner earns more than £50,000 after tax then some of it will be clawed back in the form of a tax charge. If you’re affected by the tax charge then you can choose not to claim Child Benefit, but you should still fill in the form so that you keep accruing National Insurance credits. You should complete the form before your baby is three months old.

You may also be eligible for Child Tax Credit (the amount you receive depends on your income), and Working Tax Credit if you’re on low pay. Check the government website for more details.

Calculate the costs

Initial costs for your newborn include things like a car seat, a cot and a pram. On average, first-time parents spend about £1,000 preparing for their baby, according to a Guardian Money survey, but you can save a lot of money by getting things like cots and pushchairs second hand on eBay or Gumtree, or even for free from Freecycle.