Getting your finances in order before maternity leave — AD

Taking maternity leave can allow both you and your partner to enjoy spending time at home with the baby.

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In the UK, you can share parental leave between both parents. You can choose to both be off at the same time or for you to take it in turns to be off at different times. However, you need to be organised to get this into writing with both employers if required to allow for necessary provisions to be put in place to allow for your finances to be supported as they would with one sole parent taking maternity leave.

Many parents are rightly concerned that they will cop financially once one or both parents are off work once the baby has been born. Statutory maternity pay lasts for 39 weeks and comprises 6 weeks of 90% of your average weekly pay before tax and 33 weeks getting either £151.97 a week or 90% of your average weekly pay (before tax) – whichever is less.

To account for any potential drop in wages, it is quite within your rights to ask for any holiday pay you have accrued to start at the beginning or end of your maternity leave. Or both, as you still accumulate holiday pay when you are on maternity leave.

Preparing Your Finances For Maternity Pay

Planning for your maternity pay needs to be as soon as you are pregnant, if not before. If possible, use the disposable income for a rainy day fund that you can use to live off maternity pay if you are expecting to lose a lot of money during this period.


Taking stock of your income and outgoings is vital to help you assess where all your money is going and what you can cut back on before you need to.

Try looking at your minimal basic outgoings, and then one with a bit more flexibility, such as with streaming subscriptions etc., for those long days and nights at home with a newborn. This can help you to see how well you will manage your new budget before your income changes.

Pay off Debts

The less you have to pay for maternity pay, the better. If you can, look at what debts you can pay off before leaving for your maternity to reduce bills and debts to avoid falling behind on payments. One thing to remember is that if you have savings, you are earning less interest on your savings than you are paying on credit cards or loans. Using savings to pay off debts will save you money on paying interest to put back towards your savings.

Set Spending Limits

If you have a joint account, then you will be able to see each other spending easily. If not, you might want to go over some spending guidelines to help you acclimate to living off less for money, even for a short duration. While there are bound to be expenses you need to pay, frivolous spending can be an area to limit so that you can put their money towards other expenses or savings during the pregnancy.

Try to avoid paying full price for items and use discount codes or cashback sites to help save or earn money while you shop.

Buy The Essentials As You Need Them

There will be times when you see a great offer and splurge on it to ensure you can take advantage of great prices. When you have a baby on the way, stocking up in bulk is a great idea. However, try to avoid buying too much ahead of time. Try only to buy what you will need a few months ahead of time. For example, make a complete list of baby essentials and divide it up by age. So think of newborn items at first, then introduce age-appropriate toys or accessories as and when you need them. This can reduce what you are spending to prepare for the baby and avoid storing items you might not even need down the line.

Practical Gifts

If you know there will be times you cannot afford or prefer to use, you can compile a baby registry to allow people to buy items. People love to be generous and buy gifts for new arrivals, and using this to your advantage to buy useful items can help you reduce how much you need to buy. Be considerate when coming to a gift list for your new baby, and try to stick to items you need rather than gimmicks or gadgets that you might not even use. Gift vouchers for children’s retailers or stores that sell baby essentials can help you put many towards the cost of big purchases, as can gift cards for supermarkets and high street retailers for you to cash in when you need them.


If you will be experiencing a drastic drop in your income or your maternity pay isn’t covered by your employer due to the number of hours you work you need to ensure you have applied for any benefits you are entitled to for the duration of your maternity leave.

Some of the benefits include;

  • Free prescriptions and dental care for pregnant women lasting until the baby turns one.
  • Statutory Maternity Pay – average earnings of at least £120 per week, and been working for your employer for at least 26 weeks.
  • Maternity Allowance –  if you haven’t worked for your employer for long enough, you’re self-employed, your average pay is less than £120 per week.
  • Working Tax Credit/Child Tax Credit – for new claims, you will be directed to make a Universal Credit claim; if you still receive tax credits, you can inform them of this change so they can accurately adjust your benefits.
  • Employment and Support Allowance
  • Income Support
  • Healthy Start Vouchers for those on low incomes will start once your baby is born.
  • Child Benefit – for people who earn over £50,00 a year, you may be required to pay some of it back in your income tax. Child benefit is £21.15 a week, payable every four weeks for the oldest or only child.£14 a week for each additional child.

Take On A Side Hustle

This won’t work for every family, and as every pregnancy is different, some may not find it possible to allow for starting a new money-making venture when pregnant. But if you feel like you might be struggling financially once your maternity pay starts, use the time you are pregnant or before you get pregnant to see if you can start a new income stream to allow you to put money away to help you manage while you are off work.

Ideas include assessing your skills or knowledge to help you to use them to diversify your income. Ideas include;

  • Starting a blog
  • Creating a pregnancy social media account(s) that you can monetise
  • Copywriting
  • Proofreading
  • Editing
  • Freelance Graphic Design
  • Private lessons in a discipline, musical instrument or language

Remember, you need to declare any additional earnings to HMRC, and you will be liable for tax on earning over the £1,000 threshold. Plus, your maternity pay may restrict you from continuing this once the baby is born, meaning you have to stop working as you would in your day job.

It can be difficult to adjust to a drop in income once your maternity pay starts. Taking the appropriate steps before you get pregnant to boost your finances or during your pregnancy can help you put money aside to use should you require it once your baby is born. After all, the last thing you want is to find you have overspent and are struggling to afford to live further down the line.

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