Tips on Saving for Maternity Leave, by a Financial Expert
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Many new mothers will receive far less than their salary while on maternity leave
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The average takeaway (£30) equates to 99 nappies, enough for eight days
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Financial expert, Christie Cook, shares her saving tips for maternity leave
While it differs company to company, the majority of new mothers will not receive their full pay for their maternity leave.
For the first six weeks of statutory maternity leave, new mothers will receive 90% of their average pay.
However, after the first six weeks, new mothers will only receive a statutory payment of £184.03 per week or 90% of their average earnings, whichever is lower.
While maternity leave is only 39 weeks, research has found that 45% of new mothers actually extend this.
Due to the lower income new mothers receive, it’s important to start thinking of cutting costs down and putting money towards maternity pay.
Christie Cook, Financial Expert at Hodge Bank, discusses five ways of saving for your maternity leave:
Budgeting
“To prepare for a major life event like maternity leave, the first step is to start budgeting and cutting unnecessary expenses. Instead of spending on takeaways, for example, put that money into savings.
An average takeaway for two will set you back £30 - equivalent to around 99 nappies. This sounds like a lot, but considering the average newborn will go through 10-12 a day - 99 would last just eight days!
Save money by avoiding branded items to suit your budget and ensuring you’re sticking to your shopping list while in your local supermarket rather than getting sucked into those deals.”
Get Selling
“What better way to make room for the new addition than by selling some of your unwanted items you’ve been hoarding these past few years.
Get on your local selling sites such as Facebook Marketplace and Vinted and sell items you forgot you had. You’re going to need wardrobe space for the new baby’s clothes, nappies and accessories, so what better way to make room than by sending your unwanted items on to new homes and making some extra money in the process?”
Free Events
“Life wouldn't be a life worth living if you stayed home 24/7 to save money, right? But there are free events you can enjoy instead of spending £20 on a cinema trip or £50 on a meal.
As winter approaches, bundle up and enjoy a winter walk with a homemade hot chocolate in your takeaway cup, making the most of a crisp sunny day.
Use sites like Eventbrite to find free local events. These small savings can help you afford activities during maternity leave, like baby yoga, soft play, and swimming, which do come with costs."
Review Subscriptions
“Every few months, review your bank account for subscriptions and decide if they're still necessary, especially as maternity leave approaches. For example, if you're paying more than £30 for Netflix, Disney Plus, and Amazon Prime Video but mainly watch one, consider cancelling the rest.
Similarly, evaluate your gym membership—many streaming services offer workout videos that may be more convenient once the baby arrives, and you’ll be able to squeeze in a 15-minute YouTube routine around the newborn’s napping schedule.”
Take Advantage of Interest
“While you can’t touch a Fixed Rate ISA for at-least a year, for most people, maternity pay often decreases the further you get into your leave.
So, if you’re four months into your pregnancy and you choose to open a savings account now, then you won’t be able to touch your ISA until the third month of your leave.
However, when that third month comes around, which will be fast, you’ll not only have the money you’ve been saving each month, but you’ll also have the additional interest too.”
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