Nearly everyone worries about finances when there’s a baby on the way, but there are lots of small savings you can make that really add up. Your morning coffee for example, can cost you over £360 a year from one of the big chains – but having a cuppa at home is a cheaper option. And buying a sandwich can cost more than double the price of making your own.
Jenny Keefe of consumer website www.moneysavingexpert.com suggests haggling with your mobile phone company for a better deal, possibly saving yourself up to £600 a year. She also recommends switching your satellite TV (which can be as much as £400 a year) to a package with fewer channels or even Freeview, as most people don’t watch half the channels they pay for – even when they’re on maternity leave!
A break from your mortgage for a few months, or making reduced payments, could be a useful way of freeing up cash. Contact your lender to find out more (not all lenders offer this service). However, Caroline Hawkesley, director of Evolve Financial Planning (www.evolvefp.com) points out that you need to be aware that you’re potentially extending the duration of your debt by deferring it – for example, you could be signing up to paying it off in 27 years rather than 25.
Another option to think about is talking to your lender about re-mortgaging, where some of the property’s value is released to you. You shouldn’t do this regularly, though, and bear in mind that your home could be at risk if you don’t keep up repayments.
Making the switch
If you have debts on credit or store cards, switching to a new card with a special ‘balance transfer’ offer could be the answer. Choose a card with a cheap ‘life-of-balance’ transfer offer. The cheap rate lasts until all the debt you’ve transferred is completely repaid.
Alternatively, if you don’t mind switching regularly, go for a zero per cent interest offer, and then get a new card before the offer ends. Most cards now charge a fee of around two per cent. With both these options, never buy anything on the card after transferring the balance.
If you have several loans, Caroline suggests talking to your bank to see if there’s a way they can help reduce the cost of your borrowing. If you want to consolidate loans, Caroline recommends www.moneyfacts.com or www.moneysupermarket.com to see the most competitive interest rates. You could also consider paying off the loans with a credit card offering a zero per cent or cheap rate, if you know you can repay the debt quickly. Get more advice from your local Citizens Advice Bureau or www.nationaldebtline.co.uk .