Oh, baby! Money strategies to help you budget for your baby’s first year


Welcoming a new baby into the family is an exciting, happy event – but it can also bring lots of expenses too! Willoughby mum Kirsty, from mozo.com, shares her top tips for surviving that first year with money to spare!


In fact, in the first year alone, a new baby can set you back anywhere from $3,000 to a whopping $15,000 – depending of course on what you need to buy (if this is your first and you need a bassinet and pram you’ll probably run closer to the top end of the scale.)

Now, I know as well as any mother that when it comes to your kids, there’s no skimping on being safe and prepared simply for the sake of saving a few extra dollars. So, with that in mind, here are three strategies to help ease the financial strain of having a new baby in the house.

Start saving early 

One in five Aussie mums have admitted that they underestimated the cost of a baby – and I’m not surprised! Between formula, nappies, a stroller, and even maternity clothes for during your pregnancy, being prepared for everything is near impossible.

But you’ve got at least nine months to prepare to be a mum – and while that’s no small task in itself, during that time it’s also a good idea to keep an eye on your budget. As soon as you start trying for a family, think about opening a seperate savings account to start putting away spare cash for all the expected – and unexpected – bills that come along.

This is also a great habit to get into for the long run because before you know it, you’ll be tackling other big expenses that come with raising children, like paying for school fees.

Manage your credit wisely

Faced with hundreds of dollars worth of toys, nappies and clothes it might be tempting to break out the plastic, and in fact, one in ten mums copped to doing so, just to cope with the costs of a new baby.

That can be a trap – but only if you let your balance run away with you. It’s perfectly fine to use a credit card to manage your budget, just make sure you can pay it off in full and on time each and every month.

And if it’s inevitable that you’re going to wind up with a lingering balance while your budget recovers from the impact of having a new mouth to feed, you can minimise the damage by opting for a low rate card. The average credit card rate in the Mozo database at the moment is 17.12% and the lowest is 8.99% – it doesn’t take a rocket scientist to work out which rate means paying less in interest charges.

Take a home loan repayment holiday

This is a trick that not everybody knows about, but if you’ve got a mortgage and a baby on the way, it’s definitely worth approaching your lender about.

A home loan repayment holiday is an agreement you make with your mortgage lender to press pause on your home loan repayments, usually for a period of up to 12 months. It gives you some breathing space to focus on other financial commitments without worrying about paying the mortgage. Just keep in mind you’ll need to prove to your bank that you’ve got a legitimate reason to be leaving work – such as going on maternity leave.

As an example, a $300,000 mortgage over 25 years, with an interest rate of 4.00%, comes with $1,584 monthly repayments. That’s a huge chunk of change, and having it free to put towards your baby’s needs instead of your mortgage can be a great way to ease any financial strain your new family might be feeling.

Of course this does mean that a year will be added to your mortgage, but if you’ve got a home loan that accepts extra repayments or you have an offset account, once you’re back at work you can work at paying it back faster if it’s within your means.


Mozo is a financial comparison website helping Aussies find a better deal on financial products including home loans, credit cards, energy plans, savings accounts, car and home insurance and lots more! Find them in the NSM Directory.


A Willoughby local, Kirsty Lamont is a Director and money expert at financial comparison website mozo.com.au. She is a well-known personal finance commentator who regularly appears in the media talking about ways that Australians can save money and get a better finance deal. A North Shore mum herself, Kirsty is passionate about helping other women navigate their finances as they start families, raise children and progress their careers.

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