When you are bringing a new life into the world, one of the first things you might consider is how you will be able to cope financially – in which case, you could come to the conclusion that saving sooner rather than later will stand you in good stead.  

Of course, this is a sensible attitude, and being prudent with your financial decisions while there is one less mouth to feed could mean there is more money available later when you need it most. Clothing, toys, medical bills and endless other extras can have a serious impact on your cashflow – particularly if the amount you are earning has been reduced due to maternity or paternity leave.

However, you may be wondering about the <a rel=”nofollow” onclick=”javascript:_gaq.push(['_trackPageview', '/outgoing/article_exit_link']);” href=”http://www.halifax.co.uk/savings/personalrates.asp”>best savings rates</a> available to equip you and your family for the future, but this is entirely dependent on how you see the coming months and years unfolding. For young couples planning a life together, a fixed rate ISA might be the better choice. If you are looking to have a baby in a couple of years’ time, you could find the product has enough time to mature properly, so you can make full use of the allowances available to you.

From April 2010, this means up to £5,100 can be put into a cash ISA, leaving the same amount available to be put into a stocks and shares option. If, however, you do decide to be more adventurous with your money, the whole £10,200 can be placed into the latter – but you may find the term of this investment is longer than two years. Of course, for those that like to plan well ahead this could end up being the best ISA choice, but it really depends on the individual.

If, however, you find the pitter-patter of tiny feet are coming sooner than you had expected, your plans may be slightly different. Of course, an ISA will still be a useful way to help protect your future should this be the case, but you may wish to keep some cash aside in a savings account that offers you competitive rate of interest to pay for your  more impending needs.

Finally, you may also decide starting a child trust fund now is the right thing to do, in order to maximise the amount available to your child when they reach adulthood. This facility is given a boost when opened thanks to a government voucher scheme and an additional amount will be paid on the seventh birthday of your son or daughter if the account is maintained.

All in all, the options available to new families are many. But whichever way you decide to go, the most important thing to remember is that the sooner you start putting cash away, the better off you will be when your spending priories are forced to change later.

Noel Mellor is a writer, editor and podcaster from Manchester, England. Having produced and revised copy for a number of major financial institutions, he is highly experienced across a range of economic matters. Noel’s money saving tips are especially focused around fixed rate ISAs and to find the best savings accounts.


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