As if the Financial Services Authority didn’t have its time cut out sorting out the mess that is Northern Rock, it has decided that new parents need help in the budgeting department. So from this summer onwards, the FSA is handing out packs called The Parents Guide to Money to prospective new mums and dads on how to manage their money, as well as tips on claiming benefits such as maternity pay and child benefit.
I imagine this could be seen as yet another example of government-related organisations poking their unwelcome noses into people’s affairs. And don’t new mothers have enough to deal with without worrying about how the financial regulator thinks they should be running their household finances? The Daily Mail has predictably already run an article suggesting the scheme could breed another generation of benefit scroungers.
But, while I can’t speak from experience as I am not a parent, from witnessing the struggles of some of my friends, surely having a baby is a very disruptive time of your life when you need all the help you can get? It’s likely that if you’re part of a couple then you’ll be struggling on one salary, possibly with maternity pay, and if you’re a single parent with a limited income life is probably very difficult indeed. Not to mention that recent research claims bringing up a child costs a mammoth £180,000.
Friends who are new and prospective mums say the benefits system is very difficult to understand. “Any guide would be useful because the system is completely confusing,” complains Helen. “I’ve got no idea what I’m entitled to claim and I can’t say I find the government websites very clear.”
Katherine, whose daughter is six weeks old, agrees. “Having a baby is so weird and so different from everything else in life that the more information the better,” she says. “I thought I was fairly financially savvy, but there’s lot to take in and you don’t necessarily have the time. There’s lots of things you can claim that many people don’t know about, and there’s probably lots of people who don’t have the internet or don’t know where to get the information they need.”
And far from seeing it as the FSA interfering, these new mums gave the guide the thumbs up. “Since when is putting out a leaflet meddling?” says Katherine. “That’s not meddling, it’s useful. It sounds like a great idea.”
“It’s obviously a good idea. I’m just irritated that it won’t be out in time for us,” complains Helen.
She also points out that, as a couple, getting used to living on a budget and relying on one salary isn’t easy when you’re accustomed to two salaries coming in. “It’s really hard for men I think especially to accept that one of you is not going to be earning and you suddenly have to change your [budgeting habits]. It’s a bit of a shock for everyone.”
And budgeting is something that, it seems to me, has sadly gone out of fashion in this society where the credit card is king.
Are you a new or prospective parent? How do you budget? Do you welcome the FSA’s guide or do you think it’s more evidence of the ‘Nanny State’?