It’s just like waiting for a London bus. You wait for ages and then suddenly…a stream of Hollywood stars become ‘celebrity moms’ all at once.
Salma Hayek, of Desperado fame (and SpyKids infamy) gave birth last week, pint-sized Christina Aguilera and Bond Girl Halle Berry are both expecting their first child and even our own Charlotte Church and baby Spice Emma Bunton have recently become full time mums.
Of course, life as a celebrity baby is somewhat different to real-world babydom. There are photo shoots to think about, for a start.
But whether you’re a young mum struggling to make ends meet or a super-rich Hollywood legend, having a baby is a life-changing experience. And if you’re short on cash it can be immensely stressful, too.
New research from MoneyExpert.com suggests that if you’re a new parent you could well end up in debt. On average, those who do borrow money to cover the extra cost of looking after a new born baby will owe around £1,140 a year after the birth.
Loss of income and increased costs mean many parents have debt worries to add to the sleepless nights with more than 40 per cent of parents going into the red.
And while the likes of Charlotte Church and Halle Berry will have plenty of financial support to lean on, most of us will feel the pinch as our finances are stretched to near breaking point. In fact, around seven per cent of parents with young children rack up over £2,500 worth of debts, and one in 50 will owe over £7,000 after just twelve months with their newborn.
It’s no fun when reality bites and you could be forgiven for burying your head in the sand and hoping for the best. You’ll also have seen the Bank of England putting up interest rates -adding around £200 a month to the cost of the typical mortgage.
However MoneyExpert.com can help you break the cycle of debt and sort out your finances so you can work towards becoming debt-free once you’ve sorted life as a new parent.
Typically you might have run up an overdraft on your bank account while also having a balance on your credit card and perhaps also owe some money on a store card. Some of us will have personal loans and many of us will also have mortgages on our homes to think about, too.
Cutting through the debt chains
Consolidating your debts into one loan can help you to cut monthly repayments and boost your wealth while also giving you a better chance of becoming debt free.
You can take out one loan to repay all your creditors and then concentrate on repaying that loan. This is known as a consolidation loan.
The aim should be to secure the lowest rate possible for your consolidation loan. That can mean you making lower repayments every month as you’ll cut out the expensive debts and have everything in one place.
You should also have only one payment a month and will be able to keep track of your debt.
Click on MoneyExpert.com’s Debt Consolidation calculator to see what you can save.
Finding a consolidation loan
Banks and building societies plus other finance firms offer personal loans for up to £25,000 which you can repay over periods as long as seven years. Rates range from around six per cent.
You can consider extending your mortgage and should contact your lender to see what they can offer.
Alternatively you can look for a secured loan which is secured against your house. This can be paid off over a longer period and you can borrow higher amounts. MoneyExpert.com can show you the best deals and also give you a credit check so you are only put in touch with firms which are likely to lend to you.
You should wherever possible look to pay your debts off as quickly as you can. The longer you borrow money for the more interest you will pay.
And remember it’s not an excuse
Consolidating your debt will give you peace of mind and should boost your wealth by cutting monthly payments. However it shouldn’t be an excuse to start borrowing more.
When you consolidate your debts it should be the beginning of the end of running up debts and allowing your finances to run out of control. You should not keep on consolidating and consolidating. It’s time to break the cycle and become debt free.
Consolidate your debts