The baby debt trap

  • New parents run up £1,140 debt in the first year, research shows

Parents of children under 18 end up an average £1,140 in debt a year after the birth of their first child, new research* from says.

Loss of income and increased costs mean they have debt worries to add to the sleepless nights with more than 40 per cent of parents going into the red, the independent financial comparison website’s figures indicate.

The average debt after a year is £1,140 parents say but some plunge even further into the red – around seven per cent rack up over £2,500 worth of debts, and one in 50 will owe over £7,000 after just twelve months with their newborn.

The research shows 39 per cent of couples suffer a loss of earnings following the birth of a child as one partner often has to give up work or reduce hours worked in the first months after a child is born.

And three quarters of parents who suffered a loss of earnings look to cover this elsewhere, with family the most popular place to turn – over a quarter (28%) got financial help from family. Over one in five (22%) used credit cards and 10 per cent took out a loan to cover this loss of earnings.

Sean Gardner, Chief Executive of, said: "For most of us worries about money go out of the window with the joy of having a baby. It’s hard enough coping with the sleepless nights and new responsibilities without thinking about budgets.

"But financially a new baby can cause havoc because of the combined burden of extra costs and reduced income.

"If money is already tight, it’s no wonder that so many families have had to turn to borrowing to make ends meet. There are obviously increased costs so debt is often a sensible way to tide you over.

"However the most important thing under those circumstances is that you choose the most appropriate form of borrowing for you."’s Debt Index shows more than 2.48 million adults are very concerned about their ability to keep on top of their debts as recent interest rate rises start to hit home.

What next?

  • Consider a 0% balance transfer credit card
  • Try MoneyExpert’s debt consolidation calculator and see how much you could save each month
  • Compare over 2000 personal loan rates

*YouGov interviewed 2,511 GB adults (18+) online, between 7th and 11th September 2007

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