Balancing the responsibilities of motherhood can be overwhelming, often pushing long-term financial planning to the bottom of the list. However, effective financial planning is essential for everyone, and as a mother, you face unique challenges that require extra attention. Here are some key steps to help you take control and secure your family’s future.

Save for Unforeseen Emergencies

As a mother, you’re no stranger to emergencies, and while an emergency savings fund can’t prevent unexpected sick days or school uniform mishaps, it can be a lifesaver for costly situations like a car or boiler breakdown. Having at least six months’ worth of essential expenses in an easily accessible savings account can reduce the need to take on debt or dip into your long-term savings.

Protection, Protection, Protection

If your family relies on your income to cover household expenses, childcare, or school fees, income protection insurance is worth considering. This policy can pay a portion of your salary if you’re unable to work due to a long-term illness, ensuring financial stability and helping your children maintain their lifestyle.

Life insurance is another essential form of protection. It provides a financial safety net should the worst happen to you, offering either a lump sum or regular income to help your family cover expenses such as a mortgage, giving you peace of mind knowing they’re financially secure.

Your Pension Matters

Many mothers take time off work to care for their children, and while focusing on family is important, it’s crucial not to neglect your pension. Failing to contribute to your pension during these years can have long-term consequences that impact both you and your loved ones.

If you qualify for the full amount, the State Pension offers £221.20 per week, or £11,502.40 per year (2024/25). To qualify for the maximum, you need 35 years of National Insurance (NI) contributions. If you’ve claimed Child Benefit and your child is under 12, you will still receive NI credits, even if you’ve opted out of payments to avoid the High-Income Child Benefit charge.

Topping Up Your Pension

Consider topping up your workplace or private pension to boost your retirement savings. Pensions are a cost-effective way to save due to the tax relief you receive on contributions. For example, a £100 contribution only costs £80 if you’re a basic-rate taxpayer, or just £60 if you pay higher rates of tax.

Even if you’re not working, you can still contribute up to £2,880 per year into a pension and receive 20% tax relief, making your total contribution £3,600. If you come into a cash gift or inheritance, placing it into a pension can be a smart way to enhance your retirement funds.

Wealth Creation for Your Children

If you’re in a position to save for your children, doing so can give them a head start in life, whether it’s for university fees or a deposit on their first home. Investing in the stock market can provide significant long-term growth compared to savings accounts.

Junior ISAs are a good option, as they allow for tax-efficient investment growth and lock funds away until your child’s 18th birthday.

Obtain Professional Financial Advice

Sorting out your finances while juggling family life isn’t easy, and it’s okay to seek help. Obtaining professional financial advice ensures you make the right choices for your future, giving you more time and energy to focus on your family.

Want to learn more or need personalised financial guidance?
Contact us today for expert professional advice and personalised financial support. We’re here to help you and your family achieve financial stability and peace of mind. Don’t wait – reach out now, and let’s secure a brighter future together!