It takes women more than two years to bounce back financially after having a baby, leaving many fearful about their own financial security and nearly a quarter (23%) convinced they’ll never return to the financial position they were in prior to giving birth. A study of new and expecting parents by smart money platform, Credit Karma, found that one in four (26%) women go into debt to cover maternity leave – averaging £2,800 in borrowing – that’s a £560 increase from 2018.
Nearly a quarter (23%) of women now have no savings when they go on maternity leave, but the rise in borrowing has been accelerated by the rising cost of living. According to the study, parents who borrow are using the money to cover basic expenses like groceries (42%), bills (32%), baby clothes and supplies (26%).
In addition, women with student loans face severe interest charges on their loans whilst on leave and unable to work, which already has a significant financial impact. A new mother accrues an average of £1,770 loan interest in just six months of leave.
