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Making Up A Shortfall

Making Up A Shortfall
A new baby in the house is a source of joy, but the unexpected expenses that often accompany the new arrival are anything but.

In fact, a baby can put a strain on the finances of even the most financially savvy parents. Budgeting account provider thinkmoney did some research to see how people would cope with an unexpected £200 bill - whether it's caused by a new arrival or not - and to establish how good UK residents are at managing their finances.

Overall, one in six people admitted that they would have to borrow money if they had to make a £200 payment out of the blue. This is equivalent to 8 million men and women. In addition, one in five respondents to the survey (more than 10.5 million people) said they would be able to find £200 at short notice - but would have to make cutbacks elsewhere. Meanwhile, 9% conceded they would have to borrow from friends and family to pay a £200 bill - and 8% said they simply wouldn’t be able to cope.

Across the UK, it seems Scots are the best at managing their day-to-day budgets - 34% told thinkmoney that they could easily find £200 for an unexpected payment. Just 12% of respondents from Northern Ireland and the North East of England said the same. One thing that can help is better budgeting. When people keep a close eye on their finances, it should be much easier to see what they can afford to spend - and what they can afford to set aside each month for any unexpected expense.

thinkmoney.co.uk, who provide an alternative to a bank account,
mum and baby
try to take the hassle out of managing money by making sure bills are always paid on time. It works like this: each customer's wages and other benefits or credits are paid into their thinkmoney account. thinkmoney then sets enough money aside to cover regular bills and commitments. The balance is transferred to a separate account - so customers can spend it in the knowledge that their essential payments have been settled.

Of course, regular bills are one thing, but unexpected expenses are another. There's no 'magic bullet' that can ensure there's always enough for those unexpected bills - but the better you understand your monthly budget (and the more you can set aside for a rainy day) the easier it should be deal with them when they do pop up.

This article was provided by ThinkMoney.
November 2013

Consumer Intelligence questioned a nationally representative sample of 2,149 adults aged 18 and over between 11th and 14th September 2013. Figures have been extrapolated to fit ONS 2013 population projections of 50,371,000 UK adults.

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