Baby loans hit £2.32 billion over last five years

Posted on October 31st, 2010 | Categories - News

Parents take out loans to pay for the cost of caring for their babies.

Prams, baby clothes, toys and home improvements are paid for through loans by parents-to-be.

Expectant parents have borrowed £2.32 billion in loans to prepare for new arrivals to their family unit over the last five years, according to research from Sainsbury’s Finance Personal Loans.

The study showed that parents-to-be need an average of £2,890 to pay for items like buggies, car seats and nursery renovations.

Over the last five years more than 6.1 million Britons planning to have a baby have funded their purchases by taking out credit card loans, personal loans, borrowing from friends and family or using their savings.

Steven Baillie, head of loans at Sainsbury’s Finance, said: “Preparing for a new arrival can be expensive when you take into consideration costs such as buying the necessary equipment, upgrading the family car or maybe even extending your property”.

The study concluded that almost 650,000 parents and parents-to-be will borrow more than £5,000, almost £2,000 over the average figure, to pay for larger items like cars and home improvements.

Scottish parents were found to spend the most on pre-baby preparations, forking out an average of £3,690, followed by people living in the South East who pay out £3,510. Parents in the Midlands were found to spend an average of £2,510 – the lowest figure in the country.