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Financial watchdog to provide guidance to all new mothers

19/02/2008

Mothers in the early stages of pregnancy will be given guidance packs on how to manage their money.

The UK's financial watchdog, the Financial Services Authority (FSA) will distribute packs containing information on budgeting, benefits and childcare costs.

A pilot scheme involving 1,500 prospective parents has shown the system to be successful and the Parent's Guide to Money (PGM) will now be rolled out nationwide.

The packs also include a CD containing advice on the changes to families' income and spending habits after the birth of a child as well as allowing them to manage their own budgets.

FSA spokesman Chris Pond said: "Our research suggests that a lot of people are confused and sometimes bewildered by the range of things they've got to think about.

"Things like the child trust fund and tax credits, how they deal with debts and mortgages, what they should do about going back to work and what their rights are in going back to work, as well as the costs of child care."

Some 70 per cent of those involved in the pilot scheme went on to address certain issues in their budgeting, according to the FSA, while 89 per cent of respondents in the trial said they had benefited from reading the guide, notably in terms of being alerted to benefit entitlements and tax credits.

An FSA report on the trials said: "The PGM was well received by all and considered to be a new and helpful means of providing those about to embark on starting a family with all the important financial information they would need.

"Findings suggest that the PGM has a positive impact on understanding financial matters and encouraging prospective parents to take positive action to prepare themselves financially.

"The information is credited with giving greater financial confidence, especially to young and less financially well-off parents-to-be, and encourages them to search for additional information."