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How will we afford nursery?(22 Posts)
Sorry if this message sounds a little naive but very new to this!
My partner and I are currently trying for a baby, however I'm starting to get very worried about how we will afford to pay nursery fees, looking at some of the posts. Although we earn a decent income (£50000) between us if I were to go back to go work full time, I can't see how we would have £1000 a month for nursery fees plus all the other expenditure that goes with having a child. I know people on a lot less money manage to get by and in all other respects we feel completely ready to take on the challenge of parenthood, however the money issue is stressing me out a lot at the moment.
I'm hoping someone can put my mind at rest and I'm just getting worried over nothing, but would be good to know how other people have managed?
A childminder can be a lot cheaper but basically you are right, nursery is very expensive and you will have to cutback your lifestyle to afford it.
It is really expensive, but you have to cut your cloth accordingly.
I mean, your social life becomes pretty dead in the water post-baby, so that's quite a bit of beer money that you'll save.
You'll also both be able to pay the first £486 (£243 each) out of your pre=tax income via childcare vouchers. That doesn't sound like much, but it does make a difference.
It also gets cheaper after 2yrs and MUCH cheaper after 3yrs.
You might decide to go part time at work.
Childcare vouchers may be available through your place of work (up to £243 a month of your income can be 'sacrificed' for vouchers, which are then tax free, saving you around £1000 a year)
We found we spend a lot less on going out / takeaways / unnecessary stuff
Nursery, if you choose to return to work, is expensive, but it's only for a relatively short space of time.
It is very expensive
You need to save and save now and make cut backs when you have your baby
You are sensible thinking about it now when you have plenty of time to save
You should both see if your employers offer child care vouchers which go directly to the nursery (from your gross salary)
Childminders can be cheaper
My Ds was in nursery and it was basically a grand per month for 4.5 years
We have a DD now and we use a nanny as it is more cost effective for 2 children
Not falling in to the trap of thinking everything baby-related needs to be brand new and that you need every gadget on the market helps too .
Well you are going to have to make changes, but I have found that once we have got into the routine of paying nursery fees, we don't really feel the ouch as much as I thought we would. You just have to change the way you think about spending, and spend on the essentials before even considering if there is any left for non-essentials.
You and DH should both be able to claim childcare vouchers if you're both working - this means that you pay some of your nursery bill straight out of your salary before it is taxe, so you don't pay tax on that amount. The good bit about this is that not only do you save the tax, but because it comes out of your salary, you don't have the money to start with so you notice that bit less.
It can't be denied though, that it is a big chunk of money and yes you will need to learn how to budget for it.
It might be worth seeing the financial difference in returning to work ful vs part time. Also how long you take maternity leave too to give yourself time to save up.
Check with both of your employers about childcare voucher schemes (should be in the HR manual to save you having to ask anyone!).
Also actual stuff for the child - you can get very good second hand stuff, babies grow so fast you don't want to waste money on expensive clothes anyway, borrow stuff from friends and family if you can. Your other costs will go down while you're on mat leave (travel and social for example) which will also help.
MrsKitty also makes an excellent point about not buying everything brand new. We spent very little money on baby stuff as a lot was passed on to us or we bought very cheaply second hand.
Also as per MrsKitty again, you spend a lot less on socialising and meals out, etc.
Thanks for all your replies, feeling a little less stressed now!
DH and I stagger our working hours so I work early-early and he does late-late. DS is then only with the CM 8.30-2.30 rather than 8-6 which saves a lot. And CM cheaper than nursery.
How much do you have left when you paid for everything (mortgage, car, bills, debts)? We are on similar incomes and manage easily (we have one car though and don't spend much on transport).
Your lifestyle does change a bit anyway, you tend to go out less and buy less clothes until you can fit into the old ones!
Part time is not value for money at my nursery.
I must say that I don't spend a great deal on my baby, mind you, I had a lot of hand me downs and I tend to buy stuff on offer or in the sale for later.
I think where you live counts for an awful lot. Myself and my husband earn a bit more than you, and after we pay for rent, bills, travel and nursery, we have very little left over each month. Life certainly changes! I haven't been able to buy anything for myself (or anything much at all really) for over a year and we have no social life at all anymore! Eating out? We've been able to do it about twice in the past year, and only Pizza Express. The childcare vouchers only save us £50 each a month, which is something - but you don't tend to be too grateful when you're paying £1k a month. BUT, we're happy, we don't stress too much and my son adores his nursery (and I adore being at work)!
We've just bought a house which we are in the process of doing up, so once that's all done, I suppose we will have quite a bit extra, although we do have two cars which we can't do without unfortunately. I suppose, you just have to make it work somehow! Many thanks everyone for putting my mind at rest!
A nanny share would work out far less expensive than a nursery.
Def look into a childminder. I am one and I charge £30 a day for a 10 hour day so full time all month is 'only' £600.
Plus maybe family will be able to help?
It is very good to think about it now and try to be organised but people always say 'you will just cope' and as much as you think you won't, you do!!
childminders round here charge way more than my nursery and often bizarrely expect you to supply your own food (which seems far too much hassle for me and also I like the idea of everyone sitting down together to eat the same food at the same time)
I pay £32 a day for 10hrs in a wonderful nursery
Blimey where do you all live? I pay £55 for a 10 hour day with my CM!
Just a quick message to speak to your colleagues about the child care schemes that your work has. My company for instance offers a salary sacrifice scheme for childcare costs - basically the same as the normal government vouchers but without the normal £243 limit. That means all of my fees are paid without tax and NI (saves me about £270 per month on fees of £820).
Also, everyone is right about buying things second hand. Have a look at the NCT website - they have "nearly new" sales which are excellent (seriously, had I known when I was pregnant what I know now, I would never have paid for new items) and keep a look out for notices in your library / local area etc for toddler group sales.
As others have said, it seems like a massive chunk but if you make changes elsewhere, you'll cope I'm sure.
It's only really difficult for the first couple of years, then the funding kicks in and things get a little easier.
Going part time definitely helps. If you go down to 3 days a week (for example) you don't lose 2/5 of your income because of the different in tax that you pay, and if you get childcare vouchers out of your gross salary it reduces the amount of tax/NI you pay even further.
Have a check on a salary calculator and see what the difference in take home pay would be.
If you can't do part time could you stagger your work hours, so one of you does drop-off and another the pick-up. This can reduce costs considerably.
Our CM is £45 for a 10 hour day. Haved you looked locally to see how much childcare costs in your area?
The advice others have given is good, we saved for 2 years before having DD so we had some money to fall back on when things were tight. Childcare vouchers are great as well if your firm offers them.
Day to day costs (apart from childcare) are not that much. I spend about £6 on nappies per week and DD is 16 months and she eats the same food as us so there's hardly any extra cost there. Clothes can be bought cheaply from supermarkets and even shops like H&M aren't that expensive. I spend about £100 on new clothes and shoes for DD every 3 months but if you bought second hand it would be even cheaper.