Childcare shock

what are we missing?

Same as me and my DH - family who can look after DC. I’m very jealous of people who can just leave their DC with Grandma (quite a few people I know) - it’s quite upsetting sometimes to think about how much money they’re saving in comparison to us.

I think this is something you should have researched before you decided to have children. The majority of nursery workers only get paid the minimum wage so, in my opinion, childcare costs are too low- around the £5 an hour mark, compared with £40+ which some may spend at the hairdressers/nail bar or on fags, without question. Your children are worth more than hair and nails or fags. This is just for example.

Childcare is really expensive, it always has been. Private nursery near me is £50 per day, commute £15, after school club £15. That's pretty much my day's earnings.

There are a few ways to.minimise costs though.

1. Look into how much tax free childcare would save you.
2. Are you entitled to any universal credit / tax credits to help? Threshold is usually around £28k household income for first child (circumstances depending).
3. Look at different working patterns to minimise the amount of paid childcare you need. (my dp and I both have a weekday off each for that means we only need 3 days childcare).
4. Can grandparents help out at all?
5. Start saving now!

I hate the thinking that childcare comes from the mother's wages. You are both parents and you both pay for childcare. I hope this way of thinking isn't going to spill over into the rest of being a parent, one parent making sacrifices isn't fair.

Childcare vouchers and tax credits are both irrelevant now. People already getting them can continue. But you can't sign up for either any more - new parents will get tax free childcare or universal credit.

Can either of you start early/late to reduce the hours needed. Could either of you get childcare vouchers through your employer? Check if you are entitled to any benefits

But why is she or the previous poster the one who has to consider going back to work if both partners earn the same?!

And if they earn the same and she goes back to work, then they both need access to the same disposable income which would not happen if 70% of the income came out of her salary (based on the assumption that it is her ‘choice’ to go back to work...which is incorrect. If both roughly earn the same it is also HIS choice not to become a SAHD).

Does your partner want to go back to work?

The time to look into the cost of childcare and what having a child would mean for your finances would have been before conception. Not after!

Well if BOTH parents earn the same, and it’s 70% of one parent’s income it IS sexist to assume that it should come out of the mother’s salary or that she should stay at home. Especially given that her career would have had a break thanks to maternity leave anyway. So it is important to know how the household ‘joint’ income works and not assume that the solution is for one parent (almost always the mother) to stay at home.

But seeing it as a joint expense doesn't magically add money to the equation. It's a pointless "feminist" dig that doesn't help anyone.

Umm no, it doesn’t add money to the pot, but it makes it pretty clear that it isn’t 70% of the money there is to work with. It might be one person deciding whether to go back to work but the total money pot is taken into account (or should be) when paying For childcare. If she goes back to work, she isn’t just paying childcare and being left with 30% of her salary, is she? Or if she is, fucking leave him pet and don’t have anymore of his children.

Work compressed hours or one of you does part time around the other so you don't need to pay for child care. This is what my husband and I did when we had our second child.

Shop around for child care providers. Nurseries where we live can be up to £15 per day more expensive than childminders.

Do you have any family nearby who would be able to help out at all?

There are also tax incentive schemes and look at if you are eligible for any tax credits, which I'm guessing you may be if child care is really 70% of one salary.

Our youngest is leaving ft nursery this month. I stupidly totted up all the money we've spent on nursery since the DC started and it came to £120k. I could have bought a ferrari or a holiday home for that 😂. I have friends in France that are horrified by our childcare costs as theirs are heavily subsidised. OP get all your tax credits for now and at 3 you cab get the (sort of) 30 hours a week. I say sort of because its only for part of the year and only for some of the care so not actually 30 hours. It's been a very tight few years I can tell you but I'm hopeful we'll have a better life now.

Don’t forget to include child benefit if you are entitled to it.

OP you asked for tips, there are loads here
www.moneyadviceservice.org.uk/en/categories/having-a-baby
and here
www.moneysavingexpert.com/family/baby-checklist/

For example our childcare costs are 2/3rds of my husbands income as he earns less than me..... we had to weigh up whether it’s worth him working or being a SAHD

But seeing it as a joint expense doesn't magically add money to the equation. It's a pointless "feminist" dig that doesn't help anyone.

Also in the real world not everyone has a job that offers career progression.

Yes it's a household cost. However if it's a choice of one parent in employment Vs 2 parents in employment + childcare costs , its pretty obvious a consideration is whether the second salary covers the childcare bill. Not the only consideration but a major one.

OP- look at tax free childcare, look at whether you get child benefit (if one of you will stay at home you should claim it regardless even if you don't take the cash. This helps prevent gaps in your national insurance history). Look at alternative childcare options eg childminder Vs nursery Vs nanny share.
I also agree with pp about thinking about the longer term view , especially with the 15 hrs of 'free' childcare from the term after your child is 3.

I think the Op is just highlighting 70% is a lot.

But it’s not 70% because it’s coming out of both their becomes combined so it’s a lot less than 70% of their income.

@JoxerGoesToStuttgart because as a couple they are clearly trying to work out if it’s worth them both working. I’m having the same on-going conversation with my husband at the moment, his salary is irrelevant in the conversation because he will be working full time whether I go back or not, so the conversation is how much of my salary will be used to pay for childcare vs not paying anything for childcare because I’ll be at home with them. (We have 3 kids so it’s more like childcare is taking 98% of my income 😫)

Presumably because she is the one considering whether or not to go back to work hmm

Which, if she does, still means it comes out of both salaries. It’s a joint expense.

Have a look at the government tax free childcare incentives. This replaces the old childcare voucher scheme.. www.gov.uk/tax-free-childcare

Essentially for every £8 you pay the govt will give you £2, up to £500 every three months - 2k a year.
So it does help a little bit.

I think the Op is just highlighting 70% is a lot...... rather than it will just be his other half paying for it.

Presumably because she is the one considering whether or not to go back to work

OP I think what it comes down to is where your other half wants to be in 5 years time. Might be worth sucking up the costs for the sake of career progression or not worth it because she could pick up a similar enough job later on.

You have to think of it as a ‘joint’ cost. What % is it of your salary? Also 70%?
And yes it’s expensive but you have to sort of suck it up till the 30 hours of childcare kicks in at 3+ when you get some relief and then when they start school. If either of you can work 4 long days (which is what DH and I did for a while) then your baby needs to be in childcare for only 3 days. Currently I work 4 days and DH finishes early on 2 days (and makes up for it in the evening). This way our kids (well kid, the older one is in school) is not in childcare for 50 hours a week.

You might be entitled to help with childcare costs via Universal Credit (if joint income is under the threshold) and if not you can apply for Tax Free Childcare.

As PPs have said, when considering the financial benefits of being a SAHP v returning to work, it is important to consider loss of pension contributions and future earning potential.

Who is the higher earner or is it roughly equal?