To wonder how people afford a 2nd child?

[ScruffleCake]

We have just found out we are going to have our 2nd baby but now going through finances I am wondering if we can even afford to keep the baby How do people afford to have another one? I thought we were both decent earners, my DP earns £24,500 and I earn £28,000. I know we live in the south-east where living costs are higher but I still see plenty of 2 children families around.

Our breakdown of our incoming & outgoings are below. The Bike loan will be up in 2 years (DP uses it to get to/from work) and the childcare is based on both babies going into care 3 days a week (assuming our parents will be okay looking after 2 babies on the other 2 days!).

Net income including both wages & child maintance: £3400
Outgoings breakdown:
Mortgage - £1,150
House Insurance - £20
Bike loan - £156
Internet - £39
TV Licence - £13
Bike insurance - £158
Energy (electric & gas) - £95
Water - £40
Mobile phones - £80
Food Shop - £350
Childcare - £1500
Fuel - £200
Total £3714

I suppose there are these free childcare places? But I can’t seem to find anywhere around me that offers these? And we will have 1.5 years till that starts when 2nd baby is born anyway. Not sure where we are meant to find this extra £314 from and we were hoping to be getting married in a few years but that can’t happen if we haven’t even any spare money for clothes etc let alone savings!

I've not read the whole thread but have you checked whether you'll be eligible for the childcare element of tax credits. I note you said you were not eligible for tax credits but there are a couple of different types.

Your local authority should be able to provide a list of all childcare providers who offer the funded hours.

I know, the costs of childcare suck !

To answer the question in the title, people don't choose to have 2 dc when they have a big mortgage and unaffordable luxuries like the motorbike + its insurance.

As you are caught / stuck in that situation now though, the things you need to look at are what options do you have to either cut expenses or improve income - or both.

Phones are an obvious one. We pay £9.50 and £7.50 for each of our phones..... that one small change would give you £63 pm more in your bank. Potentially you could cut back on your supermarket spend, although (not sure how old your older dc is so, 1 or) 2 lots of nappies every month do cost, so there's probably not much of a saving to be made there long term. So it looks like your options are possibly talking to your mortgage company about restructuring payments so you perhaps pay interest only for 2 years or so ?

(Just noticed you haven't listed Council Tax ??)

Or, looking at increasing income..... letting out a room Mon - Fri (although not sure how appealing that would be for any prospective lodgers with a baby and a little one in the house)..... or one of you doing an evening's bar work each week on top of your other jobs ? (knackering I know, when you've little ones, but it's what we did - well, 3 evenings a week usually - needs must when you need to pay the bills.

The EEE funding kicks in for all dc, the term after they turn 3. It is 15 hours and all Nurseries don't have to offer it, but the overwhelming majority of Nurseries do - or at least offer some places. Some do particular patterns / time slots though.... you have to ask individually how each Nursery sets it out, as they all need to recoup their costs too. That is separate from the 30 hours free childcare funding, which again, is age related, and hours you work related, not earnings related.
Go to (or phone) some Nurseries and ask how they do it.

Get a SIM only phone deal. Can your partner get to work any other was apart from the impractical and expensive motorbike? Bus? Train? Car?
Utilities seem high too, shop around. We pay £70 in a 4 bed detached with someone home all day.

We have already asked them to give up a day of their work to look after our DS

Wow.

I cannot believe people are telling you to give up work as the higher earner with a career Your DH has 0 qualifications and a shift job, if he wants to keep his bike he either takes on additional evening and weekend shifts or better still swops some of his existing daytime shifts for evenings/weekends/nights and reduces childcare costs.
I am also a bit that you’ve asked your parents to each give up 20% of their income to do your childcare!!

Hang on, your parents earn LESS than you and you've asked them to give up 20% of their income to cut YOUR costs?

Wow!

What is your age gap OP? Because so far you haven't said how long you'll have two in childcare?

As others have said, the changes are obvious - your DH works a part time, evening job and the bike goes. Not an easy conversation but there is no question that that would be the advice if you were the lower earner.

You should qualify for tax free childcare. Apply now and you'll start saving 20% off your bill a month!

We have nearly a four year age gap to afford it. DD2 is 8 weeks and DD1 will be 4 next week. Means that I’m on mat leave, and will be when DD1 starts school (for those silly half days!) then back to work in the new year so will be one lot of eye watering Nursery fees plus after school/holiday club for DD1. If we’d have had them closer together I probably would have had to stop working because it just wouldn’t have been worth it.

I would also advise one of you going part time... probs your DH. Organise shifts round each other so you do not have to pay for child care.
My DP is only on 30 grand and I dont work and yet we manage 2 children okay. We arent living a life of luxury by any means but we do fine. Our rent is 700 and we do run a car.
It because we dont pay any childcare fees because I dont work. I was the lower earner so I stopped working. Hopefully will be able to go back to it after both children are in school.
You might really have to look at one of you working part time in order to not pay childcare. It wont be forever. It is doable.

Oldest got a sibling discount from the nursery when both were there together (18 months!) and was also eligible for free funding hours.

I know lots of couples that do shift work and this enables there to be no childcare costs but both parents still in work.

Maybe I could look into an extra job working from home, not sure what though!

Why do you feel that you need to take the solution upon yourself? I don't understand - you already earn more, contributing more to the household. Work out what the bike costs to buy and run, and your other half finds the money for it, or it goes. It's his toy, it doesn't benefit the household and it's asking a lot for you to subsidise it when other things are being cut back.

How old is your older DC OP and how old will he be when new baby arrives? Are you planning on taking some maternity leave and if so, how much? If you took him out of childminder while you're on ML how old would he be when you go back to work after your ML?

Some of the solutions on this thread are, as ever, really rather drastic and don't take into account how hard it can be to change jobs or how expensive to move house, etc. I'd look to make several small changes, if I was you. Your salaries, for most parts of the country, aren't bad at all and as this is a temporary blip in your lifestyle I would look to find temporary fixes for the issues you're facing, rather than big, radical ones that might damage your earning power for the future.

We have two children which is just about affordable on a higher salary with me as a SAHP more or less. We live north and commute to London so housing is much more affordable but even then not massively so. I would have to say that the greatest cost with regards to having a second child (apart from school fees which I assume don't apply to you) was housing. Its quite difficult having small children in a small house. Obviously we've made do as vest we can but if you don't spend money on a bigger house you end up spending money taking them out all the time. But we've barely spent any extra on toys or clothes because the youngest has everything after the eldest. We also get a lot of help from family. We barely buy toys anymore because they give us some many gifts. Likewise with clothing we have only paid for about half of the stuff, the other half comes as gifts from various family members.

I’m not sure why you’re looking at you changing jobs or dropping hours when he’s the one earning less. Surely him dropping back a bit is most sensible. Also, I assume you’ll be splitting mat leave between you to allow you to be back to top earnings whilst not needing to pay childcare?

Is there a chance you could BF this time? Feeding choice absolutely up to you but it would save you a bit of money.

Def you can reduce the phone costs.

Don’t forget, it doesn’t work out at 30 free hours if you work all year and use a childcare provider all year as the free hours only cover 38wks of the year ( term time) and only 6hours a day. So nurseries will pro rata meaning if you use a provider all year and need 8-10 hours a day it works out as not much off your monthly bill at all.

We are affording it by

Having no childcare costs (me SAHM)
Living in a cheap part of the country (mortgage £350pm on fairly large 3 bed house)

You asked your family to look after your child even though you earn more than them? Are you living in cloud cuckoo land?

We are in the SE, 3 bed house under an hour from London, our mortgage is considerably less though.
We have 4 yr age gaps between all 3 of our children which helped a lot.
Our monthly income is roughly 3K.
Mortgage is £340, insurance £30, virgin tv and internet £90.
DH cycles to work and I walk everywhere which also helps, phones are £35 together, £10 top up for eldest child pm, food cost is higher (500-600) pm but importantly we have no super bike costs.

I've toyed with getting a PT job but would really only make sense to get an evening one for now since the youngest is 2yrs old.

I think your DH should get an evening job and sell the bike, he could retrain when they get to nursery age and then get a better paid job so you can both pay half of wrap around care at school age.
It doesn't make financial sense for you to give up your job since you are the highest earner unless you want to.

The bike needs to go. You cannot afford both DPs vanity bike and DP staying in a low paid job that incurs childcare costs. Quite possibly you can't afford either.

Don't you quit work or reduce your hours. That would be stupid. You're the higher earner and you're the one with the career. Protect your earning potential.

How old is your child and when are you due? What maternity and paternity leave packages do your employers offer? You may do better splitting the leave. You also need to fully investigate now the free 15 and 30 hour options for when your eldest is 3. It may be too late for you to get them as soon as you're eligible, but put your name down anyway.

Obviously also do the little things that add up like getting much cheaper contracts or PAYG offers once your phones have finished. £40 each a month is fucking ludicrous. Our phones are about £27 a month between us. That's a third of what you're paying. I know it's not a massive amount but better in your pocket.

Your DH needs to check at work to see if he can get extra shifts to cover the shortfall, or he has to become a SAHD. You could ditch the bike and insurance then too potentially.

We found our second child cheaper than our first as we didn't have to buy anything new.

You need to look carefully at outgoings, looks like you could easily save money by making a few changes.

Well, we got thrown two babies at once - so yeah, I have no idea how we manage! I can’t work, nursery would more than eat my wage. I work a very flexible job very very part time and that’s it. Maybe when they are 3 and get funded nursery time I can work more then. Til then we are on a very tight budget but we have no one to help out with the kids so can’t go anywhere anyway 😂

Sounds like you need to go back full time and your dh work around your hours and provides childcare. Then you can get rid of the bike and insurance.

You shouldn't expect your parents to lose money to subsidise your income.

We had 2 close together, my work has been erratic to fit round childcare. The good news is school happens one after another so the pain is short term. Then you could go back to part time afterwards. Or carry on full time for longer while your dh gets a qualification.

Quite a few friends have had a spouse qualifying for something while they have young children. It's not ideal but not forever and will set you up better for the future.

You'll sort it, you just need to plan carefully and accept that life will be trickier for a few years.

Congratulation btw

OP just answering your question - I realise it won't actually help you but you seem bewildered as to how others can afford it. Our income is lower than yours.

We live in a 4 bed detached house but saved up for years before we got married - our mortgage is now £490 a month.

We left a big gap between the children to make it all more manageable.

Our mobile phones and internet cost a total of £30 a month.

We don't take out loans, we save for stuff that we need, so no interest.

We walk/cycle as much as possible so only pay around £50 a month in fuel.

I am a bit of a control freak and plan everything obsessively in advance and ensure that we save a good bit of every month for emergencies. It is about living within your means really. You can do this, it will just take a lot of thought and a lot of work and potentially a change for one of you in work. I have worked PT since I had children.

Childcare is the killer. We have three on a similar income but only DH works as we home ed.

We live in a cheaper area on the South Coast and mortgage is £650 p/m.