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!

Well, to answer the initial question, although none of it will help you, we bought our house based on just one wage. Grandparents did the childcare so all mine did in nursery was the free hours and i went first to 3 days a week and then 4 days a week. I also work term-time only.

I dont upgrade my Phone so only pay the line rental now. My phone Bill is £15 a month for my iPhone 6.

Please don't abort if you do actually want a second child at some point, who knows if you will get pregnant again and who knows when you will believe you can afford it. Our income is 27k and we get by, I became a SAHM so no childcare costs. You just make it work.

We had a good joint wage (almost £50k in Central West Scotland) at a fairly young age (both under 25) and owned a home.

DC1 I had at 17, and is now in school.
We can only afford DC2 as we have no childcare fees.

OH is off to retrain in August and money will be incredibly tight but do-able. We'll have no foreign holidays etc but we will get by.

We live in the SE, two kids, income about £30k all in.

We don't borrow money.
Im a SAHM so no childcare costs other than a couple of hours a week paid for with childcare vouchers.
Few holidays or regular luxuries other than decent food. (Not Asda, try and buy local and more ethical)
Buy and sell toys and clothes etc kids grow out of
Use cash back sites
Buy in advance in sales etc

We live very comfortably. To be honest it depends what kind of lifestyle you expect. If you don't want to compromise your lifestyle for no 2, then don't do it. We don't have 3 as we would need a bigger car and realistically the higher costs would impact too much on existing DC.

I don't have a 'career' any more. But realistically, Im going to be working for another 25 years after youngest reaches secondary school so plenty of time to do that later!

By child maintenance do you mean child benefit?

Being a sahm is not the answer! Yes childcare will cripple you for a few years but then they go to school and you’re finally earning fairly decent money again. And it all comes in so handy! The 15 free hours and then 30 does also really help.. you will need a setting that accepts them.. most nurseries do

I went back to work and dh was sahd as he earned less than me and I could work ot.

Congratulations! We afforded it because we had no housing costs and my in laws helped with child care .
Also cheap car, cheap phones, no holidays etc It all adds up .

You really need to look into tax free childcare. You can apply online and have it up and running fairly quickly. It saves you 20% off your childcare bill. Go to the gov.uk website

we have a higher income then them! Both sets of parents still have younger kids that live at home too. We have already asked them to give up a day of their work to look after our DS.

Are you serious?! How can you justify asking them to cut down their work to yourselves whilst having an overpriced luxury motorbike toy that’s eating into your budget and also an expensive phone each!

Your poor parents -I am genuinely appalled.

I had to have a bigger gap because I couldn't afford full-time childcare for two children at once. That is very expensive for most people. Presumably the £1500 is for two children. Bike loan and insurance come to £300 a month together. That is a lot of money. And mortgage is quite high for your earnings.

I suspect the phones are on contract and it's not always that easy to just change to a sim only plan straight away.

Honest answer op is that we had a 3 year 3 month age gap.

It one thing trying to scrimp together £50 anmo the but £300 odd is a bit of a stretch.

In answer to your question. We waited and had a four year gap so that we only had one big childcare bill. We also saved as much money as we could so I could have a long maternity leave for he second. We earned significantly more than your salary in the SE and it was a struggle (no family/Gp’s). I have friends who now have headed north to do what is now impossible in the SE on a similar salary to what we had a few years ago. Sacrifices have to be made. The answer for you is what will yours be/what are you willing for those to be......change location/smaller house/longer term mortgage/no holidays/no branded food products etc etc. Good luck

Like others, most of my friends seem to be waiting for the free hours to kick in before having a second. Obviously that doesn’t help you now but that is the situation for lots of people who would earn much more and it helps to explain why you might find it a challenge.

What type of mortgage are you on? Is it a fixed and if so, how long are you tied in? Like others have said hopefully once you hit 10% equity you’ll be in a better position to remortgage. Your rate isn’t outrageous but you could do better on a tracker later on. We’re paying a premium for a longfixed rate but we wanted the security of knowing the payments wouldn’t rise during childcare years. In hindsight that might have been an error given the low rates.

Are you likely to get any inflationary rises to your pay? If so that might make things a bit easier (but won’t touch the childcare). Are you paying into pensions? You could de-roll/cut down payments temporarily. That’s not ideal (and could be bad if you get death in service benefits)but might get you a bit of wiggle room.

Get on money saving expert and do a full statement of affairs. There seem to be things missing from your list like council tax, life insurance, car insurance, MOT etc, general spending on birthdays, Christmas, clothes, dentist. Forum posters there will help you so a realistic budget. You do need to know your likely costs otherwise you risk making poor financial decisions. There’s no point planning to be £300 over if realistically it’ll be £450-500. Having the numbers there in black and white might also help your other half to see that something needs to change or you will both end up in a lot of debt unfortunately. You might be able to sustain that for a while and borrowing may be your preferred option over changing jobs but it would be better to make that decision in a properly informed way.

We have a joint income of £120k and still had to wait 5 years to be able to afford it as couldn’t afford double nursery fees.

I waited until my first started school to have my second baby. We couldn't have afforded two in childcare. You will be entitled to up to 30 hours free when your first is 3 years old - most nurseries should offer this. You can also apply for the tax free childcare scheme