to think it's bonkers but also not to turn down this pay rise

[fortunatefamiliar]

Name changed as I will likely get flamed.

DH and I have a very good household income, I am not denying that. DH is in a sector which pays well and thankfully has not seen a covid-related downturn. (I'm public sector but in a good job).

He was due a payrise in April but they deferred them due to covid, very understandable. As it happens their sector has been largely unhit and so payrises are now being discussed. DH has been offered a very large payrise as during COVID he did a really big piece of work which has saved the company hundreds of thousands over the next few years (company has a multimillion pound turn over) - he came up with the idea, in his own time did a demo to show it could work and then supported his team to get it up and running. He definitely deserves the payrise.

BUT

if he takes it it, it means we will no longer be eligible for DSs 30 free hours and DD won't get hers next year when she becomes eligible. After tax, the payrise will not cover the nursery expenses of the 2 children and we will therefore be worse off.

This seems like absolute madness! But it will cost us around £30k in 3 years, and the payrise will be just shy of that over than time period (after tax).

I've suggested to DH that he counter offers for a LOWER rise, which will put him just below the threshold for the free hours. This is still a good rise.

The alternative is to ask for a rise that will cover the loss of the 30 free hours, but this is quite a bit more, taking in to consideration tax.

It seems like a totally bonkers situation to be in (5 years ago we were scraping money together to pay the bills!) but can anyone else an issue with rejecting a payrise?

The OP, and many higher income families, are paying those immense childcare costs in order to work, not go off on a jolly. This is a women’s rights issue in that the cost of childcare has a significant impact on the ability of women to keep working, and all that goes along with that. Read the relationships board on here for a flavour of how many women suffer due to lack of financial independence, having given up work after having children because ‘it wasn’t worth it for them to keep working’.

OP I was in your situation last year and I gave significant donations to charity to stay within the 100k. The loss of the extra 15 hrs + 60% effective tax rate + tax free childcare tax rebate of 4K meant I wouldn’t take anything home for the first 16k or so. This year I’m well over and I actually get to keep something from the extra I’m earning. I was tempted to ask for part-time to stay under the 100k since I hardly benefit by working that extra day and paying childcare for it, but I took the long view and I’m glad I did now. No one I know at my company works part-time and I think it’s one of the ways women fall behind and do a disservice to their careers. The old earn 4 days income, work 5 (effectively) and get paid a bonus for 3.

"And yes, I am not saying we are hard up. We aren't. I'm saying it's bonkers to be worse off after a payrise.

There should be a sliding scale, where you are only ever the same off, or better and never worse off, otherwise it creates issues like these.

And I think it's wrong that 2 people can earn 99k (£198k total) and still get funded child care but if one person earns 101k and the other 1k (£102k total) and they wouldn't. It's genuinely bonkers!"
^these

Congratulations! I'm glad to see there are some good employers out there rewarding hard work. Your posts make perfect sense and don't seem boastful etc. I think the flaming you've got from some posters is unjustified.
Our mediocre nursery charged just shy of £100 per day which is the norm round here. There was a year where 2 DC would be in nursery before any free hours kicked in - it made it too much of a financial loss to work full time that year, but by some accounts on here, if I had have worked full time, I should have been rolling in it! I was lucky enough to work for myself so could retain some flexibility and not be out of the market too long. Hope you can make this pay rise work out for you.

@CloudsCoveredTheSky but she said she was a public sector worker and he’s only just been offered an amount over the threshold. She really isn’t showing off, stop being a arse.

How often does his company do pay rises? If it’s a yearly thing you’re going to hit the threshold sooner or later anyway so sure it’s better to get over the hill iyswim?

@Loveinatimeofcovid You can be a public sector worker and earn loads. YOU stop being an arse and ignoring the millions of people with ACTUAL bog standard jobs who struggle to keep the lights on. I find it hard to cry much about someone worrying about money when they earn 10 times what most do.

A bit of humility wouldn't go amiss.

@CloudsCoveredTheSky are you living in the 90s? The public sector pays half of what it should for the type of work being done these days. They’re hardly loaded. They’re definitely not earning tens times as much as anyone else.

‘I've paid in far, far more tax than I have taken out.’

So your family all have private healthcare, your children will go to private school, you don’t use roads, parks, libraries, and will never use emergency services?

[quote Loveinatimeofcovid]@CloudsCoveredTheSky are you living in the 90s? The public sector pays half of what it should for the type of work being done these days. They’re hardly loaded. They’re definitely not earning tens times as much as anyone else.[/quote]
The public sector pay wise (NHS) isn’t poorly paid compared to a lot of other companies. I agree with the other poster that you can earn quite a good wage depending on your role.

Lots of people face this issue with the costs of childcare but in OPs case she’s not exactly struggling.

OP, there’s some good advice on here.

Please ignore the silly sensitive posters
who don’t understand how to simply press ‘back space’ on a thread that makes them jealous, sad or upset. They want to make the space something it’s not. Mumsnet is for everyone and all problems, whether about benefits or ski-gear.

Squeezed middle is widely thought to be 60-100k gross household income

Squeezed middle ? That's ridiculous at that high income.

@betteliefsen

Squeezed middle is widely thought to be 60-100k gross household income

Squeezed middle ? That's ridiculous at that high income.

60k household income is two adults both on an average wage, hardly a high income.

Squeezed middle ? That's ridiculous at that high income.

Without childcare costs such a salary is certainly enough to live fairly happily on. It’s only 30k each at the lower end of the scale. You do realize that full time work on a 30 k salary does not even cover childcare for two children?

This is exactly why the government helps. I know plenty of families with a joint income of 100k who have had to wait until the free hours kick in to afford a second baby.

On benefits threads we are always told that the cost of living and rents are so high. Well mortgages are high too and childcare is astronomical. It really doesn’t have to be a race to the bottom.

Just put extra into the pension for three years to stay below the threshold. I can sympathise, I had a similar situation.

I think you need to reframe your thinking.

I agree. Ludicrous to say you're not wealthy. You are wealthy and you're trying to find ways to save £30k which is way way more than many people live on per year

Give your head a wobble and grow up

You really don’t get much left after those big expenses. After nursery fees drop off they’ll be laughing but it doesn’t mean they don’t need help in the meantime.
I am not so sure tbh. I also expected a massive drop and to run off into the sunset laughing, but for me before and after scholl + holiday care still adds to a painful amount. Childminders are £8 / hour around here for wraparound, if you need 1 hour before school and 3 hours after school for 2 kids, that's £64 / day. Holiday club £250 / week for 9 weeks (assuming annual leave for the rest). Not even to mention that if you want the children to attend any extra activities, it has to be a nanny who can take them.
It is cheaper than the full time nursery, of course, but still easily "a second mortgage".

And I think it's wrong that 2 people can earn 99k (£198k total) and still get funded child care but if one person earns 101k and the other 1k (£102k total) and they wouldn't. It's genuinely bonkers!"

No it's not. You are making assumptions about the government's motives for funding and giving tax breaks on childcare. The current policy encourages a pattern of both parents working and contribute to GDP. It also (deliberately or not, I'm not sure) applies pressure on the higher earner to reduce their hours (and hopefully do some childcare!) or to pay more into their pension if they are at the boundaries where they lose benefits (so 50K and 100K). To tax a couple as one entity applies pressure on the lower earner to give up work because a much higher salary is needed to feel the benefits of both parents working. That would be a backward step forwomen, trapping even more of them in a financially dependent situation.

What would be the difference between you and a benefit scrounger?

The difference would be that the OP’s household actually funds its own benefits through the tax system.

Plenty of people on here eager to bash anyone who does better than them.

I can also guarantee that most of the people moaning about her immorality would be doing the same in her position or at least checking the financial position carefully. It’s why the advice is out there to use pensionAs it’s clearly not a rare question or concern . She acknowledged she was in a fortunate position.

Wow! No advice sorry but 14k a year for nursery? It's been a long time since my DS was at nursery but that's a fortune. My DS, now 16, went to play group in the morning when he was 3, which was a fiver a day, then into the school nursery which was free (Scotland must be differential those years ago).
14k! I'm totally taken aback and clearly it up with the price of these things nowadays, Is it the queen who is the nursery teacher?

My local nursery charges £91 a day, I use a childminder who is £65 a day. That's pretty normal for London.

Holy moly, our nursery is £57 a day and CM about £35 a day. I thought that was a lot!!

Fair amount of envy in this thread.

Of course it's not unreasonable to not want to be materially WORSE off from receiving a pay rise.

Some people, honestly.

It is cheaper than the full time nursery, of course, but still easily "a second mortgage".

When you put it like that, yes. I can ashamedly put myself in the category of people who clearly didn’t think through the long term implications of having children! That’s depressing!

and I pay my childminder 52 wks off the yr with a 50% discount for 4 wks holiday. If she does any wrap around care it's £10 an hour.

I can ashamedly put myself in the category of people who clearly didn’t think through the long term implications of having children!
Me too. I come from a country and have been living before in countries where childcare is not necessarily free but heavily subsidised by the state for everyone. I started researching nursery costs in London when already ~7 months pregnant with my first, and, to be honest, I thought they were joking when quoting numbers like £1800/month to me. I am still puzzled as to why childcare subsidies taper off so abruptly for higher earning women, to the point where it simply does not make financial sense to work even on a very good salary - but the state WOULD like female doctors, engineers and lawyers to return to work, wouldn't they?

And OP I would defo suggest that your OH asks his company about shares which he can cash out in a few years. This is what my OH does, you don’t have to declare them until cashed out, then pay tax on them the month you cash them out.