How do people afford kids?

[crumbsnamechange]

I feel like I'm missing a massive trick here!

DP and I earn around £72k jointly (I earn the bulk of that at £48k, but have ~£250 per month student loans, and high pension payments, and pay slightly more of the cut of the rent than him). DP is expecting to earn a higher salary in about 18 months' time, but it's not guaranteed, and it's uncertain how much higher.

If I went on maternity leave say within the next year, that would leave us with a severe shortfall as DP's salary alone plus maternity pay wouldn't sustain us (we live near London so our current joint income only just covers huge rent and current outgoings with a bit of savings).

How do people manage it? I've been reading on other forums about how you just make do, you sacrifice your lifestyle and don't go out as much etc. so more money for rent and baby, rely on relatives etc. so not paying huge nursery fees all the time etc. It just seems so hard, a huge stress, and unsustainable. And that's before I even consider the effect a baby would have on my career. Would it be foolish to consider a baby now since I don't even know how we would afford it?

Your rent cost is more than three quarters of my monthly income. My mortgage is £300pm. There's your answer!

I was fortunate that I didn't need to pay childcare for my Dd but I know its where the majority of peoples money goes. I think if I was to have another I would take out a loan over 10 years and basically spread out the cost of early childhood like you would when you but a car, sofa or other expensive purchase. 10 years to keep the repayments low and then use that for additional expenses and childcare, once the DC were at school and I was back at work I'd over pay it.

In all honesty most people I know who have been relatively comfortable bought before they had children. We did that but also saved so we had a cushion. Nursery fees are probably a bigger cost to find that mat leave because it is for such a long time especially if more than one child. I found it easier to economise on mat leave when I was at home than I did while juggling work and a baby.

Our joint income very similar to yours. We funded mat leave using all our savings (over £20k) and with childcare costs we now live hand to mouth.
It’s not forever but it’s very hard!

@crumbsnamechange

Thanks for all your replies, I really appreciate it. Very interesting to hear about all the ways it can be done.

However...it sounds like for it to work, it would likely mean either saving like mad starting ASAP (I'm mid-thirties now so aware of time) or giving up our lovely 2-bed rented place here very close to London and moving somewhere cheaper (we went for a 2-bed as we both currently WFH). The rent is £1600 a month (that's more than DP's current take-home salary) - when I compare that to my mum's £300 mortgage up North for the same size house I try and justify it thinking we're in such a fun area and close to all our friends, hobbies etc...

We aren't in a position to buy, but on the plus side we have no debt (except student loans for both of us) either. Apparently my work offers 6 weeks of full pay, then a staggered amount downwards after that.

We were in a fun area with friends and hobbies too but after my mat leave I found it irrelevant where we lived tbh as being a parent meant no more hobby time/meals with friends etc so we saved a fortune!

You shared parental leave and the lower earner takes a large proportion of the leave

We earn a joint income of 54k. Equally split at 27k each.

2 kids, ft nursery fees, wrap around for the big one as we have a 4.5 Yr gap.

Its tight atm but fine, still have the odd weekend away. But yes, our mortgage is 900 a month in the NE.

Your income is about 10% more than ours but your rent is nearly double.

I disagree with the people saying 'you' ll manage'. Not necessarily - there's no way we could take a 10% income rise and 50% rent rise and manage, none at all 🤷🏻‍♀️

@sqirrelfriends lol I meant a week! I blame the heavily pregnant swollen fingers.

@crumbsnamechange you can start saving for maternity leave now and when you are pregnant. Also CM are cheaper than nurseries but also harder to come by in London. You might have to move somewhere cheaper but also depends on commute etc.
We both have a career, I went pt for a couple of years and the ft again. Financially it was tough but now we have less stress, I could stay in my career. Of course then you have to juggle other stuff like babysitting, after school clubs etc. It never stops even when you can afford help 😅🤣

8Sceptre86

OK that makes more sense. £3.5 per day per person. Much more normal.

How do you think people on benefits cope? Low paid jobs? You just do.

I only had 6 months ML first time as that's all we could afford for me to take. 9 months second time. A lot of people seem to think they are entitled to at least a year these days, whether they can afford it or not.

We saved what we could, were sensible and found that some outgoings automatically reduced anyway (my commute to work which was 20 miles each way, etc).

We didn't live in London though and our mortgage was a fraction of what you are paying so I guess I'd suggest moving somewhere cheaper if you want to start a family.

Most of my friends moved to London after uni but one by one they all moved away when they wanted to either buy a house and/or start a family as it just wasn't doable.

Combined salary of 115k currently, going up to 130k when I start my new job after mat leave.

I saved a ton for my mat leave - helped that we were in lockdown during my pregnancy so no commuting costs, couldn’t go out etc but have also hardly spent anything while being off. I worked out the shortfall across the year (although returning early at 10 months due to new job) and saved to “top up” my mat leave to my monthly salary.

A couple of years before we wanted to have kids, I started lining things up so I had a decent enough job that importantly has a good maternity pay package. I get 13 weeks full, 26 weeks half and 3 weeks stat. That’s played a big part in affording my leave.

We also live a pretty frugal lifestyle - I walk pretty much everywhere and we just run one car, old mobiles etc and swap our bills. Nights out are now drinks in the garden with friends instead.

I’ve managed to save again while being on leave so my maternity leave fund is now the nursery fund and can probably pay for a year of fees. We have no family close by so can’t reduce this amount, although I will be working four days.

I’m getting a 20k pay rise with my new job - literally just from asking & holding out for a higher salary so that will help us save further for future children and maybe even allow DH to reduce to four days pw too. He’s going to be earning about 10k more than me (FTE) so means that there’s less pressure on him to be the full breadwinner.

[quote Sceptre86]@sqirrelfriends lol I meant a week! I blame the heavily pregnant swollen fingers.[/quote]
That makes so much more sense! I thought maybe you'd found the holy grail of mumsnet chickens

Here are my suggestions based on my own personal experience. You may not like them, and they may not work for you and your lifestyle, but there are here none the less.

• Work out which of you had the higher earnings potential VS who wishes to stay at home with a child. Childcare is so expensive that it may actually cost more to send them in, vs not working at all.

Working evenings and weekends, as well as freelance to keep your skills up can help. It depends on your career. This is a discussion you need to have with your partner as you may have to sacrifice if you cannot afford childcare for the first 3 years.

• Find a way to lower your accommodation costs. Cheaper area and commuting/WFH, purchasing a home VS renting definitely makes a difference. We wouldnt have been able to have a child while renting.

• Basics such as prams/cots/clothes are available inexpensively, that's a red herring if you can lower the cost your living costs.

Two children is not much more expensive than one when they are little (and so on) but changing you life and living costs to accommodate one is very difficult.

You need to start getting in the habit of saving. Monitoring your spending and finding where you can shave off expenses.

@crumbsnamechange

Thanks for all your replies, I really appreciate it. Very interesting to hear about all the ways it can be done.

However...it sounds like for it to work, it would likely mean either saving like mad starting ASAP (I'm mid-thirties now so aware of time) or giving up our lovely 2-bed rented place here very close to London and moving somewhere cheaper (we went for a 2-bed as we both currently WFH). The rent is £1600 a month (that's more than DP's current take-home salary) - when I compare that to my mum's £300 mortgage up North for the same size house I try and justify it thinking we're in such a fun area and close to all our friends, hobbies etc...

We aren't in a position to buy, but on the plus side we have no debt (except student loans for both of us) either. Apparently my work offers 6 weeks of full pay, then a staggered amount downwards after that.

If you are working from home can’t you move out of London?

I found all the 'you'll manage, just get on with it' comments annoying too. We were in a similar situation, living on the outskirts of London and earning half of the household income each, though our joint income was about 50k. Statutory maternity pay is low, and you can't just lose a big chunk of your household income and assume you'll be OK. We saved for a few years to save the shortfall in may income, topping up the statutory maternity pay to what my previous salary had been. Since my maternity leave ended I've worked part-time time, and my husband's gone for promotions so he's been paid more. It's not ideal as I'd prefer us to earn equally, but it's just for a few years until I can work full-time again.

This is an interesting thread, thanks for posting OP.

I've had the same discussion and my partner and I both earn £44K, we rent in London, can't afford to buy here but are sacrificing London and moving to Manchester to buy a house approx £250K (approx £1,100 payments a month between us). Salaries will value at approx £35k for both of us up there, we have both agreed to work 4 day weeks if we have a children and 3 day nursery (again cheaper in Manchester than London). Well that's the ideal scenario!

I think our generation will have to make sacrifices for parenthood unless nearby grandparents can help with childcare, otherwise money will always been an issue. It's really about what's important to you both first.

A few things:

Where we lived as a young couple was NOT where we wanted to end up as parents. We lived in a much more "fun" part of London. This was even fine when we had babies who weren't in need of child care. It was not feasible later -- the child care options, and even the activities, were too expensive. And the school options started to factor in heavily, even though at the time we were sending them to an independent.

Once DC arrive, you really DO just get on with it. The "stuff" is the easy part, and young children don't really add that much more to the expenses in themselves. The childcare is the big expense , and unless you're going fee-paying, it reduces once they're in school. So it might be a squeeze, but not forever.

We earn the same (plus both paying student loans), we have three children in the home full-time, plus one maintenance is paid for. I'm not sure why you'd think it isn't enough? We're in a pricier part of the Midlands.

For maternity leave, we saved prior to, so we'd have a baseline amount to live off (with plenty extra) for the whole 12 months I was off. We never had a "drop" in income. Is that an option?

We're not well off but we're comfortable, there's never a worry about any bills being paid, we can deal with an unexpected expense, can fund home improvements, enjoy nice days out and clothes as and when needed, pay for clubs etc.

We'd have to save for a holiday abroad for a year or two though but there are 6 of us! I suppose it just depends on what you think you need leftover after your bills are paid.

@crumbsnamechange

Thanks for all your replies, I really appreciate it. Very interesting to hear about all the ways it can be done.

However...it sounds like for it to work, it would likely mean either saving like mad starting ASAP (I'm mid-thirties now so aware of time) or giving up our lovely 2-bed rented place here very close to London and moving somewhere cheaper (we went for a 2-bed as we both currently WFH). The rent is £1600 a month (that's more than DP's current take-home salary) - when I compare that to my mum's £300 mortgage up North for the same size house I try and justify it thinking we're in such a fun area and close to all our friends, hobbies etc...

We aren't in a position to buy, but on the plus side we have no debt (except student loans for both of us) either. Apparently my work offers 6 weeks of full pay, then a staggered amount downwards after that.

It's the location. I know very few people who have stayed in London (or nearby) after having their kids. It is very expensive and coupled with childcare fees it is just not possible for many.

You mention your mum, are you close? Because if so, chances are you will feel a very strong pull towards wanting to move closer. If you did, is she in a position to help with childcare at all?

Presumably your earning potential would be less up north, but obviously that's offset by the cheaper housing costs etc.

See what you could realistically earn up north and weigh it up against rent / house purchase costs and childcare.

Maybe you could each work 4 days per week or something, meaning you would just need to sort childcare for 3.

You mention your friends in London however, unless they also have kids, you need to factor in the fact that you most likely will be seeing a lot less of them.

You end up spending a lot less than you think because once you have kids you can’t go out for dinner or drinks, or even to the cinema etc, so you save a fortune. The higher earner can’t take more than a few weeks parental leave though. Your rent is ridiculous, mine is a third of that. And the reason we live in such a cheap property is so we can afford to raise kids.

We started saving the equivalent of full time nursery costs each month for about a year before I fell pregnant. Maybe not religiously but regularly enough to build up a good savings pot to cover 1 year of mat leave. It also made us realise how tight things would be financially in our current property so we moved out of our fancy flat (not in London but another major, fairly expensive city) and bought somewhere cheaper further from the centre. So there are definitely a lot of sacrifices that have to made, but as others have said the lack of holidays and nights out comes with the territory anyway!

OP we have around the same income jointly as you, difference I guess is that DP earns more than me.
We saved ahead of TTC so that we had enough money saved so I didn't drop at all even on maternity. Although my company offer an enhanced package 6 months full pay. So I then got 3 months at half the pay and 3 months of no pay (went back at 15 months but used all my A/L I'd saved to extend.
We saved HARD but it was worth it. In the end we didn't need it all & put some towards moving.
We live in SE not far from London
I couldn't have afforded it without my company maternity package but again it's one of the reasons I joined & stayed & went back full time because they support me & my family & thst was a priority.