To be frustrated that I’m worse off work working more?

[Financialfrustration]

Name changed.

My husband and I both work. I’m part time just now, but plan to go back to full time by gradually increasing hours.

Currently we are managing without paying for childcare because I have holidays to use which I accrued while on maternity leave, plus using family. These holidays will run out soon, so we are going to pay for nursery.

If I remain 3 days we are entitled to £95 universal credit and £50 Scottish Child Payment per week, which leaves us of a balance of 79p per week which we have to pay towards childcare for the three days we require it.

If I go to 4 days per week, we are entitled to £64 universal credit and £50 Scottish child payment, leaving us £77 to pay for childcare for the 4 days we require it.

Working 3 days per week I take home £338 per week, working 4 days I take home £466. That’s £108 of a difference.

In other words, if I work an extra day per week, by the time I pay £77 towards childcare, I am only £31 better off. Off that £31 I also need to sort after school care for my eldest, and get everyone to school/nursery/work on time by public transport (possibly taxi as it’s going to be impossible to do with the drop off times otherwise, and my partner is already at work by the time we leave)

I find it absolutely crazy that working more actually doesn’t pay, even for someone who has a “well paid” job.

Are you not eligible for the tax free childcare? That knocks 20% off nursery fees here. And comes to much more than wed have been eligible for in UC so is better for us as a family.

Yes that’s what I’m saying. I earn significantly more than him. In the past I’ve always worked full time and him part time for this reason. We had saved for me to go temporarily part time for two years, which we would have been able to do had the cost of living not increased, so we went though money a lot faster than anticipated, and our car unexpectedly died so we had to buy a new (to us) car with some of the savings and take on a car payment again.
Im not saying we are in a “bad” financial position because we are more fortunate than most and I can obviously go full time, but it’s frustrating to know how little I’m working for - especially since I work around 10h/day.

Well, there are differing schools of thought on whether it's easier or harder for those on the lowest incomes if benefits are restricted only to them. It's opinion territory rather than fact.

But I agree about the need to provide solid financial incentives if we want people to work. Unfortunately, we have a bollocks of a system. The fact that childcare and housing costs are now so expensive that there's a small but growing group of higher rate taxpayers who are also entitled to UC pretty much says it all.

I’ll need to look into it, thanks!

Is it through your employer?

If I go full-time and we have to pay for full-time childcare, I might fall into this category. Which is absolutely mental.

No it’s a standalone account offered by the government. We use it on both ds1 after school care and ds2 nursery fees- at full rates we would pay £40 and £250 a week, with the account we pay £32 and £200 a week. Our joint income is under £60k so we rely on this hugely.

www.gov.uk/get-tax-free-childcare

Tax free childcare is available through a government scheme, just Google tax free childcare.

What years/ subjects do you teach? Tutoring can earn £35/hour and can be flexible

I read this article about it, summing up the situation.

www.resolutionfoundation.org/publications/inconsistent-incentives/

It's always been theoretically possible but it didn't occur to me that it was actually happening.

There is no way I could do night shift, on the days that my partner works he is gone for 12 hours and we have a baby, I do need to sleep. I could do this during the school holidays but not when school is in session. It will also impact on the UC element so even if we earn an extra £100, we will then get less UC and lose the Scottish Child Payment element too. That’s what I find most frustrating.

But yea, £31 for a 10 hour shift is … not great.

I do the odd bit tutoring. Demand for tutoring has dried up with the cost of living crisis.

Me! Me! Me! The difference is that tax payers money is paying less to look after YOUR children and can instead be used to fund education, the NHS, social care etc. I would sat that from a societal point of view, it's a pretty good outcome.

It's a crappy situation when it doesn't pay to work. I understand your situation. I myself can only work part time due to health and so partner works full time. Another poster mentioning in work poverty - certainly feels that way to us also Lots of people have disagreed and will do but if I were you, I would stick with the 3 days until baby was older or you are in a position to go full time.

You do realise that I’m also a taxpayer, and if they made working more pay more, I would potentially be a higher rate taxpayer? You do realise that I’ve worked full-time for 10 years so far and I’m talking about working part-time for a period of two years before going back up to work full-time as a higher rate taxpayer, where I’ll remain for another 35 years? Yeah? You do realise the UC I claim goes directly back into education as it only covers my child’s nursery fees?
You do also realise that allowing people a little more money to spend on disposable things boosts the economy for everyone?

There is tax relief on childcare costs. It's called Tax Free Childcare but it's limited to £2k a year.

Childcare vouchers aren't available any more

It sounds like your husband needs to get a different job that allows him to be around for either drop offs or pick ups thereby allowing you to go back to work full time

If the situation were reversed and your husband were the higher earner and you had a part time job, do you really think you would still be rushing around getting the kids to school before work without the family car, working part time and stopping your pension payments?

You would be trying like so many women to find a job that fits better around school hours.

Instead you are the higher earner who is taking the hit to both your pension and your career prospects, doing the majority of the childcare and doing without the family car even though there are three of you to get somewhere instead of 1

It frustrates me no end that there isn't more help for working parents. It baffles my brain why we pay for some under twos to go to nursery when parents don't work.....i get the funded hours at 3 to give children who wouldn't be able to attend some opportunity to be in that environment ect ect but why then lower it to 2 for some....

My partner did offer to move jobs, but his job is pretty well paid due to the fact it is unsociable hours, so he would need to work longer hours in a job with better hours to make the same money. It was me who encouraged him to stay where he is; yes it’s shit on the days he works but he is off a lot, and he does pretty much everything else at home.

This issue wouldn’t exist if I went full time, as my earnings would be more. It’s never been an issue in the past, and the plan was always that I worked part time until we decided to try for baby 2; then the plan was that I’d take a year off then go back full time, but once he was born I decided I wanted a shot at being part time too. He went full-time on a trial basis and it was far harder on me, so we decided it wasn’t worth it. Plus his health condition could flare up at any point, although right now it’s not an issue.

The car thing isn’t of his doing - I don’t drive. If I did, I’d have the car, no doubt about it. He’s totally supportive of me driving and taking the car; but I’m scared to drive. He also told me not to stop paying my pension - my pension pot is considerably larger than his because he was a SAHD for years when dd was small, so I do feel it’s fair. His pension payments are far smaller than mine.

My career prospects aren’t really impacted either - I’m already at the top of where I want to be, I don’t want to take on a senior role because it would take me away from actually teaching, which is what I enjoy. He had a good job in the past and gave it up to allow me to keep working.

It might not help, but I've never found entitledto very accurate.. could you get CAB or someone similar to check for you?

You sound like you have the same combination of jobs as me and my DH.

Flexible childcare is out there. We only pay for a few days of childcare a month on the days that DH is working. It was hard to find this but it exists.

If your DH works in health, he could consider looking into options with more predictable shift patterns (111 maybe?) which still give payments for antisocial hours.

He could also take you to work on his days off or you could take the car which would cut down on public transport a fair bit.

Although to be honest, I do find it baffling when people only do these calculations when their child has been born. The childcare situation has been like this for years

OP if you're financially struggling you may have to go back full time. You may want to do part time but realistically not many can afford for both to be part time and sounds as if your DH is already part time and you don't want him to be full time. I don't think the benefits system should be there for people who choose to work part time.

No state help with the UK's vast childcare costs for part timers is a great way to incentivise lower earners in couples to stop working altogether.

Nursery years are crap from a financial perspective. I worked 3 days a week and I earned -£200 a month for that privilege until my eldest started getting free hours (only 15 hours a week at that point. We hit our savings every month to allow me to work part time (and also give the children the social and educational benefits of nursery).

Falling out of the work place entirely would have been so much worse in terms of career progression though. Now a decade or so on and life is a lot easier and the kids don’t seem damaged by it either.

However I’ve always thought the big issue with childcare is the massive hit in a condensed period. Any government that allowed you to pay costs back over 18 years (even with a bit of interest) rather than in this early years would get my vote*

*unless they were Tory. Although it would at least make me grudgingly give them a thumbs up.