Cost of childcare - is it worth working for near nothing after paying for childcare?

[PJRules]

Was hearing about how 'the cost of childcare means mums are having to give up work' on the radio today.

As a headline it's shocking but I wonder how true it is.

When mine was a baby I made about £20 a day after paying childcare and commuting costs (working 3 days a week).

Is it worth working for 10 hours for £20? Not unless you're desperate for the money imo but it had other advantages:
I stayed in enployment
I progressed in my career
My pension built up
I had a job in case DH lost his
I was mentally stimulated
I got to spend time with adults

When people say they're worse off working is it genuinely true or is it that they don't see the value in going to work for the money they'd get (or they'd just rather be home with baby, no judgement here 😊)?

YABU - I would be financially worse off going to work
YANBU - I would be financially better off but might not think the advantages are worth it

Really I'm just interested to see past the headlines, maybe it really is financially negative for a lot of people to work.

I really struggle with this. I absolutely loved the time I spent with my DCs before they went to school, but that time is very short and now I feel like I should have taken the part time hours offered to keep my foot in the door. I had a promising start in a competitive career, but because I took years out, I have struggled to even find minimum wage shop jobs. Even though my husband has always seen the money he earns as ours, I love the feeling of adding money I have earned from a job into the pot but I feel very unfulfilled in a job with pretty much zero prospects with hours that change from week to week. I can't afford to retrain.

I was made redundant from my 9-5 in February. Full time nursery for both of my children (both under school age) was over 2k a month, even with 30 free hours for the eldest. More than what I earned from that job. After redundancy I did consider just staying at home until youngest got free hours at nursery, but realised I wanted to continue working but didn't want to be losing money each month. So I've now started working evenings and weekends whilst DH works during the week.

Even though my salary is less than my previous job, we are actually better off as all of my wage (and then some) isn't going on childcare. It's also handy if the kids are ill as neither of us have to take time off work to look after them as there's always one of us at home. I'm also still maintaining a career and contributing to my pension. I think one partner working evenings and weekends is a good compromise, rather than one of you not working at all.

It's currently looking like around half of people are genuinely financially worse off working, that's absolutely shambolic.

Like I said I thought there was a value to me going to work but I'm not sure I'd want to be effectively paying to do it.

It probably depends on the job and how you feel about motherhood too, I'm sure a lot of people would rather stay home with the kids and avoid work stress for the sake of £20 a day.

Actually should have listed the upsides to staying home too, things like:
More time with the kids
Less stress particularly for covering illness
Not having to deal with the ducks at work
Time to think about changing career
(Probably) a more ordered home life

I never understand why women say they are earning £20 a day instead of bringing the spouse in on it too.

It's perfectly reasonable to want adult stimulation once you're a mother. I'm pregnant and want a family but I also know I don't want having children to become my entire universe. Self care and focus isn't depressing, for many women it is both sensible and a life saver.

It is good for your long term independence as well just in case your relationship breaks down with the father

Because your individual earnings are irrelevant, what matters is household income. The household is only £20 better off per day no matter how you slice it.

Agree with you OP.

Financial vulnerability and the gender pay and savings gap sums it up for me.

In many ways it’s not irrelevant. Your spouse could die, become disabled or leave you over night and then your household income made up largely from your husband’s salary would be irrelevant and your individual earning capacity would be very important.

I agree, and that's how I always viewed it but many women think of their wage covering all of the childcare and so working for free, they aren't. The household income drops. But the benefits of keeping a hand in the working world are many.

This is a fair point, we should be careful with language. Our money was always joint and so my household was only £20 a day better off with me working.

I do know women where the kids are her responsibility and the childcare comes out of her wage and reduces her spending power whilst he keeps control of the majority of the 'family finances' 🤬

I agree with you, there are many benefits beyond the take home pay. In my sector (university) the employer pension contributions are very high so that alone would motivate me to continue working. Plus very generous mat pay if having subsequent mat leave, plus life insurance, sick pay etc. I don't think you have to spend 24/7 with your kids to be an excellent parent, and nursey has so many benefits.

And you're covering yourself if there's a relationship breakdown. I've had friends who've been SAHP then a divorce, and they've struggled to get work

I stayed in enployment
I progressed in my career
My pension built up
I had a job in case DH lost his
I was mentally stimulated
I got to spend time with adults

All of this is true for me and why I stayed at my job, putting two DC through nursery, where we made a loss most months and had to have help from my parents and PILs to meet the monthly cost.
I've been in my job for 20 years and now make twice as much as I did before DC1 was born. Sometimes you have to play the long game and hope that it pays off.

I think in most cases is depends whether you take (or even whether you have the choice to take) the long or short term view.

short term - we robbed our savings every month to allow me to work and cover childcare costs. It was soul destroying.

Long term - pension continuity, stability for the kids (ie they weren’t in and out of nursery, career progression. It was a very tough few years though. And not everyone has the ability to choose.

Your household income is one pot, your childcare goes out of that pot.

Two parent families will almost always be better off financially with 2 parents working. Maybe not for the nursery years but longer term.

IME women use it as a reason not to work, because they don’t feel comfortable saying that they want to be SAHM. Especially if they’re giving up a job which has required a lot of education//training and financial input.

Being a SAHM is a perfectly valid lifestyle choice. But most of the time the argument that the childcare would me as much/more than the mothers take home pay is a ridiculous reason.

After tax, NI and pension a minimum wage job would pay less than a full time nursery place (15000 a year at my kids standard nursery, In NW) if the other adult at home had a job that pays over the threshold for any tax credit/UC contribution to childcare. Wouldn’t be worth working. We are currently in that position but as my OH does not want to stay home we need to suck it up and pay.

For millions of people that makes no difference. If you’re in a minimum wage job you can easily go back to a minimum wage job after any length of absence. I could get a new job tomorrow after several years out of work and be on the exact same salary as before. In fact I’d be better off because minimum wage has increased.

I have always queried why childcare can’t be a loan like a student loan that is paid back over the longer term.

The main problem is that it is practically an additional mortgage to find overnight but for a relatively short period of time. If the monthly hit could be lower even if the overall costs were broadly the same it would take such a lot of pressure off.

It’s better to work for nothing for several years as you have money going into a pension, plus it won’t be hard to break back into the workforce; and several years later there should be some career progression so you are not rejoining on a lower rung and having to work your up from scratch.

I don’t even know where to start with this.

MOST parents of under fives also have a dog? Which spurious data source did this little nugget come from?

Imo it's always worth working, your reasons were the reasons I stayed working and paid childcare. Even if it's only with an eye to the future. Your dc won't be in childcare for long in the grand scheme of things, but you'll be far better off in later life without taking a career break and impacting your pension. It was better for my mh too, to continue to work

Quality of childcare was also a factor for us.

Would I have stayed in work, breaking even, to build up pension contributions if my DC was in great quality childcare and happy - yes!

But the quality of childcare available was not adequate for a child on the pathway to autism diagnosis and her mental health was suffering.

The childcare sector is in crisis at present due to wages and cost of living and the government has done nothing to address this.

Eldest is 22 years old and I've been a SAHM since she was born with 2 younger others in between.
I am also pregnant with number 4 and when this one starts school I'll be 45 and out of work for nearly 30 years.
I do wonder if I'll ever find work in the future but I couldn't afford to work, my choices will probably have consequences.

I am similar to you in that I am slightly better off each month (say £100 by putting my child into nursery).

This only works because my partner is flexible to do drop off and pick up so we can do 4pm pick up. If it was 6pm (required to do 9-5) then it would be net negative.

We are also net negative this month because little one was ill one day and then barred from nursery for a week.

So if I was doing this job for money alone it wouldn’t add up. I am paying to work.