45k salary entirely eaten by childcare

[Sofiewoo]

Granted salaries aren’t what they were only a handful of years ago but aibu to be shocked that my 45k salary is now entirely eaten by childcare and getting to work??
I figured if you are earning in the 20s you would assume that but not mid 40s!

I’m trying to weigh up whether to just take the next year and a half off instead of working for nothing. I know, pension, career blah blah but it’s mentally very difficult to juggle drop offs, work schedules and sickness but be no better off financially at the end of the month.

Did anyone else not realise it was a bad as this?

I feel your pain, OP. I’m in a similar situation, I earn just slightly more, but our nursery charges £1350 per month with 30 free hours. I’m literally paying to got to work when I add childcare x2, petrol, clothes etc.

I keep going because I want to keep the momentum in my career. And I’m telling myself that at least I’m contributing to my pension. Hang in there, it will get better when the eldest is in school (or at least I hope so).

Children should be the priority of a society, not the reasons their parents are ripped off

Also paid holidays, and other benefits your company has. Worth making sure you know about all of them and are getting what you can…

Don't bother working.

Quit, take as many benefits as you can spend time with family. The UK isn't designed for anyone who works.

If you want to have money left over at the end of the month leave the UK, it's not for people who work anymore.

The UK would rather house asylum seekers than provide free childcare.

£45k salary gives a take home of £2,939 per month = £35,268 pa - a lot of incorrect amounts have been posted!

30 Hours of Free Childcare:
From September 2025, working parents will be able to access up to 30 hours of free childcare per week for children aged 9 months and older, mirroring the existing 30-hour offer for 3 and 4-year-olds.

Also check that you are paying all your money into the below scheme you get tax free up to £2,000 per month per child

You can get up to £2,000 per child each year towards childcare costs. The Government-backed scheme is designed so that for every 80p you put into your Tax-Free Childcare account, the state will add 20p. In short, this is what you can get: Eligible parents can get up to £2,000 per child per year. 20% tax up to £2k per month

You get this tax free benefit in addition to 30 hours per wk

I used to think that nurseries were just there to allow you to work but they have a massive benefit in terms of socialising kids ready for school and setting them off in their learning.

As many have said, the impact on pension can be significant, the job market is tough at the moment and although the idea now is to go back when they go to school - you'd then be looking for a job that would work with pick-ups or drop-offs and school holidays which is significantly more difficult to find in a new job than asking for flexibility in a job where you have already paid your dues and proven yourself.

What happens a lot is that women who have taken a year or two off, then can't find a job flexible enough to work around school and pay the same salary so it's still "not worth" it to work and the year or two turns into several or until secondary school. Also, in the meantime, the partner has often taken on more responsibility at work/taken on more hours and it makes it even less "worth it" for them to ask for flexibility and cut hours, so the woman is then also looking for a job that allows pick ups and drop offs and school holidays, and in the meantime the partner gets another promotion etc. etc. ... Without anyone meaning it, one of the couple gets stuck.

If there is any way to request a sabbatical, compress schedules, drop a day etc. I would definitely consider that before quitting entirely.

Also if you ask on money matters on here or the Money Saving Expert forum, you could probably get a good idea of exactly how much not working for a couple of years not working would actually cost you over your lifetime - better to take a decision with all the information as I agree, it's really hard when you're not feeling the benefit now!

Not all of the gender pay gap is caused by maternity leave and childcare BUT it does have a massive impact - if you're looking at losing 300,000 in earnings over your lifetime as a man with the same career and qualifications, it might motivate you to push on through such a difficult time for you!

From https://ifs.org.uk/sites/default/files/output_url_files/BN223.pdf :

"By the time the first-born child is aged 20, the difference in average hourly wages between men and women is about 30%. Of that gap, around one quarter already existed when the first child arrived. Of the remaining three quarters, around half is due to factors other than differences in rates of parttime and full-time paid employment after childbirth. Previous research suggests those other factors could include women being less likely to work in more productive firms, less likely to successfully bargain for higher wages within a given firm, and more likely to enter family-friendly occupations over high-paying ones."

https://equalitytrust.org.uk/news/press-release/calling-all-women-calculate-your-potential-lifetime-earnings-loss/

Older article, but showing that you may well end up earning 300,000 less over your lifetime (that figure doesn't include the effect on pensions):

https://www.theguardian.com/world/2019/oct/28/women-paid-less-than-men-over-careers-gender-pay-gap-report#:~:text=%E2%80%9CWomen%20aged%2026%20to%2035,the%20ONS%20said%20on%20Monday.

It definitely sounds like it might be worth exploring the option for a career break in the run up to when your eldest starts school.

Something like 9 months that runs Jan - Sept could be really cost effective for you. The pay drop is spread across the two tax years so you get the maximum advantage from that side of things. You take your eldest out of nursery and they then go onto school. You line up a suitable nursery place for your youngest for September. You’ve got that September time for doing the phased school start and nursery settling in. If you choose to change nurseries at that point and move to working fewer days you line up with a suitable nursery. And you’ve got a fixed term period that you know is coming, and know is ending.

I work 3 days rather than 5 because financially we’d be no better off with me going up to 5 after accounting for the additional costs. I’m lucky, I work for an employer where I can have a professional role and do it three days. I’m not sure I’d stay sane if I took a two year break to full time mum, as that’s not the way my brain is wired. Others would love it.

This! I took time out until both my children were at school. I had no trouble getting a 10am-2pm part time job when I decided to return. I did both the school drop off & collection. Along with grandparents input during school holidays it worked for us. If I didn't have their support I would have paid a school holidays childminder. I went back to work full time when they left for uni.

£45k salary gives a take home of £2,939 per month = £35,268 pa - a lot of incorrect amounts have been posted! @ukathleticscoach

Well no, they aren’t quite incorrect. While that’s the post tax amount the vast majority of people in 45k plus roles will be paying student loans and then obviously a pension contribution as it’s quite clear by the time those of us who are currently in our 30s reach old age the state pension will either not exist or be so limited it won’t be of any benefit.
So you can knock in the region if £500 off for both those deductions.

Yeah, I get this. But what you lose far, far outweighs the positives in terms of your career.

If financial reward is that important, the best bet is to not have kids…

@Sofiewoo Our kids are the same age, and we had the same issue as you.

We had budgeted for an annual fee increase, but not that it would 20%+.
And we knew it would be tough for a year or so to cover the fees X2, but not that every single time we got additional "free hours" for one of the kids, the nursery would increase the costs across both funded and non-funded days, so that our bill never significantly decreased.

Our solution was to remove them from the private nursery after the latest fees increase in March. The youngest is going to a childminder, and the eldest is going to our local council run pre-school with the childminder for wraparound care. The youngest will go there next year as well as they only take children from 2.

The preschool is free with the 30h funding, and the childminder much cheaper per hour than the nursery. Overall we expect to save £500-£700 a month depending on term/holiday times.

The state pension has increased by a substantial amount because of the triple lock - so much so that it is now almost reaching the personal allowance for income tax. For many pensioner couples £400 per week will cover a great deal particularly as many are homeowners and in London get free transport.
When the pension was brought in it was for men of 65 - life expectancy was average 65 and very few women got their own pension (would inherit DH's pension or widows benefit if DH died younger).

I feel the hardest bit about being a working parent is making that choice between working or staying at home and trying to get back in the jobs market in ten years time at the same level as when you left

Sorry, this is an uncomfortable thing to face but I also believe this is true.

0-3 is SO pivotal in a child’s life.

And with the recent news about nurseries I would be really rethinking this.

Comments like this do my head in - the household income remains the same regardless of who "pays" the childcare!

If the value of the childcare is the same as one income I can see why it would be so depressing - it's not "oh but my husband will pay half so I feel better about our finances", the bank balance is still the same!

@gattocattivo this is me as well.

at one point practically my entire wage went on nursery fees for 2 kids but I carried on working

when our 3rd was under 6 months I became a single parent and , thanks to being in work, was able to buy a home for us and support my 3 kids.

now at 55 I have a decent pension, my home with equity and a nice future to look forward to ( genteel poverty probably) . I’m so glad I didn’t give in to the pressure and financial abuse from my ex and give up.

i love my job even though it’s not well paid and stressful

OP this time will pass and you will be a family on a good income

There may be an element of truth but you are considering one factor in isolation.
outcomes for children are linked to; education of parents, wealth of parents, whether the household is two parents, etc etc. There is so much more to this

I stopped as after my second as I would be paying to work. I had reached a certain point in my career and welcomed the break. I don’t regret it but it would have been very hard to get back into it. I went on to do something else part time when my kids were older.

I can hardly believe how awful childcare is now - the cost!!! When I was a single mum in the 90's after school care was a few quid, negligible really, I had a childminder and holidays cost £100 a week for DS. To think I used to moan about that. Mind you having a second child on my own was out of the question.

It doesn’t change the bottom line, but it also doesn’t make one persons job and earning worthless.

'Well no, they aren’t quite incorrect. While that’s the post tax amount the vast majority of people in 45k plus roles will be paying student loans and then obviously a pension contribution as it’s quite clear by the time those of us who are currently in our 30s reach old age the state pension will either not exist or be so limited it won’t be of any benefit.
So you can knock in the region if £500 off for both those deductions.'

Paying off your student loan is nothing to do with childcare. The op said all her salary went on childcare

Or do what a friend of mine and her partner did: they both opted to do "compressed hours", so they only worked 4 days pw each.

They each took a different day off to care for the children and reduced the nursery to 3 days pw, which saved them a small fortune. And their income wasn't affected.

Agreed, it makes posters look daft when they spout this. It's family income. Do these posters actually think that magic money suddenly appears if they pay half and their OH pays half. It is the same money.
As with most things on mumsnet it is just a reason for some posters to try and make every situation the man's fault.

Of course it does, it’s a graduate tax that comes out of your salary before it’s paid to you therefore you receive less money.
The majority people at the age of laying childcare and earning salaries of 45k and up will be have student loan reductions. It’s disingenuous to talk about a salary without normal deductions.
I can’t just choose not to pay student finance now that I have a childcare bill.

I said almost all of my take home salary went on childcare.

No she didn't. She actually said that what she earned was the amount that childcare amd getting to work cost. Most people on 45k will have student loans. Of course it has to be taken into account. OP has a gross of 45k once normal deductions are taken off OPs family would probably have the same if not more money per month of she didn't work. We shouldn't be accepting that as the norm.

'Of course it does, it’s a graduate tax that comes out of your salary before it’s paid to you therefore you receive less money.
The majority people at the age of laying childcare and earning salaries of 45k and up will be have student loan reductions. It’s disingenuous to talk about a salary without normal deductions.
I can’t just choose not to pay student finance now that I have a childcare bill.
I said almost all of my take home salary went on childcare.'

No thanks for pointing out that your free hours will increase for the 2nd child in Nov just arguing.

A student loan has nothing to do with childcare fees at which point it is deducted is irrelevant. You are factually incorrect and just wasting my time. Bye!