Can I afford to be a childminder?

[chwedl]

Hi there,

Having had a bad experience with my daughter's childminder I'm seriously thinking about becoming a childminder myself and would appreciate any advice on costs etc and if I'd be able to afford it!!

I currently work 3 days a week and bring home £202 a week after tax and NI. On top I pay a childminder £105 per week ( some of which I get from tax credits). So my net income from my salary alone is roughly £10,000.

An average childminder's rate around here is £30 per day. So my thinking is that if I work for 5 days a week, having 3 under 3's then it's £450 per week. I know there's the cost of food for each, I'm guessing say £10 per child per day, which would be £150 per week ( do childminders get this money back?) Plus do you get a full refund for any buggies, toys etc that you buy?

Thinking like this (I know that it's a very rough estimate) then it means that I'm better off, sure I work more but I get to be with my daughter too.

What do you guys think?

Also as I'm a single parent with a mortgage I'm relying on my money alone and don't want to be doing anything that means I can't afford my house!!

Well you will only have 2 children under 5 surely because of your child

No you take those expenses of your profit and pay tax on what is left (who would refund it?)

It's quite hard work & there is new training evenings & weekends all the time

don't underestimate working 5 days a week 8-6 with 3 under 3

and dont think childminding is easy either

I'm not a childminder so can not overly advise on this. However I have spotted that you missed a detail that may be needed: How old is your daughter?

There is a document from HMRC about expenses that a childminder can claim, may answer some of your questions: HMRC: Childminders 2011-12 Information about Tax and National Insurance (pdf)

Both my dds are childminders, firstly remember if you earn over tax limit you will have to pay tax, this means you have to earn a lot to be able to afford to pay tax. Both dds try to keep what they earn below the tax limit they are then entitled to working tax credits which tops up their money.

Anything you purchase you save receipts and can claim as expenses on accounts.

All the children my dds look after bring their own food.

Remember you have to be qualified, registered and will be inspected by OFFSTED. It is not a job to go into lightly.

i earn below the tax limits and dont get working tax credits

are your dd's single nana?

I totally agree that it is not a job to take lightly. I've thought about it on and off since having my daughter. I have years of experience in working with children, and coming from a large family know only too well what is involved in caring for children. I would enter the job and give it my all and think I'd make a damn good childminder even if I say so myself :) Perhaps my post seemed flippant, sorry!!

What I'm trying to say is that I know how hard it can be but my whole career has been working with children and I get a lot of joy from being around little ones. I'm not looking for an easy way out, I know that this is not the case, what I want to know is if I can afford to do it! I don't want to be rich, just have enough money to be able to afford to live!

No-one can really answer that question. As others have pointed out, you can only have 3 under the age of 5 and 1 of those places is already taken up by your own child.

You also seem to be looking at the BEST possible scenario - all your places taken up full time. If I were you I'd look at how you can cope and afford with the WORST case scenario.

You would be self employed and with that comes risks - you can't assume you will have £60 a day from those 2 places. Your hourly rate for one child will be well below the minimum wage - I'm just starting out and only have one child on my books at the moment for just a couple of mornings a week. I work bloody hard and do loads with him, all for the princely sum of £3.50 an hour. And of course because I've taken on a child for a couple of 1/2 days that's one potential full time place gone - but I couldn't afford to just hang around and wait for a full time place that might never come.

On the more positive side, in the area of Wales where I am starting up costs nothing - the course is free and you get a start up pack from the NCMA for free and this includes a fire blanket and a year's worth of public liability insurance. You can also claim a grant of up to £100 (I think) for safety equipment - but this has to be stuff that your CSSIW inspector says you need to have.

Before you do anything else I'd check whether this is the case for you too where you live and also have a chat with some of the Childminders in your area to see how much business they manage to get.

Do you have quite a lot of savings - if you had no income for 6 months, could you live off savings?

I think you may be asking us to look into a crystal ball and predict the future. We can't know how many childcare places you will be allocated on your registration inspection visit, or if that number might be increased at a later date. We don't know if you will be able to fill all your childcare places - at the moment I get the impression that many childminders are not 100% full... may be just in my area, or it may be more of a national issue.

It's not as easy as saying I'll have 2 all day 5 days a week, not everyone needs every day, I have 2 children 2 days a week (plus my 2 year old) and 1 the other 3 days, I also have others after school and holidays none of which are full time. Also it's not guaranteed income, any time a parent could stop working/be made redundant etc and then you loose a big chunk of income quickly.

All your resources are to come out of the money and you can put a percentage of your utility bills through your accounts too (but you will probably use more if you're used to being out). I work a 60+ hour week when I used to work part time, it's exhausting but I wouldn't do anything else as I want to be with my own children.

Would you have any older ones before/after school? Around here, CM's who do wrap around are like golden hens teeth!

ssd one of my dds is single and has a child and gets working tax and child tax credit. My other dd lives with fiance and his family haven't got working tax yet but when she tried to claim a few months ago was told more likely to get it when new tax year starts as her earnings last year was so low and her fiance is on low wage.

chwedl, not trying to put you off just giving practical advise both my dds love their jobs and wouldn't consider doing anything else. One draw back at the moment is the voucher scheme for nursery places for 3 year old means they often "lose" children at 3 because they can't offer voucher scheme and can't find out how to go about being able to offer it nobody seems able to offer help on this.

Yes I'm looking at the best case scenario, but the area that I live in is screaming for childminders! Every one I know is fully booked, but you're right, a lot of people work part time and so realistically I'd be looking at £180 per week to begin with maybe ( 2 children 3 days a week). It's just weighing up what's manageable. Now, childcare accounted for, I'm getting £145 per week so I'd be roughly in the same boat, which is fine. Does anyone know if tax credits would be available to me? If not I'm chasing a pipe dream I think!!

lol @ ChippingInNeedsCoffee! I would definitely do before/after school, not sure how much income you get from this but I'd do it regardless. I don't have savings so I'd need to be fairly confident of work before handing in my notice. I'm not sure where you all live but in my area all available childminders are fully booked or have 1 days only available (believe me I've searched!) I also know that a childminder in my area who's going through the process of registering has a full waiting list and she hasn't even got her date yet. This is the reason that I'm slightly more confident of getting work. Around here the voucher scheme (as I have used for my daughter) is being used for the playgroup which is attached to our local school. Children of 2 1/2 can attend and it's common practice for children in the area to go.

Not sure about tax credits as I said one dd gets it other doesn't at the moment. They use previous years earnings to work out not what ypu will be earning in coming year which is why dd can't claim last year was working fulltime and even though they knew earnings would be low this year couldn't claim hopefully when new tax year starts she will be able to claim.
chwedl you can phone tax credits they wil tell you over phone if you are entitled.

Only if life were that simple

You will prob find parents needing part time places

Also you need to think about dd sharing your attension with other children in her home, most cm will tell you the job gets easier when your own children are at school

It can take many months to register and do all the required training, so unless you have a lot of savings, you may need to find childcare in the meantime in order to continue working. If the "interim" childcare works well, you may find you no longer have a good reason to take up CM.

Have you thought about holiday pay? If you decide not to charge for your own holidays & bank holidays you will need to set aside money to cover this. You mentioned having two children for 3 days a week each and earning £180. If you take 4 weeks unpaid holiday each year that will bring this down to £166 per week. If bank holidays are also unpaid it will be even less. I budget about £5 per day for a full time child for food. So you could then be down to £136 per week. That doesn't include any other expenses or tax and NI. By the time these are factored in you could be quite a bit worse off than now.

Also, there are lots of little expenses that you may not have considered. At the moment my biggest monthly expenses after food are for disposables like paper hand towels (Ofsted don't like shared towels), ink for my printer, pogo paper for printing out photos for daily diaries and learning journals and art and craft materials. I didn't take these types of expenses into account when I was registering and have been quite shocked at how much it is all adding up to.

Childminding can be a lovely job but you will almost certainly earn less than you expect.

I'm not sure how much you all spend on food for yourselves for the week, But OP considering we feed 4 all week on about £80 I am shocked you think that a child could add up to £50 for the week. You could do it for a lot less if you cook from scratch.
You need to think about whether you would expect the parent to provide nappies, whether you would charge them extra for going to playgroups etc.
You need to consider what happens if you or your DC is ill and you cant work - ie you will not get paid.

There is a tax calculator on the HMRC site to see what you would pay in tax and NI.
Re the towels - I had a separate flannel as a towel for each child. Ofsted was happy with this.

Can I just second what mopbucket said about your own daughter sharing your attention with other children.

I used to childmind whilst my DS was little, it was very hard work trying to be fair to all the children. He quite often resented other children playing with his things, being in his room etc. So I decided to stop minding.

I took up minding again when he was in secondary school and now its completely different, more relaxed and he keeps out the way.