Bridging the financial gap

[Peppersneeze]

Any tips on where others have found themselves short between returning to work, nursery fees, reducing hours.mm and awaiting the blessed 30 free hours childcare? Currently exploring credit card options, obvs done a budget & lowering outgoings... anyone with experience care to share how they coped?

Does your employer offer interest free loans?

Does your nursery offer temporary financial assistance?

Can you or your partner work more hours?

Or can you both flex your hours to minimise the amount of childcare needed?

For example one work M-Th and the other T-F, plus maybe one start early and the other later, so you can do shorter days in childcare.

Otherwise, ruthlessly review your finances to reduce other costs, eg food, broadband and TV, car costs etc. Look at the money saving expert money makeover.

Tax free childcare helps us manage. It's a 20% top up from the government up to £500/quarter. It's a bit of a faff to apply for but well worth it for £2k we wouldn't have otherwise.

Tax free childcare and both working as many hours needed to cover childcare comfortably.

Won’t help you, but lots of people save ahead of having a baby for this phase.

Obvious cost savings - no takeaways, no holidays, get rid of subscription services like Amazon prime, Netflix etc. Stop paying for hobbies. Sell car and get a cheaper one. It’s only for a short period, so bearable. Lots of people can save quite a lot if they are prepared to live really frugally. But lots of people find it difficult seeing luxuries as necessities because they’ve got used to them.

Run your numbers as accurately as you can with last few statements to see where money is going. Also check the terms of your 30 hours and how nursery runs it so you’re prepared. I found that on a day work funded hours, we could use 6 max per day, still then had to pay for food and other things so really had a 50% fee discount term time only. The costs will not stop at school age if you need wrap-around - could be £3-4k but will be much lower than nursery. Lots of people (including me) underestimate the cost of wrap around.

I’m still paying of nursery fees (in the form of a loan) and my dc are 8 and 11

I suppose what is reasonable in terms of cutbacks, loans etc is dependent on what you current position is.

If you currently have quite a lot of discretionary spends that you could cut back on, borrowing to keep up with such a lifestyle would be silly.

However if you are genuinely short of covering the basics, spreading the cost with interest free credit cards or a low rate personal loan could be the least worst solution, especially if you are in secure jobs with an established career path that will see your income increase.

Bear in mind that utilities and national insurance are due to rise, which could further squeeze your budget, especially as other costs will consequently increase - the childcare provider are likely to increase their rates, because their utilities and staff costs will increase, eg over the last few years, NMW, which childcare workers often earn, has increased significantly in percentage terms, which obviously has a knock on effect on the cost of the service.

But don't, whatever you do, consider what someone faced with this problem recently asked, which was to stop pension contributions.

For a comprehensive guide to reviewing your budget, have a look at Moneysaving Expert:

www.moneysavingexpert.com/family/money-help/