How are families able to afford the cost of childcare in the UK?

[zai10]

I moved to the UK 4 years ago and I just can't believe how expensive childcare costs are here. I cannot wrap my head around how even people with good salaries manage, let alone if you have more than one child or you are a single parent. However it's not a topic that I hear people complain much about.
Am I missing something? What are your experiences with this?

Thank you for your insights!

There is lots of government help towards childcare costs, more than anyone has had previously.
Id be interested to know how other countries manage to make childcare cheap - is it state subsidised in another way?

I’m not sure how people afford it. I can only afford fees for 1 but cost of 2 sets would outweigh my salary.

i wonder how people afford more than 1 set - potentially government help or they go into debt for a while. Or they are high earners with generational wealth.

We just have to suck it up. Parents in receipt of UC can get 85% of childcare costs back.
I am cheering for the news about breakfast clubs today :)

My entire salary is on childcare. We get tax free childcare and funded 15 hours but with two children in full time nursery it doesn’t really touch the sides

There isn't lots of government help at all.

20% tax relief up to £2k per annum per child and a year of preschool (often just three hours a day) is the extent of it here. They've recently added an extra 15% tax relief, this is the first month of it.

I know England has the so-called funded hours but a few minutes of reading on here tells you that the funding provided doesn't come close to covering the providers' actual costs and so they charge top up fees and the saving to parents is minimal.

Meanwhile the evidence suggests that funded childcare keeps women in the workforce and has a net benefit to the economy.

And then the women (and it is women, perhaps it would be different if it was men) who do this difficult, important, skilled work are paid a pittance because despite families being on the brink to pay the fees, they still don't cover anything near what the staff deserve.

It's broken.

The government system is an absolute mess of a system, I agree @BarbaraHoward but it does help many families, and it’s a level of financial assistance that wasn’t there for families 20 years ago.

I used a child minder rather than a nursery. Less expensive and someone wonderful who became a long-term friend

I only had one child

For the two years 2010-2012, I paid full time childcare, I went nowhere, did nothing, just paid childcare and worked. It wasn't the easiest two years.

At its height, nursery was double our mortgage. Still not sure how we did it!

I have 2 brothers and a sister in various parts of the USA. Full time daycare is costing around $100 dollars a week. You can get a private nanny for what people pay for a cheap nursery or childminder in the uk (I’m currently in the north west of England).

We have one kid almost entirely due to not being able to afford to put two in. Back then it was 3 (maybe 4 but I don't think so) before you got 15 hours free and as we had a childminder, we had to pay half of it anyway to hold the spot. Later we moved childminder and as it was a bigger group we used the 15 hours free there. Before and after work inc holidays was £500 a month and we couldn't afford or justify another full time on top of that. By the time we could afford it, DD was 10 and the time had passed really. Ee didn't have bad wages back then either.

I'm glad there is more help available to those who work now but it still barely seems affordable.

By contrast, my friends who had family to help or were in receipt of benefits have been able to have more. I think that's the difference in all honesty... takes a village etc.

With great difficulty.
it makes going back to work difficult.
my cousin went back to work but found it too much a struggle so has stopped working again as the benefits she receives when not working leaves her better off financially.

I am basically working to pay childcare 😭

I know England has the so-called funded hours but a few minutes of reading on here tells you that the funding provided doesn't come close to covering the providers' actual costs

Absolutely. I have a horrible feeling it’s going to be the same level of funding for breakfast club. My HT has already said we won’t be able to run one free if it’s not funded adequately, it would finish our budget off completely and we simply don’t have the space.

Even in 1984 with our first child we spent 50% of our net pay on full time childcare for a new baby - used a daily nanny. It was cheaper when we had 3 children under 4 in full time childcare to use a daily nanny than 3 fujll time nursery places (we both work full time). Roll on to 2024 and I have grandchildren. It can cost £50k a year for 2 babies in a London day nursery full time or £60k a year due to employer NI and pension etc etc for a daily nanny.

I know a lawyer who moved from somewhere in Scandinavia with his wife - both work full time - and their childcare cost sin London were TEN TIMES what they were paying at home.

It is not as if we have low tax as a result. Those in the top 10% in the uK - over £67k a year pay - have the highest tax burden in seventy years. Also if you dare to be a higher earner like a doctor etc then you do not even get the "30 free" term time hours thing, never mind child benefit

In other countries it's more considered as a basic right and it's a lot more subsidised through taxes although there are levels depending on the country. Nevertheless it's much cheaper than the UK which i think it stands as one of the most expensive ones in the world together with the US and Japan

It’s even worse than that if you’re a higher earner.

You pay up to 60% income tax and at the same time lose the 30 funded hours and also the access to the tax free childcare savings scheme.

It means you end up in a situation where your effective marginal tax rate is 100% or possibly more. You need to increase your income by at least £30,000 to be a single £1 better off after tax.