Worried about maternity pay and child care

[MSG92]

Hi everyone, firstly, I am so happy to be pregnant, wanted this more than anything. Me and DH have been together over 10 years, moved into our forever home last year, quite financially comfortable albeit not well off but we pay mortgage, cars etc and have money left to save. I started freaking out recently at the thought of childcare etc. I get 90%pay for 6 weeks followed by 12 weeks at 50% + stat so I think this should be OK, but when it goes to just statutory I am now freaking out about what we're going to do, I don't want to go back to work full time when baby is 18 weeks old! Plan was to save the next 7 months and top up statutory with savings, but then we thought it might be better to clear some outstanding finances (2 cars and kitchen) to bring monthly payments down. On top of that, when I do go back, child care is astronomical, we don't have family nearby, they live over 2 hrs away. Anyone else having this concern or got through it by thinking of something out of the box? Please no sarcasm or rude comments, we have both always worked FT, not entitled to any benefits and never have had any, as far as I can see the only time we get help is 3 year old 30 hours a week. I know it'll be OK as loads of people with less manage I just don't know how!

I finished maternity leave in April at 18 weeks. I'm the main earner and was on flat SMP after the initial 6 weeks.

We saved for 6 months while pregnant but in all honesty by the time my maternity was over, we barely made a dent in the savings as we just didn't spend it.

I also did a KIT day every week from 8 weeks which topped up the coffers a lot. You don't need a baby class every single day etc so you save there. You get given so much stuff too - just welcome it with open arms.

One thing to bear in mind is if you take less than a year's leave then you will pay less income tax. I took 9 months leave and got a tax refund for the other 3 months in that tax year which was a nice chunk of money!

@Sceptre86 yes because he works shifts (including nights) 2 cars is necessary, unfortunately. We both work 45 minutes away, me more sociable hours, but can range from 7am starts to 8pm finishes, I do what my job needs, and he does 6.30-14.30,14.30-22.00 and 22.00-06.30.

I've got about £4,400 in savings currently. I am clearing my credit card next month using savings (£1800), it's interest free until Jan, but I haven't used it in about 6 months anyway, we got it for our holiday last year. Then I'll use the rest of the savings on paying a chunk off 1 of the 3 monthly payments (2 cars and kitchen) to bring down the outgoings a bit. Then of we save about £500pm from now until July that should give me another 3-4 months of maternity. I think DH is also getting some money from his dad as his nana passed away, just depends how long it takes to go through... My mum is giving us £500 for whatever we want, baby stuff or clear debts.

One thing a few people have mentioned, DH and I do jot treat are money separately, we don't split bills etc, well not really as all our money is shared, bills come out of my account but he puts money towards them, he does the saving which we used to use for holidays etc. If I need money I just go into his account and take some and vice versa. I'm lucky, he has no care for money or expensive things and trusts that I'm doing OK if all bills are paid and we can afford a takeaway occasionally!

Honestly, my main concern is paying for childcare when I go back, I will do 4 days, hopefully his dad will help out 1 or 2 days, but we can't trust him with a tiny baby haha which leaves 2 days to pay for. Doesn't help I don't know anything about babies so when my colleague said work from home with the baby 1 day a week as well, I thought how can I, surely they'll want feeding, playing, changing and I won't get work done!

I'm going through the same OP. Its so tough isnt it? I couldnt believe how low statutory mat pay really was. It wouldnt even cover my mortgage

I also earn more than DP so it'll definitely be a struggle. My aim is to save enough to cover the mortgage for 6 months at least, then whatever pay I get will go towards living and bills I guess. DP will just have to do some overtime also. Everyone says it works itself out but its such a worry. No benefit bashing at all from me but I would be better off being out of work and on UC because DP is a low earner, which is crazy to me. Hey ho, hopefully it all works out

@Parkandride 🥰

Another tip I heard if anyone is paying back a student loan is to claim back your payments towards the end when you are running out of cash? Some posts suggested it was automatic not to pay your student loan once your earnings dropped but some said it was worth a check.

You can so claim £6 expenses a well this year for working at home - I got £117 back and it went towards the car seat🤷🏽‍♀️

Vitality health policy holders (personal or via work) get £250 cashback when you give birth using the NHS. Every little helps! X

Firstly congratulations on your pregnancy! Clearing finance is probably the better option because at least then you know you’ll have less joint outgoings when you’re on mat leave.
With regards to childcare - our plan for our son on my return to work was 2 days at nursery and 3 days with different family members. Due to covid we didn’t want to risk the safety/ health of our family members so he’s been going to nursery 5 days a week since I started a new job in July where my shift pattern changed. It’s obviously a lot more expensive but I was told about the gov.uk childcare tax free account that you can apply for 4 weeks before you return from mat leave and as long as the childcare setting is registered then you received tax free childcare (as long as you earn under £50000, I think) and it really helps. You get a limit of how much tax free you can get but I think it works out £2 back for every £10 paid in so definitely worth looking in to.
You’ll honestly be fine and you’ll manage because there will be people who are in much worse situations who still manage.
Your priorities will change and you’ll save money elsewhere too. Try not to worry, and enjoy your pregnancy.

Also download an app called “top cashback” and then before you buy things for the baby check if you can get any cash back on certain websites. It all the accumulates in the account and you can transfer it out once it’s payable. Sometimes it’s not much but it all adds up!

Thanks @Humpty11, yes I have topcashback now, use it for Christmas presents etc.

I have been thinking this evening, maybe i should use the £4400 to pay of DH's car which is currently £190 per month, and transfer the £1800 on the credit card to another interest free one... I don't use the credit card month to month, it was for a holiday in South America last year, and I think £400 of car repairs! Do you guys think that idea is better than clearing the credit card and a chunk off a monthly outgoing? In theory I could pay the minimum payment each month and just take ages to pay it off

£190 sounds a good amount to not pay each month. General debt advice tends to be okay the most expensive debt first so I'm not sure if that's obvious (hard to know percentages sometimes!)

@MSG92

Thanks *@Humpty11*, yes I have topcashback now, use it for Christmas presents etc.

I have been thinking this evening, maybe i should use the £4400 to pay of DH's car which is currently £190 per month, and transfer the £1800 on the credit card to another interest free one... I don't use the credit card month to month, it was for a holiday in South America last year, and I think £400 of car repairs! Do you guys think that idea is better than clearing the credit card and a chunk off a monthly outgoing? In theory I could pay the minimum payment each month and just take ages to pay it off

When is the car due to be paid off fully and is it a lease hire? It's worth working out if you're better keeping savings high or using part then how long it will take you to get back to that level before nursery fees kick in.

I switched to different 0% card and changed the payments to above the minimum but not difficult (£50/month). Even though I had it in savings having the buffer was more important than clearing the card

Loads of great advice on here OP - I'd also just echo again what's been said about buying second hand for baby. Everything apart from car seat and mattress is fine. I've got a huge bundle of baby clothes for £10 and a lovely pram with bassinet and toddler seat, hardly used, for £20 - both FB marketplace. Have friends who've spent over a grand on their prams and baby outfits! Incidentally when I went back work with our son we also posted on local parenting FB pages for nanny/childminder recommendations and found my son a brilliant nanny that way - she had him 1-2-1 (with her 2 kids before and after school) for reasonable money and he LOVED her and it was a great experience (I'd done my due diligence on her insurances and certificates of course - it was a situation where she was going back to her previous career after a breakup and wanted to start small initially). So even if Google isn't showing up any childminder options, posting for local recommendations can turn up unexpected gems! Best of luck.

I don't have much by way of practical advice, as I think there has been lots of good stuff above already. To one of your points about working at home with the baby one day a week...I don't know at what age that becomes practical but mine is 20 months and there is no chance I would get anything done while minding her!

Just to share my current experience, I've been back at work about 9 months (with the Covid break in between), and the cost of childcare is an absolutely massive hit. I just try to remind myself of two things: 1) there is nothing that I pay for that is more valuable than the care of my child, and 2) this is a short term hit until she goes to school that allows me to preserve my career/ pension.

Good luck and congratulations!

Don't forget OP that you and dh can share the Leave. Parental Leave means both can take a share. So if he gets better entitlement than you, and you struggle, you could return to work at 18 weeks and he take the next six months off.

Lots of great advice already OP.

I would just say you will manage, you just do.

I have twins and was absolutely terrified how I would afford it. I only get SMP so 6weeks of 90% and the rest is £150per week (last 3 months unpaid).

So during the pregnancy we reduced down all our debts as much as possible, checked all our outgoings were as low as possible and saved £5k.

We have managed throughout. I mean lockdown has probably helped as we haven't been able to do much but we actually have over £3k left in savings and I return to work next month after 1year off!

You accrue all your annual leave whilst on mat leave so my last month I am using up 27days holiday so only had 2 months unpaid.

Try not to worry too much it will all work out in the end. Enjoy your pregnancy OP!

Save save save save save save

Totally agree with @babysnowman childcare costs are a necessary evil to keep your foot in the door at work.
My DH said to me that if we are spending out on childcare then we needed to look at where they would be happiest not just where would be cheapest.

Re finances, as it's seperate banks, what's the plan when you go back to work? Whose bank is it coming out of? You need to make sure you're not paying it all and then having to go to him for cash, he should be jointly responsible for the costs.

Also makes no sense why someone I know gets free child care at 2 years old because she works 2 days a week whereas people who work full time and actually need that aren't entitled! Seems a bit arse backwards doesn't it! She isn't getting free childcare so she can spend time not having to see her child or rewarding her for not working as hard as you. The child is getting early hours education as children in certain circumstances, of which low income families are one, are thought to benefit from extra intervention

This is such a refreshing post. We are due in May and I feel very lucky to have 6 weeks 90% and then 20 weeks full pay. We also have no family near by (closest is 2.5 hours away). I plan on using my annual leave to go back 3 days a week until Jan 2022.

How do KIT days work? I have 10. When I use these does it ‘pause’ my Mat leave as such? So I get an extra 10 days leave?

I am going to attempt to wfh with a newborn (partner does 4 on 4 off shifts) so won’t be every day. Then at 2 they get 15 hours free now?

So much to get my head round!

Kit Days essentially eat into your Mat Leave but you get paid full pay for them so depending on what pay you get the 20 weeks full pay, you'd want to use them then.

If you both work you don't get free hours until the term after they're 3

@SleepingStandingUp what do you mean by eat into your mat leave? If I am being paid full pay for 20 weeks, there is no incentive for me to use KIT days to ‘work’ during those 20 weeks if I am already being paid in full for those days. I doubt my employer will pay me an additional day rate for those days?

I will check with HR in Jan :(

Just read about the 2 year old thing, unlikely we will qualify for the 3 year olds 30 hours free either by the time we get there!!

My understanding and I may be corrected if that it doesn't add days on.

So your 9 months ends Dec 31st 2021, you still go back then but you would have have up to 10 days bear the end on full pay.
If you're having 6 months all on full pay, ask of its possible to have 7 months perhaps and do the last month with half on kit days and half on the lower pay?

Why won't you qualify for the 30 hours? You get 15 at 3 automatically and as long as you both work you get topped up to 30

@SleepingStandingUp

We will only qualify for 15 hours as I earn close to 100k now and after 3 years I’ll have had pay rises that take me over it so we won’t qualify for all 30 hours.

I will ask HR about KIT days as I don’t want to work 10 days in my 6 months off for effectively nothing. I’m pretty sure I can just use them if I want them so might use half!

@Scottishskifun it's not lease, when it's paid we own it outright. It's due to be paid March 23, so figured pay that off now instead, then credit card £100 per month until mat leave starts then reduce to £50pm, will be £140 a month better off when my pay reduces and when I go back to work so we have extra for childcare.

@WoolyMammoth55 thanks, I don't have FB but will definitely get DH to look for a local childminder, I found one 4 miles away now but no idea of availability or fees so it's good to have multiple options.

@SleepingStandingUp I have full access to his account on my banking app, we're with the same bank. Because of his previous job, he was in the army full time and away 15 months out of 24 so we signed something at the bank which means as soon as he gets paid I go in and take what I need and I can transfer back if necessary, as we get paid 1 week apart so sometimes I run out sooner sometimes he does. We just in no way have our own money, even when he was earning £600 a month more he has no care in the world about it as long as I pay bills and he could afford a few drinks whilst he was away he was happy haha.

@Twobecomingthreeplusthedog I think, if you wanted to stay off longer than 6 weeks + 20 weeks then you can use those KIT days after that, so it's a way of topping up statutory if that's what you go down to, or you can use them to go back part time for a few weeks.

Thanks everyone. It really is helpful to just hash these things out with people. I feel more relaxed now I have a plan to reduce my outgoings!

[quote Twobecomingthreeplusthedog]@SleepingStandingUp

We will only qualify for 15 hours as I earn close to 100k now and after 3 years I’ll have had pay rises that take me over it so we won’t qualify for all 30 hours.

I will ask HR about KIT days as I don’t want to work 10 days in my 6 months off for effectively nothing. I’m pretty sure I can just use them if I want them so might use half![/quote]
You would still be entitled to 13 weeks smp after the 6 months of full pay so KIT days are a brilliant way to top up the pay for this time.

You can do them at any point but wouldn't get extra pay for the days you did them if already on full mat pay hence they are best when pay drops.

My last mat leave I did 3 days per month when I dropped to smp, the combo of kit days smp and tax back actually gave me enough money to barely have to touch savings. My mat pay is very generous of 6 months full pay.

I will be doing the same this time as well.

They aren't obligatory @Twobecomingthreeplusthedog l, they're useful for keeping up to date and topping up the money. If you are happy not doing them given the money isn't an issue I wouldn't worry