Maternity Pay

[WilliamsJess]

Hello - I’m wondering if anyone has any advice or perhaps is/has been in the same situation as me?

I am 20 weeks pregnant with my first baby, due in early February 2022. I informed my employer of this just after 12 weeks, and they were super excited for me, which was nice.

My employer is very good with many aspects of the job in terms of company benefits etc, for example paying everyone winter gas bill last year whilst we all work from home, bonuses and a generous salary, so I somewhat expected the Maternity Policy to be quite generous as well. Oh how wrong was I…. I have just been given the policy today, and it is literally the bare minimum. 6 weeks on 90% salary, and the rest SMP.

I have some savings, but not a lot and we still have a lot of baby stuff to buy. My partner is self employed and earns good money, about £45k.

It’s really unfortunate as we currently have a lot of outgoings: Mortgage, Household Bills, Car, Kitchen Repayments, my partners Tax Return etc.

My usual salary is 23k, and dropping down to SMP is going to be a massive struggle. I’m considering only taking 6 weeks maternity as I fear we won’t afford any longer than that, especially when SMP still has Tax, National Insurance (which is increasing, thanks Boris) and Pension contributions deducted. I’m lucky enough to have the option to work from home full time, and my partner does also so I feel like juggling work and the baby won’t be that much of a struggle. Hopefully. My company are also really flexible with working hours.

Has anyone else been in a similar situation? Am I entitled to any addition help such as Child Benefit, taking into consideration my partners income as well? I can’t really find any clear guidance on the internet… any advice would be greatly appreciated ❤️

@FrancesFlute

You asked for advice though? In the nicest way, people are seeing ways you could potentially improve your financials before baby comes. They are also politely pointing out that one of your solutions was the idea that you will be able to FT WFH with a 6 week old and that it is probably unrealistic .

Yes exactly, I asked for advice. A lot of people are saying ‘you should have saved more’ and despite my salary, with my current outgoings I physically cannot and haven’t been able to save as much as I would like to.

No, not at all. We don’t necessarily do 50/50 now, he definitely pays out more than I do but I still like to contribute as much as I can.

Well that's good but in that case why is the discussion entirely about what you can afford to save? Why isn't he saving the lion's share of the money to make up the shortfall while you're on maternity leave - he earns much more than you?

Could he get salaried work in addition?

What was your childcare plan before finding out about your employer's maternity policy?

You and your DH need to completely review your finances based on your maternity leave and then salary on your return to work (full or part time).

What we did was pool our income, cover all the outgoings (including childcare, food, savings etc) then split the remainder equally so we had equal spending money. As our lives have changed, I've worked full/part time, not at all, more than DH over the years, we've adjusted our contributions, but always, always had the same individual spending money.

WFH with a baby of any age really isn't possible so start looking into childcare now. I had DC1's nursery placement booked before they were born and it cost more per month than our mortgage. We survived on a family income of £35K at one point, many families manage on a lot less. If you return f/t £68K is perfectly doable.

You do just manage – I am SE so didn't even get the 90% of full pay part, just maternity allowance. We just saved whatever we could before baby arrived and then cut right back on stuff when I was on mat leave. And I took nine months off completely.

Look at your bills, food, deals you have for internet, etc. and see where you can make savings. Look at deferring your kitchen payments or sticking them on a 0% card and paying it off when you're back to work or when you have spare money. Go through everything with a fine-tooth comb and see where you can cut back.

It's worth it - you most likely will not want to go back at six weeks, and you can't work with a baby at home. In fact, the first six weeks is probably the only time I could have done any work as she slept loads. But when she started getting more alert, it wouldn't have been fair on her or my clients to try to get any meaningful work done with her around.

Could any family loan you some money to have longer off work and like somebody else said use annual leave to stretch it out?
Could you bulk buy things now to help out when you are off? Tins of things? Buy yourself supermarket vouchers so that you have money for food?
Cancel anything that is coming up for renewal, sell things, ask for supermarket vouchers for birthdays/Christmas and save them?

What is the total of your outgoings/income?

Could your partner get a second job over xmas to save some money? Not ideal but they're short term sacrifices.

I couldn't have gone back after 6 weeks as I wasn't emotionally ready.
If you HAD to return could you work out the minimum hours you had to work to make ends meet and then work around your partner?
You mentioned bonuses too- you will still be entitled to these when do you normally get them would that help?

KIT days are best worked (from a financial perspective) when you’re in nil pay. You’ll get paid your full daily rate for the day, so doing it on a SMP day won’t make you quite as much.

Eg your get £88 a day gross. You’ll get £21.50ish per day SMP. So working when on SMP will only get you £66.50 extra, whereas doing it when you’re in nil pay will get you £88 extra.

I'd echo what @anotheremma said further up in the thread. I love a good spreadsheet and have found it so helpful to input every bit of spend into a spreadsheet to see where you can save on your outgoings. MSE will have some helpful articles too. Honestly though, 45k is a good pot of money, I'm sure you'll find a way to make it work, and there is no way in earth you can look after a baby and do your job at the same time. Not possible.

Use holidays to extend mat leave but you absolutely can't wfh with a child. The entire nation that got sent to wfh with kids will tell you how unachievable that is. Kids sleep in 40 minute chunks, need constant feeding, changing, entertaining, and help with absolutely everything.

I'd echo what others have said about trying to WFH with a baby (even in shifts). I don't think you can rely on being able to do it and keep your sanity...

Practically though, you'll be entitled to child benefit at about £20/ week if your partner earns less than £60k. If you both earn less than £50k you get full CB, if he earns more than £50k, but less than £60k you'll earn CB but he'll need to pay some back on his tax return. Start cutting everything you can from your budget now before you lose the income. Save as much as you can before the baby arrives.

Babies don't need to be that expensive (the real cost is loss of earnings and/or childcare). Trawl ebay or fb marketplace for bargains every few days and you can pick up pretty much everything you'll need for peanuts. If you look regularly you'll have the best shot at spotting stuff as it gets listed. I think I've saved at least 80% on all the "stuff" including clothes, toys, equipment by buying second hand (I do it more for waste-reducing/ environmental reasons, but saving a fortune is a nice perk!). Also only buy things if you really need them. Some things you might end up buying a few of until you find one baby gets one with (slings, carriers, bottles), but swap or sell anything on that the baby hates/ outgrows. If you can make friends with other mums with older babies they might be happy to chuck stuff at you when their baby outgrows it to make space in their houses for the next wave of baby gear

In my industry, only smp is common. I'm actually only on maternity allowance, as I arrived pregnant at my current job, which means I didn't receive the 90% for 6 weeks. We also have no family locally to help with childcare.

Sorry to be blunt, but why are you only thinking about this now? Our kitchen is dilapidated but there is no way we would have taken out a loan to redo it when ttc.

Having had 2 kids, there is no way I could have wfh and looked after a baby. As pp said, I'd be surprised if your employer was happy with that. The occasional day when your child is home sick sure, but not permanently. The earliest I've known people go back to work is 4 months, with their child in childcare.

Could you take pension holidays, mortgage holiday (talk to a broker before doing this, as this could affect you when you remortgage in the future). Could your dh take on more work (that's what my self employed dh has done). Could you give your notice and do a job at weekends or evenings instead?

Like pp, I don't understand why you are referring to the "tax bill" like it's some added extra that other people don't have to pay. We all have to pay tax on our earnings.

Good luck.

Hi don't forget you have your annual leave .. I saved all mine so I was able to do 6weeks at 90% and then six weeks on full pay and also worked out how long I could have in between that on the statutory pay .. I took four months off in total.. I work from home and categorically could not work with my dd she had to go to childcare.. not doable to work and have your baby and work would not allow it. The last person that tried to do that at my place found herself being put down the disciplinary route.

Is his tax bill so huge because he deferred payment during Covid? Because there is an interest charge for that.

Payments are now 1.5 times the annual amount. So if the £25k is 1.5 times the tax owed then his tax for the year is £17k, so he must have earned closer to £100k, not £45k.

@ChickenSchnitzel

What was your childcare plan before finding out about your employer's maternity policy?

You and your DH need to completely review your finances based on your maternity leave and then salary on your return to work (full or part time).

What we did was pool our income, cover all the outgoings (including childcare, food, savings etc) then split the remainder equally so we had equal spending money. As our lives have changed, I've worked full/part time, not at all, more than DH over the years, we've adjusted our contributions, but always, always had the same individual spending money.

WFH with a baby of any age really isn't possible so start looking into childcare now. I had DC1's nursery placement booked before they were born and it cost more per month than our mortgage. We survived on a family income of £35K at one point, many families manage on a lot less. If you return f/t £68K is perfectly doable.

My plan was to take as much maternity as possible and go back to work about about 9 month to a year. By then I wouldn’t be paying off my kitchen finance anymore as this ends next year, and would be able to save money to put towards childcare and of course would also be back on my full salary.

If his big tax bill includes a payment on account, he can reduce that with HMRC if he thinks he's going to earn less in the next tax year. I did that when I was going off on mat leave, as I knew I wouldn't earn anywhere near what I had earned, so was able to reduce my payment on account (otherwise I would have paid it and then had to wait till I did my tax return for the following year to get a rebate).

By then I wouldn’t be paying off my kitchen finance anymore as this ends next year, and would be able to save money to put towards childcare

But full-time childcare will be much more than £300 a month, which is what you said you'd gain once the kitchen was paid off?

@Hardbackwriter

By then I wouldn’t be paying off my kitchen finance anymore as this ends next year, and would be able to save money to put towards childcare

But full-time childcare will be much more than £300 a month, which is what you said you'd gain once the kitchen was paid off?

Yes, but that £300 a month for me, and £300 my partner will also be saving, on top of my full salary and my partners salary, it would be affordable.

Just to echo others - you CANNOT both work full time and not have childcare.
If you both do a 7.5hour working day, thats 15hours each day. So to make sure you both have 7.5hours of work time, either one or other of you would need to be working between the hours of 6am and 9pm.
That's unrealistic, and I'm sure your employer would not be happy with it either.
Have you annual leave? Can you use annual leave to extend your time off with baby until 3 months, then start nursery as your kitchen will be paid off?

@WilliamsJess I don’t think people were intentionally unhelpful. It’s a fairly common occurrence for people to think it’ll be possible to balance baby & work, and it never works - people were trying to help you realise that now, when you’ve got more options, rather than when you’ve committed to going back to work at 6 weeks and it’s not working.

Get your partner to contact HMRC, if he’s earning less this year and expecting that to continue, he’ll be able to reduce his payments. That’ll help a lot.

I don’t have family childcare either. It’s not the easiest… you have to make do a bit. Have you worked out if tax free childcare can help?

(Thanks to PP who pointed out everyone can do that, I can’t remember your name )

I can't really work out whether this a short-term cash flow issue or if you both spend every penny you get on bills that you can't easily drop.

If it's the former then - and it's not ideal, but better than the 'work full-time around a newborn' thing - you might need to add to your debt for a while; either take out a loan or put as much as you can on a credit card, and then pay it off as fast as you can once this short-term issue caused by the tax bill and the kitchen is gone.

If it's the latter then you need to make a big change: move to a cheaper house, get rid of the car or similar.

Hi OP, firstly congratulations

DH works from home and I am currently on mat leave. Looking after the baby feels like
a full time job even with DH at hand. Some days it's so busy I struggle to find time to get in the shower because the baby constantly needs something. I start making preparations for dinner 4 hours before we actually want to eat because I know I will be interrupted 100 times by baby needing to feed, nappy change, baby needing to be rocked to sleep, baby napping on me which means I can't do anything else. There's no way I could work full time too.

If you go back to work full time I think you will only be able to make it work with childcare in place. Are you able to extend your kitchen repayments over a longer period or take a repayment holiday, so you can save up for a longer mat leave?

£600 a month wont cover full time childcare , and to echo others you can't work and do childcare, especially if a baby, majority of employers wont allow you to wfh and do childcare for valid reasons

@Hardbackwriter

I can't really work out whether this a short-term cash flow issue or if you both spend every penny you get on bills that you can't easily drop.

If it's the former then - and it's not ideal, but better than the 'work full-time around a newborn' thing - you might need to add to your debt for a while; either take out a loan or put as much as you can on a credit card, and then pay it off as fast as you can once this short-term issue caused by the tax bill and the kitchen is gone.

If it's the latter then you need to make a big change: move to a cheaper house, get rid of the car or similar.

Moving to a ‘cheaper’ house isn’t an option. I live down south where living costs are very expensive. We have a mortgage, and actually pay less a month than my friend does renting a small two bed flat. We barely use the car as it is with us both working from home, but even getting rid of that won’t save us loads.

It varies area to area, but full time childcare in my locality would be £1000 per month. Taking that into account you'll actually be better off on mat leave as you won't have a £1k childcare bill.

So you have some time before baby is here, in that time cut back on all non essentials things like Netflix etc reduce your tv package the small things add up. Money saving expert a great site for tips. The supermarkets have baby events on so start stocking up on nappies and wipes buying a few things each payday now so you don’t have to worry about it later. You earn a very good wage between you we managed on much less and didn’t have family help. I doubt that you could work from home full time with a baby but maybe you could do flexible hours? Condense 5 days into 4 or something when you are looking at going back to work could you split it with your partner?