Childcare can cost thousands of pounds a year but there are many ways to save
It’s not unusual for the cost of nurseries, childminders and after-school clubs to be one of the biggest monthly bills for parents.
Anyone with young children knows that the cost of good quality childcare is often second only to the mortgage or rent.
Nursery fees have risen by 52% over the last 10 years, according to TUC research, while earnings rose just 17%.
In fact, it now costs an average of £232 a week for a full-time pre-school nursery place, taking a pretty sizable chunk out of parents’ earnings.
But there are ways to bring the cost right down. Here’s what you need to know to pay less for childcare:
Sign up for tax-free childcare
Let’s start with the most obvious; there is government help available to you even before your kids are old enough to qualify for the 15 or 30 funded hours.
Signing up for a tax-free childcare account could save you up to £2,000 a year per child. You pay money into an online wallet and the government tops it up – for every £8 you pay in, the state adds £2. It’s effectively refunding the basic rate of tax you’ve already paid.
You then pay your provider from the online account, meaning that for every £80 you spend, you can buy £100-worth of approved childcare.
Once you qualify for the free childcare – usually your child has to be 3 or 4 and you have to be working 16 hours a week minimum to get the full 30 – you can still use tax-free childcare to pay for any additional hours you need, or for after-school clubs for older kids.
Ask your boss to be flexible
You might be able to save on childcare costs by changing your hours. Perhaps you could pay for a reduced nursery day or avoid paying for after-school club by fitting all your hours into four days and having one off.
Perhaps you and a partner or another parent could take it in turns to leave work early and do pick up – catching up the hours on another day so it doesn’t hit your income.
Most employees have a statutory right to ask their boss for flexible hours, to help them fit their job around commitments like children or caring for relatives.
Your employer has a legal duty to seriously consider the request to see if they can make it work, so don’t be afraid to ask.
Find some friends
Some parents are lucky enough to have family close by, including grandparents who are willing and able to help with the school run or by looking after younger children while the parents go to work.
But not everyone has that option available to them and the trick here is to find friends and form a support network.
There will be plenty of other parents on your school run who would like to avoid the cost of after-school clubs, so find out who is in a similar position to you and see if you can take it in turns to pick up.
And if you have nursery-age children then maybe there is another parent you know and trust who could take it in turns with you to collect the children at an earlier time to avoid paying for a full day.
Just bear in mind that the rules around this kind of reciprocal childcare are quite strict. Legally, a friend can’t regularly look after a child under 8 for more than two hours a day unless they’re registered with Ofsted as a childminder.
A family member doesn’t have to be a registered childminder as long as you’re not paying them.
Form a babysitting circle
It can be hard to arrange a night out if you know that, as well as the taxi, you’re also going to have to pay a babysitter.
But if you have friends with children a similar age then developing a babysitting circle where you all take it in turns can save you some serious money – and make it easier to get out at all!
This shouldn’t fall foul of the ‘two hours a day’ rule because it’s not during normal working hours.
Formalise your funded hours
If your child is soon going to qualify for the funded hours then make sure you’re ready. There are forms to fill out and you will need to check your nursery can accept your child for the specified hours.
You will also usually need to wait until the term after your child reaches their third birthday for the hours to kick in.
Speaking to your childcare setting ahead of time will help you know exactly what you can expect and when.