Being a mum and making the decision to go back to work, even on a part time basis, can seem like a daunting task. You have spent months – perhaps even years – looking after your young family and now it’s time for you to head out to the workplace again because you feel ready and you know your children are ready, too. But what about the childcare costs for working mums? How can you afford to go out to work and ensure your children are well looked after in an affordable way?
We know that there are many advantages for mums who choose to go back to work part time after having a family but, for many mums, they are put off the thought of returning to work because they are unsure of the childcare options out there and also, the financial cost of that care. If you do your homework beforehand, however, you should be able to come up with a solution that is best fit for you.
The good news is that there is help out there for those of you that want to make going back to work part time financially viable. It’s true that the United Kingdom has some of the highest childcare costs for working parents and this puts some parents off the idea of heading back to the workplace. However, the government has various initiatives to help with childcare costs so more parents feel they can go out to work.
Do your research around these initiatives to check that you meet the criteria for the scheme you like the idea of. You also need to be aware that, for some schemes, if you opt to be a part of it then you might lose your eligibility to claim financial help on other schemes you might already be making use of.
Choosing childcare and paying for it is about finding the best fit for you and your family. It goes without saying, of course, that as a mum, it is not just about the cost of the childcare but also the type of childcare that best suits your child – their personality and the environment you want them to be cared for in.
The key is to make sure you are claiming the financial help you are entitled to whilst you are working part time and your child is being cared for. There are parents out there who are missing out so do your research. Below, are some suggestions to help get you started with your research. Find the right one for you and you could soon be back in a part time job and making your finances work for you and your child.
If you are interested in the Childcare Vouchers route, you will need to to take action soon as they will no longer be available after April 2018. You will need to speak with your employer about using this route. Childcare Vouchers are useful because they reduce the amount of tax and National Insurance you pay on childcare. This, of course, makes working more financially viable.
Depending on the type of part time job you are doing, some employers also have a staff nursery where your child can be cared for. You pay tax and National Insurance on any financial assistance your employer gives you for childcare.
Tax-Free Childcare Scheme
The Tax-Free Childcare Scheme is a government initiative that will eventually replace the Childcare Voucher Scheme and you need to work out if it would be a viable option for your personal situation.
- The way it works is for every 80 pence you pay for your childcare, the government will make a 20 pence contribution. There is a maximum contribution of £2,000 per year per child – £500 every three months.
- In order to qualify for the Tax-Free Childcare Scheme, you child must be being cared for by a registered provider.
- The Tax-Free Childcare Scheme is available for children up to the age of 11 years and the children must ordinarily live with you.
- Both parents in the household must be working in order to qualify for the Tax-Free Childcare Scheme. Your spouse must not be earning more than £100,000 per year but your combined income can exceed £100,000.
- For yourself, in your part time job, you must be working more than 16 hours per week to qualify for the Tax-Free Childcare Scheme. You must also be earning more than £100 per week or more than £120 per week if you are over the age of 25. This is the Minimum Wage or the Living Wage.
- You can join the Tax-Free Childcare Scheme by setting up a special online account that you can pay into. The government then make contributions to top it up. As well as yourself and the government, other family members and your employer can also make contributions.
- If you think the Tax-Free Childcare Scheme might be a viable option for you, your childcare provider must also be signed up to the scheme so make sure you check with them first before you go ahead.
For working parents, it can be difficult to work out which is the best childcare option for them. For example, if you opt for the Tax-Free Childcare Scheme, you would no longer be able to claim Universal Credit, Working Tax Credit or Childcare Vouchers. The government have created this childcare cost calculator so that you can work out the best financial route for you and your family.
Free Childcare – 30 Free Hours
Parent working part time? Looking for free childcare? That would be just great, wouldn’t it?
Well, at the moment, children of three and four years of age – and some two year olds – are entitled to up to 30 hours of free education per week. As with the Tax-Free Childcare Scheme, there are certain criteria that must be met before you can make use of this 30 free hours. Depending on your hours of work in your part time job, it may or may not be a good option for you. Let’s take a look at the criteria and some of the pros and cons you might want to consider before choosing this route.
- The 30 free hours of childcare must be done over at least three days a week and for at least 38 weeks in the year. Across a full year, you are entitled to 22 free hours of childcare per week.
- As with the Tax-Free Childcare Scheme, in order to qualify for the 30 hours Free Childcare, parents must be working at least 16 hours per week and not earning more than £100,000 per year.
- In order to qualify for the funding, you child must be cared for by an approved childcare provider such as a nursery or registered childminder.
- You can get your 30 hours free childcare as well as claiming Universal Credit, Tax Credits or Childcare Vouchers.
- One problem you might come up against in your area is the 30 Free Hours of childcare may be difficult to access. Some nurseries have voiced concern about the scheme and may choose not to offer the free hours. This is because they say the amount of money the government will reimburse nurseries with is not enough to cover the cost of quality childcare. If you do want your child to go to nursery whilst you are returning to work, check with your local ones to see if they are taking part in the scheme.
- With the 30 Free Hours childcare, bear in mind that this financial help stops when your child reaches compulsory school age or starts reception class.
Working Tax Credits
With Working Tax Credits, you need to renew your application each year and you are sent a reminder for this. If you are a working parent or you are about to go back to work, you can sometimes get help with childcare costs. You will be unable to claim Universal Credit (see below) if you are receiving Working Tax Credits.
Universal Credit is a payment that is made to help you with your living costs if you are on a low income. Low wages are a common problem for many mums who return to work part time so you might be entitled to Universal Credit. It depends on your personal circumstance and the area of the country you live in.
With Universal Credit, there is no limit to how many hours you or your partner can work and you could be eligible to claim back up to 85% of your childcare costs using this route. The payment is a monthly payments – sometimes twice-monthly in Scotland.
For many working parents, the financial cost of a nanny doesn’t make it a viable option. However, if you are working part time and you have friends nearby who are also working part time, you could work it out between you and opt for a nanny share.
Another way that having a nanny can prove cost effective is if you have more than one child. You won’t need to pay the full cost for each child. In some case, you will pay the same hourly fee or, in others, you might pay a little bit extra for each extra child. You can discuss this with the nanny you employ.
If you employ a nanny, you will need to pay their National Insurance (and pension in some cases) so bear this in mind when you are costing this type of care for your children.
There are various ways to keep the costs down if you have leave your child with a childminder whilst you work part time.
- Registered childminders mean you can use some of the financial schemes mentioned above.
- As with a nanny, if you have more than one child with the childminder, you might not have to pay double the rate. Rather, you can pay a bit extra for each child. Again, you can discuss this with the childminder.
- Once your child is in school, you will pay less money to the childminder because your child won’t be in their care for the whole day.
- If your childminder’s fee includes drinks, snacks and meals, you could send your child to the childminder with their own refreshments and snacks so that you can control the costs – and also have more control over what your child is eating.
If your children are older, then taking the option of an au pair could be worth thinking about. Your home will need to be big enough to accommodate an au pair as part of the deal is that you offer them lodgings. They will also be like a part of your family and you will need to factor in their meals.
As well as food and accommodation, the cost of your au pair will be £75 per week ‘pocket money.’ This gives you help for 25 hours per week which could be ideal if you are going out to work part time. You can also ask your au pair to babysit for two evenings per week.
An au pair is not a registered childminder or a nanny so you may not be entitled to some of the tax breaks and other financial assistance mentioned above. However, you are only paying them ‘pocket money’ so you don’t need to pay any National Insurance cost as you would with a nanny.
School Holidays – Clubs and Schemes
During the school holidays, a little bit of research and keeping your ear to the ground about local activities that might be taking place could save you money whilst you are in your part time job.
- Does your local authority offer any holiday activities for children of the age you have? Community centres and youth groups in your local area might also offer activities. Keep yourself up to date with who is offering what in your area. This can be done by keeping in touch with your local authority and also by joining relevant groups and pages on social media. Speak with other mums about what they are doing about childcare during the school holidays.
- There are also private companies that run activity centres during the school holidays all over the United Kingdom. These centres are run by qualified staff and are inspected by Ofsted. If you have one of these centres in your area, you could still claim financial assistance for your child to take part. Check with the particular company to see if they accept Childcare Vouchers or are involved in other schemes that could help you financially.
Returning to work part time after you have started a family is not an easy decision to make but if you have made that decision and you are ready to go, take a look at some current part time vacancies in your area. And, if it’s sometime since you’ve been an interview situation, get yourself prepared with these top tips for nailing your interview.