Article 6 ways to manage your childcare costs

Every parent knows that childcare can eat into their family’s income – especially if they’re thinking about returning to work.

In the UK, the cost of childcare has increased. The average cost of sending a child under-two to nursery part-time is over £7,500 – a 7.4% increase on the previous year.¹ As a result, it can be stressful for families to budget for.

The good news is that we’ve compiled some helpful tips to help you better manage these outgoings. We’ve also added a list of resources if you would like to find out extra information on each tip. 

1. Tax-free childcare
2. Free childcare hours
3. Plan ahead
4. Community is key
5. Team up with friends
6. Share a childminder

Make use of tax-free childcare

Did you know that you could receive up to £2,000 annually, for each of your children, from the government to offset childcare costs? If you’re eligible, the government will pay 25% of what you pay towards an approved childcare provider, including: childminders, nurseries, nannies, after-school clubs and play schemes.²

Check out Gov.uk’s childcare calculator on its website to find out what help you could get towards costs, and apply online.

Claim free childcare hours

In England, you can apply for 15 hours of free childcare per week (for 38 weeks, during term-time) if you’re working, and your child is between nine months and two years old.³

If your child is aged between three and four, you may be entitled to 30 hours of free childcare, also for 38 weeks.³

It takes around 20 minutes to apply online on the Gov.uk website, and you must reconfirm your eligibility every three months. It’s worth noting that schemes in Scotland, Wales and Northern Ireland are different.³

Plan ahead

If you live with a partner, it’s worth making time to sit down and discuss your schedules. For example, if hybrid working is available to you, consider going to the office on a different day to them to spread out childcare.

If you live alone, or hybrid working is not an option, consider getting help from loved ones who can work flexibly, or from any retired friends and grandparents. If neither are an option to you, read on for more information.

Research local community resources

Community can be key when it comes to childcare. In the UK, the price of an after-school club is £69.14 a week.¹ These costs can quickly build up, so try researching some cheaper alternatives.

If you're unable to make the school pick-up, some locations might have children’s centres that host free activities for young kids. For example, Scouts and Girlguiding are often a cheaper alternative. Fees vary from area to area, but they try to make their membership affordable.

Some places in your community, like Churches or youth groups, may also have after-school clubs to take advantage of, too.

Team up with friends and relatives

If you have friends, relatives or neighbours with kids, consider taking it in turns to share childcare duties. You might be able to save some money and enjoy some time for yourself, while socialising and making new friends with parents in the process.

If you have parents or grandparents who are retired, or live nearby, you may be able to enlist their help, too.

Consider sharing a child minder

Now, the average cost of hiring a childminder in the UK until 6pm, across one week, is £75.87 – an increase of 4.9% annually.¹

If you're looking to hire a childminder, but are concerned about this cost, consider making an arrangement with another family and share a child minder which would then share the cost of one.

Where to find more information

While childcare costs are rising, it’s possible to cut down on these expenses and find a strategy that works for you, your children, and the rest of your family.

For more details and information on eligibility for tax-free childcare, visit Gov.uk’s website.

If you’re looking for more information on free childcare hours, you can visit the relevant government webpage, depending on where you live: 

• England
• Scotland
• Wales
• Northern Ireland

And, for more ideas on childcare options, visit the MoneyHelper website. MoneyHelper gives free and impartial guidance to help make your money choices clearer.