As any parent will testify, children cost a small fortune. Childcare, in particular, is one of the biggest areas of expenditure, with average costs for 25 hours per week at £88 in England - or £4,576 a year*. At the same time, the sheer amount of debt accrued by many parental couples means that one of them giving up work to care for the children is not a viable option.
The good news is, there are some simple ways for working parents to make savings without compromising the quality of care.
Check the Working Tax Credit
If you are eligible for the working tax credit, you can also get support towards the cost of childcare. In theory, some parents can claim up to 80 per cent of the cost - up to £175 per week for one child** - but in reality only a few do, and the average claimed currently stands at £68.69*.
The rules of eligibility are incredibly complicated, but generally speaking, you need to be working more than 16 hours a week (couples both have to work for at least this long), and have a household income of less than £40,000 a year. To apply, call the Tax Credit Helpline on 0845 3003900.
Make the most of childcare vouchers
Childcare vouchers, provided by many employers, can be used as full or part-time payment for childminders, nurseries, nannies, au-pairs and out-of-school clubs. The voucher scheme enables working parents to get up to £243 a month paid direct from their pre-tax salary to a registered care provider, and both parents can claim. Carers must be registered with Ofsted to qualify.
Choose a child-minder
Child-minders are typically the cheapest option for parents, costing between £135 and £400 per week*. Nannies are traditionally more expensive, at between £400 and £600 for a 50-hour week, depending on where you live. Child-minders may also be cheaper per hour than a nursery, and can also be more flexible.
Cut out the nanny agency
If you're set on one-to-one care, there are hundreds of nanny agencies available, but note that you will have to pay a finders fee. A cheaper option is to go to one of the sites where nannies post their details, such as netmums. Also check out noticeboards in your local shops, church hall and doctor's surgery.
Consider nanny-sharing
More and more parents are now finding they can afford nanny fees if they share their carer with another family - or two.You can find a share through general nanny websites, local noticeboards or specialist sites such as nannyshare, which offer a service matching local families who want to split the cost.
In an emergency
One of the biggest nightmares for working parents is a nanny calling in sick - but help is on hand at sites such as emergencychildcare, which offer a last-minute service enabling you to search for and book a nursery place, child-minder or emergency nanny with only 30 minutes notice.
Shop around for nursery care
If you're happy to opt for group care through a nursery, the cost varies dramatically, so you'll need to do the legwork to check out your local options. Once you've found a nursery you like, ask about potential further savings, such as care during term-time only.
Cash in on early-learning classes
All three and four-year-olds are entitled to 12.5 hours a week in 'early-learning' classes for up to 38 weeks a year. There are various different forms of free early learning sessions available - such as attendance at playschools and nurseries - a win-win situation for working parents, as your child gets extra education and you get free childcare.
Get grandparents to help out
If all of these options are simply too expensive, consider mixing and matching, and adding in a day or two with other family members, friends or neighbours. While neither the childcare tax credit scheme nor the voucher scheme can be used to claim for the cost - unless the carer is a registered child-minder or nanny - this can be a great way of cutting costs, while also building relationships.
Check out local holiday clubs
Check out free or discounted summer courses (e.g. sports training weeks, music or dancing coaching, general activity clubs) that are run by schools, leisure centres and churches. Also, remember that both childcare tax credits and childcare vouchers can be used to pay for holiday clubs and summer courses - provided the scheme is officially registered.
Follow the link for more money-saving tips for parents.
* The Daycare Trust
** HMRC
