How to find the best childcare without breaking the bank
It's ironic that for mums returning to work after maternity leave, work is arguably the last thing on their minds.
Far more pressing than a demanding boss is the need to find someone you can trust not only to look after your child, but to do so at a price that doesn't make your return to work financially pointless.
Childcare has become an exorbitant expense – after the mortgage it's the family's biggest monthly outgoing. The average cost of childcare for a three-day week in London is £5,668 a year, compared with £3,900 a year in the North East.
Some parents in London can even pay up to a phenomenal £11,050 a year for just three days' childcare a week, according to the Day Care Trust.
However, if you are aware of your options and the potential savings you can take advantage of, you can get your career back on track without spending every penny you earn on childcare.
Nannies & childminders
Most parents would love to swan off to work leaving Nanny Macphee in charge of the kids. But most of us can't afford a nanny: they can cost up to £500 a week (£400 with board and lodging).
This figure is the nanny's net pay – you also have to pay income tax and national insurance on top, and register as an employer with HM Revenue & Customs (HMRC).
However, you can avoid the paperwork by using a payroll service such as PAYE for Nannies (payefornannies.co.uk) or Taxing Nannies (taxingnannies.co.uk).
It is possible to reduce the cost by sharing a nanny with another family. A quick web search will show up sites like nannyshare.co.uk that work a bit like online dating agencies.
Parents can key in their postcodes and see if there is another family living nearby who would also like to share a nanny.
Childminders are certainly a cheaper option, in some cases costing less than £5 an hour, because they work out of their own home and take care of more kids.
But that's not to say they offer inferior care – like schools and nurseries, childminders are regularly inspected by the regulator, Ofsted.
Each childminder can look after three under-fives, of which only one can be under 12 months. And, as they're self-employed, you don't have the same degree of bureaucracy and paperwork to battle with.
Contact your local council or Sure Start centre: they should have lists of childminders available in your area. You could also do an online check using the Department for Education's Family Information Directory (informationforfamilies.dcsf.gov.uk).
When you're interviewing childminders, ask for their unique reference number; you can then go onto the Ofsted website to see how they fared in their latest inspection.
There are also nurseries, of course, but these too are expensive, especially for the under-twos, with prices upwards of £50 a day.
Competition for places can be fierce, so if you've set your sights on one that's next door to the station or on your way to work, you may need to secure your booking before you even have your baby.
While many parents like the facilities offered by nurseries, and prefer dealing with a business rather than an individual, the downside is that they are nowhere near as flexible – miss your train home and you could get stung with penalty fees – and the turnover of staff can be high.
The good news, however, is that costs do fall as your child gets older. All three and four-year-olds are now entitled to 15 hours a week at a nursery during term time until they reach school age, taking a large chunk out of most families' childcare bills.
Once your bundle of joy is old enough for school, expenses certainly fall – but they don't disappear altogether. Unless you have a very flexible employer, you still need to contend with after-school care and holiday clubs.
Childminders and au pairs are an option, but decent childcare is also provided by schools themselves – ask your school about breakfast and after-school clubs, which combine childcare with other activities like sports classes and study support.
Whichever stage your child is at, you can get help with costs of childcare – but you have to get your elbows out. Setting up a network of friends, relatives or colleagues with children is absolutely free – parents just take turns at babysitting for each other.
Fears that parents would have to register themselves with the Independent Safeguarding Authority for such informal arrangements seem to have died down. The coalition government has said it wants common sense to prevail.
You should also badger your employer until it agrees to set up a salary sacrifice childcare voucher scheme. Just appeal to its desire to turn a profit by pointing out it will save up to £373 a year in NI contributions for every employee who joins the scheme.
The schemes are easy to set up too: a few internet clicks will throw up plenty of voucher scheme companies ready and willing to do the donkey work.
'Salary sacrifice' might not sound a very appealing idea, but it can save each parent up to £1,195 a year. Put simply, it enables parents to 'sacrifice' or set aside up to £243 a month of their salary (before tax and NI are deducted) towards childcare.
The money is then paid in vouchers to approved childcare providers. Be warned, however, that vouchers will affect your tax credits.
It's also worth noting that while the 40% tax break for higher-rate taxpayers will be scrapped in April, it will only affect people that join schemes after 5 April. So, if you pay a higher rate of tax, sign up now.
Child tax credits are also worth applying for, despite horror stories of parents being forced to repay them. Parents earning less than £58,000 or (£66,000 gross a year if the baby is under one) are eligible. However, the government plans to restrict this benefit in 2012.
Dealing with the back-to-work blues
Lisa Buckingham, editor of Financial Mail on Sunday and mother of Natasha, 19, and Camille, 17, reflects that not even top executives can escape those dreaded back-to-work blues.
"Untroubled and stately as a galleon, I'd cycled to work until practically the day my eldest was due. This motherhood stuff all seemed pretty easy: have baby, bond for a while, then go back to work. How wrong I was.
"Before I left for maternity leave, I'd assured my employer that I would be up for a return to full-time work. However, like so many other first-time mums, as soon as I gazed into the eyes of my newborn, I knew returning even part-time would be three days a week too much.
"I didn't anticipate too much of a problem with this change of heart, not least because, back then, I was working for the uber-liberal Guardian newspaper, which devoted forests-worth of newsprint to helping mothers back into work. Sadly, the editor was somewhat off-message. Part-time women did not work, he declared.
"Negotiations to return involved several months of unpaid leave – the consequences of which have taken their miserable toll on my pension pot. But this was nothing compared with the feelings of inadequacy as a returner: useless worker, useless mother.
"In the end, I benefited from a friend volunteering to look after my first child for a while, and shortly after, my mum and mother-in-law became our paid-for help."
A tax-efficient way of receiving staff benefits, where an employee agrees to forego a proportion of their salary for an equivalent contribution into their pension scheme or in exchange for company car, gym membership, childcare vouchers or private medical insurance. A salary sacrifice scheme is a matter of employment law, not tax law, and is often entered by an employee who is about to move into the higher 40% tax bracket.
A scheme originally established in 1944 to provide protection against sickness and unemployment as well as helping fund the National Health Service (NHS) and state benefits. NI contributions are compulsory and based on a person’s earnings above a certain threshold. There are several classes of NI, but which one an individual pays depends on whether they are employed, self-employed, unemployed or an employer. Payment of Class 1 contributions by employees gives them entitlement to the basic state pension, the additional state pension, jobseeker’s allowance, employment and support allowance, maternity allowance and bereavement benefits. From April 2016, to qualify for the full state pension, individuals will need 35 years’ of NI contributions.