Family Debts: Childcare Too Expensive



little girl depositing change in her piggy bank

little girl depositing change in her piggy bank

Childcare costs have become so expensive that many families are giving up two incomes and returning to one in order to take care of children. Some parents are giving up their jobs and staying at home, according to a survey from insurance provider Aviva.

Reasons

The report details that an increase in costs and a decrease in savings means that family budgets are poor. Parents with part-time jobs are debating whether or not it is worth it to work at all. The study of 6,000 families showed that 32,000 women left their jobs after it became too expensive to work, with the “associated costs of working”.

The report was called the Family Finance Report, and it showed budgets precariously balanced, with fuel, lighting, heating, and food costs all increasing as incomes fall. Childcare is included in “work expenses”, such as transportation.

According to the report, full time childcare costs £385 per month on average. “The average woman with two children (one year and seven years old) would be out of pocked by £98 per month if she worked part time, and better off by just £120 per month if she worked full time.”

Additional costs for children include school trips, sporting and after school activities, and other costs, such as clothing, which is replaced frequently. Family incomes have fallen 2% this summer, which could be due to a decline in these part-time parents.

Attempts at a Fix

Debts such as credit cards are an average of 10% of the family budget. The Department for Education has said that they are going to help families stay in work by providing extra free child care for two year olds on low family incomes in addition to extending it for three and four year olds. Additionally, the Working Tax Credit is already quite generous and the government is preparing to bring in the Universal Credit, helping people off benefits.

This will have people helped by their companies. The aim by the government is to get 350,000 children out of poverty. Additionally, the programme, Sure Start will be aimed at the most underprivileged families in order to provide maximum support for them.

 

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