Help so confused financially!!

[merlinblue]

Hi

I have just qualified as a childminder and have someone interested for full time. The problem is I don't think I will be any better financially. I work 6 hours a week at the moment and after child tax credit, my job and child benefit I get about £633 per month. If I start childminding and work 41 hours a week my tax credits go down and I will only pick up about £900 this seems alot but then I will have to pay Tax and NI which I don't pay at the moment as I don't earn enough!!

I feel really trapped as want to earn more money but am not sure how. If I return to work I will have to pay for childcare!! Just feel like I am banging my head again a brick wall.

Are any of you in the same situation?

[Tatjana]

Didn't want to read and run but I have nothing to suggest or advise, sorry.

We get the minimum of tax credits anyway so it doesn't affect me whatever amount I earn.

xx

[tulip0803]

Childminding is a high expence profession. The income you actually get (give to tax credits/get taxed/pay NI on) is not what you receive in fees it is after all expences and 10% wear & tear is taken off.

All food, toys, equipment, mileage, PL insurance, course fees, stationery and any other business expence you pay for comes off first and a % of rent, gas, elec, oil, water & council tax depending on hours you work. It is quite possible for a childminder to make a loss in the first year. The more hours you work the more expences you will have.

Some childminders have expences of around 2/3s their fees so if they were earning £9000 in fees after expences their actual income is £3000 IYSWIM. Expences vary from minder to minder depending on what equipment etc you need to buy.

Only you can work out if it is financially viable for you. Maybe you would be better off just doing part-time.

[Pipsqueak]

Hello and welcome Merlin (what a lovely screenname:thumbsup: ). I am not sure how many you are registered for but don't forget that you will be able to take on other mindees, including over 8's. Much of your money can be made up in the holiday periods if/when you have the children longer.
Make sure that your rates are in line with the local areas.

[ZoeAlli]

Hello and welcome Merlin!:)
I would agree with tulip and pip! When you look at your earnings don't forget to take into account all your expenses (mentioned by tulip!), you might surprise yourself as to how much you can earn in a week!! :)

[Zoomie]

Hiya merlineblue

Welcome

Just wanted to add that tax credits take into account your 'after expenses' income, so for the example above given that £9K earned, but 2/3 expenses, tax credits would be based on the £3K.

HTHs

[Minstrel]

Hiya merlineblue

Welcome

Just wanted to add that tax credits take into account your 'after expenses' income, so for the example above given that £9K earned, but 2/3 expenses, tax credits would be based on the £3K.

HTHs

And like wise you would only pay NI and not tax as its below the threshold.

[carlen222]

yeah my local job centre told me about the 2/3rds of income so only 1/3 is counted as your actual figure of income so tax credits, etc are based on that small amount so youd probably be better off than you think!!! xx

[zillervalley]

I agree to all above and dont get it wrong I took 1/3 off instead of the the other way round, (silly Me)

ziller

[youarewhatyoueat]

don't forget for every £1 you earn you only lose 39p in the pound with tax credits so you still get 61p in the pound or something like that , in any case as the others have said you will find you should be better off.

[shelly03]

Hi at the end of the day working is about self worth. If i didnt work i would feel pretty low about myself and the bonus about childminding is that you dont have to pay for childminders, as you are caring for your own child. Paying tax is a bonus as it contributes to your pension. Its a win win situation. I think you are doing the right thing.

[Sue2000]

don't give up. even if you are confused financially, it's because it's just a start. Childminders do make a loss in their first or even their second year. Then you can get most of the children through recomendation and also school children come for extra hours while on holidays. As someone said while your own children are young, it's good way to spend some time with your own children and also work. It's such a fulfilling job.