Maternity Entitlements

[clipclop1]

Hi everyone,
My partner and I are considering starting a family soon but want to make sure that we know where we stand with regards to finance before we do anything!

We both earn £19,000 a year and are not married. I've had a look at what maternity pay we can get (90% of my wage for first 6 weeks than down to £138 a week) but when I looked at Child Tax Benefit the online calculator it said that we're not eligable for it at all and I'm guessing this is because of what we earn.

Now I may sound extremely clueless here but surely there must be more help out there for first time families?! To take a £800+ drop in my monthly earnings is horrendous enough and I find it hard to believe that people do actually manage on this?! I saw that you can get £500 Surestart grant for your first child or twins and while that's a nice little sum of money, it doesn't do anything for our mortgage payments and paying the other bills... If this is really the case then I can't see us going into this.

If any of your expereinces mums and dads would like to offer me any advice I'd be very grateful!

[phleb]

First of all, they don't give the grant to people that work, in fact they barely give anything to us working class people. You need to be on income support to get grant. I get £138 per week, been off since December. You get child benefit and tax credits aswell.It is worth it though, children are a blessing if you want them. x

[clipclop1]

Thanks Phleb, Yes the info about the grant was a bit confusing!!
Does the Child benefit and child tax credit alter depending on earnings and circumstance or are they the same for everyone? IF so, what are they?! haha!

[black_cat51]

yes in my experience, a wage of nearly 40k between you will not entitle you to the means tested benefits. You will get child benefit though - your wages will be low enough for that. It's about £90 per 4 weeks. i suppose what you'd have to do is go back to work, perhaps evenings or nights if your kind of work would allow that, so that you don't need childcare. You have to, by law, have 2 weeks off after a birth, but you can go back directly after that. Child minders are cheaper than nurseries. Some parents get the grandparents to be unpaid childmingers if their circumstances allow, which is even cheaper of course. in my experience, you just manage
Be aware you are asking for comments from the "we didn't get CB or even maternity pay in the good old days, why should i pay for you to have a family" brigade!!

[black_cat51]

also meant to say, some employers allow you to average out your Mat pay, and that way although you get less for the first six weeks, you get a bit more in the last bit

[clipclop1]

Ah thank you for all of that! Very helpful! I've been doing some googling and the situation doesn't seem so bleak as I originally thought. We're just trying to be sensible and not rush into anything before we know how we'd cope and be able to do things properly (or as properly as possible at least!)

Haha yeah I was aware of that and thought I might get some dodgy comments (especially as I've had some horrendous comments to past questions!) but all I'm asking for is some advice, not peoples personal disgruntled opinions and I hope I've not put anyone's noses out of joint at all by asking an innocent question! :)

Thanks again!

[factor-fiction]

In addition, your income tax bill will go down as your earnings fall- in fact you may have no tax to pay at all and may get some of what you've paid refunded. You may also save on things like travel to work costs and your expenditure on things like night out and holidays will fall so you'll cope. We were in a similar position 20 odd years ago and found we adapted fairly comfortably to a big drop in earnings. It may be worth building up some savings of a few thousand pounds before you start your family.
Good luck

[black_cat51]

that's a point - even if you get 2nd hand, there is a bigish initial outlay (cot, pram, clothes and so on) so some savings are a good idea

[anneasquith]

nice to see you clipclop. and how very sensible of you both to get as much information as you can before taking the big step,,,my opinion, don't worry , you will manage , :)

[themas]

Tax Credits are complicated. They are means tested but not in the same way as any other benefit. After the child is born & you have got Child Benefit submit a claim for Tax Credits. This will initially be based on the joint gross incomes of you & your partner for the previous tax year (eg if you claim in the 14-15 year, it would be income for 13-14). That would very likely be for a period when you were both working so the total income (say £38K) might mean you didn't have any entitlement, or else a very small one.

However, during the current tax year (14-15) you would not be working for a large part of it (assuming you don't return to work until the maternity pay period ends) so your income (including the maternity pay) will be much lower. Once you have got your initial award notice & you have a fair idea of what you & your partner estimate your gross income will be for 14-15 you can contact the Tax Credit Office & ask them to calculate your entitlement based on those estimates. You should then have some entitlement for the 14-15 year.

When you return to work (assuming you do so) then if you have paid for child care from a registered childminder a % of the cost (I think it either 70 or 80% up to a maximum amount per week) can be claimed as part of the Tax Credit.

[black_cat51]

also meant to say that if your employer subscribes, you can get child care vouchers

[clipclop1]

Oh thanks you for all the answers everyone, very informative and interesting!!

Nice to see you anneasquith! Hope you are well!

Do you know if the means tested credits are based on both of us even though we're not married? Or because we'd both be caring for the baba would it automatically be both of us? :)

[factor-fiction]

There is no discrimination in favour of unmarried couples - means tested benefits are based on household income whether couples in a household are married or not. So it depends whether the prospective dad lives with you (and if not it may depend on whether he supports you financially)

[clipclop1]

oh dear... that changes things then... :(

[pixie373]

You might also be able to add your annual leave onto your maternity leave, which gives you a few extra weeks of full pay (you accrue annual leave, even if on maternity leave), so that could cover two years worth of AL.

[clipclop1]

Oh thats a good point.

I'm sorry if I sound totally clueless and I'm definitely not expecting the 'state' to ensure that I live in the lap of luxury... I just find it unbelievable that people have to take such a massive drop in pay!
I thought we'd be ok with CTB as I thought it would only be based on me as we're not married.... its thrown a spanner in my works!

How did you all do it and not rip your hair out stressing about making ends meet, buying food and paying bills!????

[factor-fiction]

We saved up some money until we were sure we could get by when the income was lost during mrsfactor's maternity leave

[pixie373]

We struggled. I did some work from home, but we got there.

[black_cat51]

we took a drop in living standards (ie went down to 1 car from 2, cut out non-essentials. I went back to work sooner than i'd have liked to

[sherrardk]

I took a very short maternity leave on the first three (and it broke my heart) although childcare costs for the first two were astronomical - £1k a month for a day nursery (and that was 11 years ago).

[clipclop1]

It makes me soo sad to hear all of you say that ( or read as the case may be ). I know money isn't the 'be-all & end-all' but we'd be looking at a situation of only having £20 a month to spend on the baby... that's if it didn't get eaten up with unexpected expenses which we all know can creep up!