The Motherhood Penalty is a term which refers to the systemic disadvantages faced by mothers in the workplace including pay, benefits, and career advancements.

Approximately 250,000 working women with children under four years old leave their jobs due to the struggle juggle between work and childcare according to the Fawcett Society.

As a mother who has just started my second maternity leave in less than two years, I feel this is a particularly close subject to my heart.

Upon reflection of the ‘motherhood penalty’ on my personal life, I do believe that both of my pregnancies and maternity leave have negatively affected my career advancements in terms of promotions, decent raises, and even bonuses. Maybe a coincidence, maybe not!  

However, below are a few tips which I am implementing to do my very best to not let these young mothering years have a long-lasting impact on my career. 

Remember your value 

It is extremely easy to fall into the trap of believing you’re less efficient or useful than colleagues who are peddling ahead in their careers without breaks due to motherhood. However, we really do all have different strengths, and we (mothers) are not less than because we took some time out to raise the next generation.  

In fact, after my first maternity leave, I found that I had a new appreciation for work, improved efficiency, and a refreshed approach with a fresh lens. 

Instead of focussing too hard on perceived shortcomings, remember you have the job you do for a reason, and there are things you bring to the table that perhaps someone else could not. Self-doubt can prohibit your ability to advocate for yourself for career opportunities and advancements, so you must keep the value you add at the forefront of your mind! 

Shrink the pension gap! 

In the UK, the pension gap between men and women remains quite large to this day. The 2024 gender pension gap report found that on average women retire with a pension pot of £69,000 compared to £205,000 for men. The report goes on to conclude that career gaps due to the likes of childcare lead to an average ten-year career gap resulting in a £39,000 loss in pension savings. 

The amazing thing about pensions during maternity leave is despite your reduced pay and therefore reduction in pension contributions, your employer still has to contribute the same amount to your pension whilst you’re on maternity pay.  

Depending on the type of pension scheme you are enrolled in, such as salary sacrifice, your employer may still have to make pension contributions even in periods of no maternity pay.

Therefore, it is best to check with your employer how your pension contributions will be treated during your maternity leave. At the very least, do your best to not reduce your personal pension contributions during maternity leave so your pension can still continue to grow at a decent rate. 

Keeping-In-Touch (KIT) 

I think a really useful tool for mothers on maternity leave is to make use of the up to 10 keeping-in-touch (KIT) days available to us. These days allow you to reconnect with work and get paid in full on top of your maternity pay without stopping your maternity leave.  

It will be up to you and your employer to decide the use of your KIT days. One way I maximised this time was by completing a 3-day intensive training that added a great boost to my CV and provided me with additional skills I could put into practice upon my return to work.

I loved the feeling of being able to achieve something for my career whilst on maternity leave, which in turn also benefitted my employer. 

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I used to be a Junior ISA sceptic. Yeah you heard me.

My thinking was this: I don’t fill my annual allowance in my own ISA, so surely I should focus on trying to do something about that first?

Plus, JISAs are cool and all but there’s an element of trusting your child to turn out not to be a reprobate aged 18 and blow the cash you’ve so diligently saved for them.

This feels like a bit of a taboo thing to say, surely our lovely offspring are all little angels etc?

I have however, had a change of heart, dear reader.

It takes a village to raise a child

One of the drawbacks of the JISA is it is beholden on a responsible parent to get one set up. This is something I know for a fact firms such as Scottish Friendly have campaigned tirelessly on to rectify.

More than one in three (36%) of Brits would set up a JISA for a grandchild, niece or nephew if they were allowed to, according to the firm’s own research.

But there are growing tech solutions that help to mitigate some of this. My podcasting co-host Chris Tuite and I were joined by Cem Eyi, co-founder of a JISA app called Beanstalk, on the podcast this week to talk about how his firm is trying to square this issue.

And I have to say, I’m not often persuaded by gadgety fintech solutions, but I think this one might have actually pushed me over the line into becoming a JISA fan.

Beanstalk sets up really easy ways for family and friends to contribute to a JISA. So the responsibility to set up and maintain the account is still a parent, but now we can ask family and friends to put a tenner in his account for his birthday or Christmas.

This has the potential to give a significant boost to his JISA fund beyond what we’re able to contribute on a regular basis.

And importantly it takes some of the jeopardy of sharing cash around out of it. Grandparents can contribute directly and regularly, as can other family or friends. There’s no fuss with having to hand money through a parent.

It really does take a village to raise a child, and this seems like an excellent modern expression of this.

My son is now over one year old, so really I’m starting late for him. I’ve gone all in 100% invested for his allocation in the app. After all, 17 years is a long time to grow him a nice little nest egg.

So happy Christmas Cosmo, here’s hoping I can start you today on a journey to financial freedom in adulthood. My only regret now is I didn’t start it for you sooner.

This article contains affiliate links. Affiliates help fund our journalism but in no way have a bearing on editorial discretion.

Photo credits: Pexels

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Q Is it worth taking a term time family holiday with our children as I can’t afford it during the holidays? 

A As a money expert and a mother, I fully understand the financial pressures many families face when planning holidays.  

While prices of travel and accommodation are often significantly lower during term times, it’s important to weigh the potential educational impact and any fines or penalties that might be imposed by the school. 

If you take a term time family holiday without the school’s permission, you can be fined. The fine is typically £80 per parent per child, which increases to £160 if not paid within 21 days. 

What’s more, persistent unauthorised absences can lead to more severe consequences, including prosecution. If found guilty, you could face a fine of up to £2,500, a community order, or even a jail sentence of up to three months. 

Beyond legal implications, consider the potential impact on your child’s education. Missing school for a family holiday can affect their learning and progress, which might have long-term consequences. 

Luckily, there are few additional ways for families to travel without breaking the bank, even when schools have broken up. 

Ask our experts your money questions

One way is to use AI to help you find the most affordable trip for your money. 

AI, or Artificial Intelligence, helps computers perform tasks that usually require human intelligence – and using it to plan your vacation is easier than you’d think. 

If you think of AI as a smart assistant – or your own travel agent – you can enter prompts that mean it can analyse historical price data to predict future prices, giving you a heads up on the best deals.

It can also suggest cheaper travel destinations that you might not have considered by considering your local airport, preferences – such as climate, activities, culture and, most importantly, your budget.  

Here is an example of a prompt to type into Chat GPT or whichever AI you prefer. You can tailor the details to meet your preferences:  

“You are my travel agent. Give me five ideas for an August holiday destination. I would like these locations to have temperatures of between 25 and 30 degrees Celsius during August.

“I will be traveling in a group with two children and two adults.  We enjoy things like swimming, beaches, and theme parks. All in, we would like to spend less than £1,500 amount for seven days. Ask me five questions that would help you do a better job of helping me pick a place.” 

Then it should help you by suggesting holidays that suit your requirements.  

Another way to help make travelling more affordably is to bulk up your holiday budget and sign up for a cashback website such as Quidco.com to save money all year round. 

Here, product providers and retailers pay commission when shoppers click on their links. In turn, the cashback website rebates some of this commission to you.  

I recently paid for a weekend getaway in Paris with my daughter with my Quidco earnings and it made a massive impact on the cost of our trip. 

If you are unable to pay for your holiday in one go, a 0% purchase credit card could help you to spread the cost of your holiday interest-free over several months. 

However, you’ll need to make sure your credit limit stretches to your holiday requirements and avoid spending more than you can afford to pay back. Try to clear your balance before the 0% deal ends and interest kicks in. 

Keep in mind you’ll need a good credit score to qualify for the most competitive credit cards. 

When it comes to a term time family holiday, I know many parents feel like we are stuck between a rock and a hard place, but with thoughtful planning and the right resources, you may be able to have the best of both worlds. 

Kara Gammell is an award-winning financial journalist with nearly two decades of experience writing for national newspapers and magazines such as the Daily Telegraph, the Sunday Times, Good Housekeeping, the Metro, the Independent, the Guardian, the Observer, Marie Claire, the Sun, and Cosmopolitan. Kara is the founder of a money-saving blog Your Best Friend’s Guide to Cash, which promises to help you get more bang for your buck, no matter what your budget. Her first book, Your Best Friend’s Guide to Cash: Eight Things Every Woman Needs to Know About Money, was published by Harriman House in 2014. Her latest book, Bargain Hunter: Easy hacks and tips to save money every day will be published by Headline Publishing in January 2025.   

Photo credits: Pexels

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My son was born in October 2023, just old enough to take advantage of the new 15 hours free childcare provision in England.

But planning our childcare journey for him has been anything but simple.

We were super organised about childcare – but it actually didn’t help us at all.

The first thing to do was for my wife Ellyn to decide how she wanted to change her work hours – and see if her employer would be happy with this.

The good news was that they were.

Her arrangement went from five days a week, 37.5 hours, to 30 hours a week. However she would get every Wednesday off, plus every other Thursday. She was able to do this by stretching her days at each end so she’d only lose one day a week’s income. So far, so good.

She would lose four days of income a month effectively, but we were able to absorb it mostly, and the income benefit of her working (and us paying for childcare in the meantime) was marginal at best.

This meant we had to find three days of childcare a week one week, and four the next. Ellyn’s wonderful parents have stepped in to do two days a month, taking care of the Thursdays that she works.

OK. SO. Three days a week then of paid childcare.

As I said, we were being very organised about this, and made the plans in June LAST YEAR (2023), when she was just five months pregnant. Being aware of the difficulties of childcare provision, even ahead of these new schemes commencing, we decided to act quickly.

For context, this was three months after former Chancellor Jeremy Hunt announced the extension of free childcare hours to nine months of age in England, which was due to start September 2024.

 The timing of our son’s birth (and the point at which he’d qualify) couldn’t have been luckier to coincide with this.

We had decided, since both Ellyn and I had grown up in and out of the homes of childminders rather than nurseries, we were going to look down this route for our son.

We found a (notionally) great childminder, met her and looked around her home, and agreed to have her take on our son three days a week. Jobs a good ‘un so they say.

Not so fast.

Our error at this juncture was that we didn’t formalise this agreement, with a deposit or a contract.

Fast forward to March this year and the childminder gets back in touch with us to say, so sorry, she can no longer take our son on from September. It turns out that with the extension of the free childcare hours all of her existing clients had begun asking for more hours with her, in effect absorbing all her free capacity. Disaster.

At this point we were unceremoniously thrown into the helter skelter scramble for childcare places.

With choice no longer a luxury, we were forced to widen our searches to include nurseries. The first we approach – which was actually brand new and only just in the process of opening – was already oversubscribed with a waiting list. We found this time and again, most of the nurseries in our area simply had no places.

We were unaware at the time, but it turns out the area of England we live in has some of the worst per-head of child provision in the country. What a dubious honour.

Finally, we found a nice local nursery in our area with capacity to take him on. Ellyn had the good foresight to also ask them if they knew any childminders in the area with space (the ones we had found online had none). Unbelievably fortunately for us, they did in fact.

Long story short – we found enough to cover those three days a week – two with the new childminder and one at the nursery. But for a short while there it felt pretty close to disaster, and what we have now is a bit of a compromise.

The prospect of either of us having to cut back more days to juggle time with him would not have been good for our finances – indeed it would probably have been something of a nightmare.

More from Edmund Greaves on Mouthy Money

Allocating resources

The 15 hours of free childcare is, personally, a godsend for us. But no one explains that 15 hours doesn’t mean 15 hours.

When I first heard of it, to me it sounded like two days. After all, the typical office working hours are 7.5 per day. This is not how the free hours work.

15 hours is for TERM TIME only. If you want to stretch it to 51 weeks of the year, then its actually only 11 hours. For the purposes of the funding, our nursery counts 10 hours of childcare as one day.

The nursery then absorbs almost all the hours, with us getting one free hour a week from the childminder, in effect.

We’ve then set up the tax-free childcare account which pays the childminder. We put in something like £265 a month, and she gets £330 from the government. Also a great money saver for us.

In practice, this deal isn’t bad. But it has been a huge complicated and at times unnerving scramble to get right.

I can only imagine the struggles up and down the land to square this provision. The rules are barmy in many ways, particularly the one around timing mothers’ return to work and whether that entitles them to the free hours.

This is something Pregnant Then Screwed has rightly highlighted as being a particularly egregious unintended consequence of the system.

Anecdotally among our group of NCT parents we met when doing the baby training, two of the mothers are in this position where they have to cut short maternity leave just to ensure they don’t lose a whole term of free childcare hours. It is absolutely perverse.

But beyond that I return to our original issue – the childminder who ditched us.

Clearly this wasn’t done in any sort of deliberate way, she was simply provisioning her existing clients which was totally understandable.

However, this has happened because the last government hiked the amount of free provision to parents – WITHOUT FIGURING OUT HOW TO INCREASE THE SUPPLY at the same time.

We’re all aware of how difficult it is to start a family in this day and age. Birth rates are on the floor when really we need all the workers (*cough* taxpayers) we can get.

The sacrifices we make in careers, where we live, the toil of achieving home ownership and a myriad of other things conspire against us when we just want to start a family and experience the joy that brings to our lives.

Its bigger than just childcare though. Time and again we have these kinds of schemes put in front of us by government. Think of Help to Buy (and a myriad of other housing ladder schemes) as an example.

We’re constantly offered ways to ameliorate demand for something without thinking about how to increase the supply of it.

This rabbit hole extends wheezes in the NHS, the justice system, the energy market and all sorts of other areas of our lives that the government touches.

Unless we figure these problems out, it’ll never get better.

In a perfect world we’d have the money and the time not to need it, but the reality of modern life leaves us with little other option.

The good news is my son has started regular childcare, and bar some tears at the start, is loving the variety and new friends it brings.

Photo credits: Pexels

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Q What childcare help am I entitled to when my child starts school in September? Can I still claim free hours? 

A The Government’s ‘free hours’ childcare scheme ends at age five when children start school. This system allows most parents to claim free hours of childcare during the school term time.  

It’s currently undergoing a massive overhaul, allowing parents to claim these hours from nine months. The system is set to be fully rolled out by next year, and is available to working parents.  

But when children start primary school, there are still many costs to consider including before and after-school clubs. While there may not be free hours, what many parents don’t realise is that you can claim tax-free childcare until your child is 12 years old.  

The tax-free childcare scheme can save you thousands of pounds a year – as long as you or your partner don’t cross the £100k salary threshold, you are both in work and you aren’t accessing other benefits such as universal credit or tax credits.  

For every £8 you put into the scheme the government will top it up by £2; with a maximum claim of £500 every 3 months for each child. This increases to £1,000 every 3 months if your child is disabled.  

While this may not seem like much when compared to the annual costs of paying for childcare out of school hours, it is still a worthwhile benefit to signed up to. 

It can be used for after school clubs, holiday clubs, nannies, and breakfast clubs as long as they are Ofsted approved. You can sign up on the Gov.uk website and you need to reconfirm your details every three months. 

Ask our experts your money questions

Joeli  founded Pregnant Then Screwed in 2015 after her own experience of pregnancy discrimination. She is the winner of the Northern Power Women Agent for Change award, is an Amnesty International Human Rights Defender and a member of the United Nations Working Group: Women’s Human Rights in the Changing World of Work. In January 2021 she took the Government to court for indirect sex discrimination due to the way self employed mothers were being financially penalised by the income support scheme. Her debut book: ”Pregnant Then Screwed: The Truth about the Motherhood Penalty, and how to fix it’’ was published by Simon & Schuster on the 4th March 2021. 

Photo credits: Pexels

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Teaching children about debt is a tricky topic. In today’s financial climate, it is crucial that children understand money management from a young age. In the UK, many parents recognise this and are taking steps to educate their children about financial matters. 

Research indicates that financial habits form early in life, with many children developing their attitudes towards money by age seven. This early development highlights the importance of parental involvement in teaching financial literacy.

A Money and Pensions Service study found that 81% of children aged 7-17 learn about money management at home, demonstrating the pivotal role parents play in this aspect of their children’s education​. 

Understanding debt is an essential life skill. By teaching children about debt early, they can make informed financial decisions and be better prepared for managing their finances as adults. This blog provides useful tips to help you teach your kids about debt. 

More from Tolu Frimpong on Mouthy Money

Understanding the basics  

What is debt? 

It’s important for parents to explain to children that debt is money borrowed that must be paid back within a specified time period, and oftentimes with interest.

To make it easy for children to grasp, use simple examples, like borrowing money from a friend to buy a toy and repaying more than the borrowed amount due to interest. 

The different types of debt 

Introduce the concept of good debt versus bad debt. Good debt includes investments that provide long-term benefits, such as a mortgage for a home or a loan for education.

Bad debt, on the other hand, is money borrowed for non-essential items, like the latest gadgets or trendy clothes, which can lead to financial trouble. 

Understanding interest 

It’s important to help children understand how interest works by speaking to them in a language that they understand.

For example, explain that if you borrow £100 from your friend with a 10% interest rate to buy a new bike, you will need to repay £110. You could also use visual aids like charts to show how interest accumulates over time. 

Creating a budget 

When trying to educate children about debt, introduce them to budgeting, a fundamental money management tool that can potentially help them avoid the pitfall of debt in the future.

Explain that budgeting involves planning how to allocate money wisely to avoid overspending and falling into debt. Use simple examples, such as managing their pocket money or planning a budget for a small event, to illustrate the concept.  

Needs vs wants 

It’s also essential to help children understand the difference between needs and wants. Yes, they may need trainers for P.E. but do they need the latest Air Jordan 4’s?

Discuss the difference between essential needs and discretionary wants and help the children understand that borrowing should be reserved for necessary expenses, such as education or shelter, rather than impulsive purchases like the latest gadgets or fashion items.  

Modelling responsible financial behaviour 

Parents have the responsibility to model the behaviour they want their children to grow up and adopt. Therefore show your children how you manage your debts and make timely payments.

Discuss your financial decisions openly and explain the reasons behind them. Having this level of transparency with your children will help children understand the consequences of borrowing and the importance of maintaining a good credit history. 

Practical tips for teaching children about debt

Choose the right time 

Pick a time when your children are alert and attentive, such as after a meal or during a relaxed weekend afternoon, to discuss debt.

Avoid times when they are tired or hungry, as they are less likely to be receptive to new information during these times. 

Open lines of communication 

It’s important to create an environment where children feel comfortable asking questions about debt and personal finance, so please be patient with them and provide clear, honest explanations.

Encourage them to express their thoughts and concerns, and address any misconceptions they might have. 

Be honest about your experiences 

Finally, share your own experiences with debt, including any challenges you faced.Doing this will help children understand that everyone makes mistakes and learns from them, humanising the topic and making it more relatable.

Your openness can demystify financial struggles and teach valuable lessons about resilience and financial recovery. 

Photo credits: Pexels

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At one point, I found myself drowning in over £36,000 of debt. On my blog, tolufrimpong.com, I openly share my debt journey, discussing its impact on my marriage and friendships.

However, one topic I haven’t delved into deeply is the mum guilt that came with being in debt. 

Mum guilt hit me hard. I felt awful about not being able to buy my young child and newborn the latest gadgets and gizmos.

I couldn’t take them on holidays or afford the exciting experiences I saw other mums and influencers enjoying with their kids on Instagram. The guilt of failing financially and the fear of potentially making my children homeless was overwhelming. 

During our debt-free journey, my husband worked a lot of overtime, and I took on multiple side hustles. This meant we had less time to spend with our children, which only intensified my mum guilt.

Overcome mum guilt

Now, having achieved debt freedom and overcome that guilt, I want to share five things I wish I had known and done to reduce or eliminate the guilt. 

1. Enjoy the journey, not just the destination 

I was so laser-focused on achieving debt freedom that I lost sight of the present. There was no balance, and as a result, I missed out on precious family time. Those years of my children’s early childhood are now a blur. It’s crucial to enjoy the journey and make time for your family, even when you’re working towards financial goals. 

2. Remember your why 

You’re paying off this debt to ensure a brighter future for your children. That’s an amazing and responsible thing to do. Your children will be proud of you for taking accountability and making sacrifices to improve their future. Keep this in mind whenever guilt starts to creep in. 

3. Be intentional with your time 

If you’re working overtime or side-hustling to pay down debt, your time with your children is limited. Make sure the time you do spend with them is intentional and undistracted. Give them your undivided attention—this means putting your phone away and being fully present in the moment. 

Read more from Tolu Frimpong on Mouthy Money

4. Find frugal fun 

You don’t need to spend a lot of money to create great memories with your children. Find creative and frugal ways to have fun together. Bake, cook, build a fort, go on a hike—there are countless ways to enjoy quality time without breaking the bank. 

5. Speak to a trusted friend or family member 

A problem shared is a problem halved. We are often our own worst critics. Talking to someone you trust can help alleviate your guilt. They can offer perspective, support, and encouragement when you’re feeling down and beating yourself up. 

6. Create a vision board 

A vision board can help keep the bigger picture in mind on days when guilt creeps in about not being able to afford expensive trips and things. Visualise your long-term goals: being debt-free, thriving, and able to provide your children with the dream life you all deserve. This can provide motivation and remind you of the positive future you’re working towards. 

Photo credits: Pexels

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This week on the Mouthy Money podcast we were very pleased to have Sarah Marks, chief executive of RedSTART Educate returning to talk about the financial education charity’s first year of results in their multi-year study of the effects of financial education in schools.

During our chat Sarah raised an extraordinary idea – that financial education (and the current lack of it) could be the reason why we’re facing a major pensions crisis.

So what is this crisis we speak of? Our recent Money Matters Index data found that pensions savings are at woeful levels, leaving many facing longer years of work and less security in retirement.

But Sarah posited an intriguing reason as to why pension savings might be struggling so much – no one actually realises how much they’re going to get, and everyone thinks they’re going to get a guaranteed income.

Essentially – the era of final salary or defined benefit pensions is largely over. But the way in which we educate people about how pensions work has yet to catch up.

Fundamental changes – primarily from Government – need to be made to ensure that everyone, be they kids or adults, understands that today’s pensions are the sum of what you put into them now and for the foreseeable future.

What makes this all the more worrying is that we face an increase in the numbers of people taking their money out of pensions or giving up on valuable contributions in order to pay their bills today.

The whole situation, when couple with the slow death of the State Pension, is a deeply troubling set of events.

Have a listen to my chat with Sarah for more about this, plus the other findings from RedSTART’s research.

For the full episode: Spotify and Apple Podcast.

Photo credits: Pexels

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Parents looking to help their children learn the ins and outs of banking and money can use GoHenry, a debit card for kids.

Mouthy Money has an exclusive deal with GoHenry to offer one month free on the debit card for kids.

What is GoHenry?

GoHenry is company that offers pre-paid debit cards for children and teenagers.

For children and parents, the debit card has an accompanying app that lets kids learn about money with built-in “Money Missions”.

Parents will have access to a companion app that will help them oversee their child’s progress, set boundaries and goals for them to achieve, plus real-time spending notifications.

GoHenry also offers customisable debit cards for kids to use, making the process of spending with the app more fun and personal.

The deal in a nutshell

Mouthy Money’s GoHenry deal offers no monthly fee for the first month when you sign up a child to GoHenry’s debit card and app.

GoHenry has two tiers of membership after this:

• Everyday: £3.99 a month with features such as automatic allowance and tasks, spending notifications, parental controls.
• Plus: £5.99 a month which offers everything in Everyday but also adds 4.5% AER interest on savings, cashback on in-store spending and full access to the apps 80+ Money Missions

Note, GoHenry is a debit card only and does not benefit from Financial Services Compensation Scheme (FSCS) deposit protection.

Why does financial education matter?

Mouthy Money is a big proponent of financial education from the earliest stage of life possible. We’ve run a book competition with financial journalist and author Sonia Rach, who wrote an excellent children’s book about money. We also caught up with Sonia on our podcast.

Listen to our chat with Sonia on Spotify or Apple Podcast.

Plus, we also spoke to Sarah Marks on the podcast, chief executive of financial educstion charity RedSTART, on why financial education matters. RedSTART is dedicated to rexploring the outcomes of financial education in an early age setting, conducting wide-ranging research into the area.

Listen to our chat with Sarah on Spotify or Apple Podcast.

For this reason we think the GoHenry deal is great, as it provides a modern, flexible and functional tool to help parents guide their kids through the process of learning one of the most important skills in life – good money management.

Find out more about the deal on the GoHenry website. Or else you can go to the GoHenry website and enter code: AFUKFNACC

This article contains affiliate links. Affiliate links have no bearing on the editorial stance of Mouthy Money, but do help us fund our journalism and other information we provide to readers. Deals are all subject to conditions and can be withdrawn by the company in question so might expire in due course after initial publication by Mouthy Money.

Photo credits: GoHenry

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Q. Last year I earned over the child benefit threshold and had to pay it back, should I bother claiming again? 

A. If you’re over the upper threshold, you may think there’s no point claiming child benefit, but this benefit is about more than just the payment.

It also opens the door to national insurance credits for anyone who isn’t working – including stay-at-home parents. These count towards the 35 years’ worth of contributions you need to qualify for the full state pension. It’s worth highlighting that the non-working parent should make sure they receive the benefit rather than their partner. 

Instead of contacting the child benefit office and saying you no longer want to claim, you can contact them and say you want to opt out of payments. This means you will no longer receive the money, but you will still receive the credits. 

However, you may not need to opt out of payments either. The rules around when you lose your child benefit will change from 6 April.

At the moment, when one person in the household earns £50,100 or more, they face the high income child benefit charge, which means for every £100 they earn over £50,000, they have to pay 1% of their child benefit back. As a result, if they earn £60,000 or over, they need to repay it all. 

The good news is that the threshold will move in April to £60,000, and the rate at which you have to pay it back halves, so you only need to repay it all by the time one person makes £80,000. This may well mean you get to keep at least some of your child benefit. 

If one person earns over the new threshold, you may be able to cut how much of the charge you pay too, because the system counts your income after you have made pension contributions.

If it works for you to pay more into your pension, you could pay less of the charge, and in some cases may even be able to bring your income back under the threshold. 

For single parents on high incomes, there are more changes on the horizon too. At the moment, a single person earning £50,100 has to pay some of the benefit back, while a couple making £50,099 each doesn’t.

In future, the government plans to take household income into a consideration in order to level the playing field. From a technical perspective this is a major change, so there’s no timetable for it yet, but it has promised this change is coming. 

Sarah Coles has been an analyst with Hargreaves Lansdown for the past five years, after spending 14 years as a financial journalist writing for publications ranging from Bloomberg to AOL Money.

Her areas of expertise include savings and financial planning – covering everything from tax to borrowing, spending and the housing market. She is also co-presenter of HL’s ‘Switch Your Money On’ podcast.

She is passionate about encouraging people to get to grips with every aspect of their finances, not because finance is inherently fascinating to everyone, but so they have enough money for the things that really matter to them in life. 

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