Worked examplesWork and childcare
Should one of us go part-time? What dropping a day really costs
Cutting to three days looks like losing 40% of a salary. Once tax and nursery fees are counted, it's often a fraction of that, and sometimes a family ends up better off.
The short answer
−£393a month
is what going from five days to three really costs this family.
The payslip falls by £1,333 a month. Lower tax, a smaller pension contribution and cheaper nursery fees cover most of it.
The working
- Salary
- −£1,333
- Income tax and NI saved
- +£360
- Less paid into their pension
- +£67
- Nursery fees saved
- +£640
- Tax-Free Childcare lost
- −£127
- Household down by
- −£393
Those two days were earning the family about £6 an hour after tax and childcare.
It's one of the biggest money decisions young families make, usually at the end of parental leave: should one of us go back part-time? Most people look at the salary and wince. But a salary isn't what a family lives on. What's left after tax, pension and childcare is.
The scenario
| Parent 1 | £60,000 |
| Parent 2 | £40,000 |
| Child in nursery | £1,600 a month (5 days) |
| Children claiming Child Benefit | 2 |
Both working full time, after tax, Child Benefit and childcare (with their funded hours and Tax-Free Childcare), they have about £5,711 a month.
Parent 2 goes to three days
Parent 2's salary falls from £40,000 to £24,000: £1,333 a month. Here's what actually happens to the household each month:
| Each month | |
|---|---|
| Salary | −£1,333 |
| Income tax and NI saved | +£360 |
| Less paid into their pension | +£67 |
| Nursery fees saved | +£640 |
| Tax-Free Childcare lost | −£127 |
| Household down by | −£393 |
Not £1,333. £393. Those two days were earning the family about £6 an hour after tax and childcare.
The nursery saving is large because the funded hours stay the same however many days the child attends. The days you drop are the full-price ones.
When dropping a day leaves you better off
Over £100,000. Change Parent 1's salary to £108,000. Because one parent is over £100,000, the family gets no funded hours or Tax-Free Childcare at all: the £100k cliff edge. If Parent 1 drops to four days, their pay falls to £86,400, back under the line.
+£237
a month better off, with an extra day at home.
Parent 1 drops from five days to four on a £108,000 salary.
The working
| Parent 1 goes to 4 days | Each month |
|---|---|
| Salary | −£1,800 |
| Income tax and NI saved | +£763 |
| Less paid into their pension | +£90 |
| Nursery fees saved | +£320 |
| Funded hours and Tax-Free Childcare back | +£864 |
| Household better off by | +£237 |
A bigger pension contribution could get them under £100,000 without losing a day's pay. The £100k Cliff Edge Calculator compares that option.
Two children in nursery. Now make Parent 2's salary £30,000, with two children in nursery at £1,600 each. On five days, childcare costs them £1,347 a month even after support. Going to three days loses £1,000 of salary a month but saves £1,280 in nursery fees, and the family ends up £347 a month better off.
| Parent 2's days | Household money a month, after childcare |
|---|---|
| 5 | £4,471 |
| 4 | £4,646 |
| 3 | £4,818 |
| 2 | £4,775 |
| 1 | £3,660 |
The day worth more than its pay
Look at the drop between two days and one. To get funded hours and Tax-Free Childcare, both parents must earn at least about £10,576 a year: 16 hours a week at the minimum wage.
Back to the first family, with Parent 2 on two days of a £40,000 job (£16,000 a year). Dropping to one day takes them to £8,000, under the minimum, and the family loses its support.
| Parent 2 goes from 2 days to 1 | Each month |
|---|---|
| Salary | −£667 |
| Income tax and NI saved | +£67 |
| Less paid into their pension | +£33 |
| Nursery fees saved | +£320 |
| Childcare support lost | −£640 |
| Household down by | −£887 |
That day pays £667 a month but is worth £887 to the family. It's worth checking before taking on a very small role.
Who should drop the day?
In the first family, if the £60,000 parent drops to four days the household is £359 a month down. If the £40,000 parent does, it's £196. The nursery saving is the same whoever stays home, so the lower earner's day usually costs less in pure money terms.
But it isn't only a money question. Career progression, pension, how you share the load and time with your children all matter, and they're yours to weigh.
Knock-on effects worth knowing
- Student loans. Lower pay means smaller repayments, and for many graduates that simply means more is written off at the end. It can also turn a loan that would have been repaid into one that won't, which changes whether overpaying makes sense.
- Child Benefit. The charge is based on the higher earner's income alone, so if the higher earner drops below £80,000, or below £60,000, some or all of the Child Benefit comes back. How the charge works.
- Bonuses. A part-time salary can leave room under £100,000 that a full-time one didn't, so a bonus may no longer push the family over the line.
What this doesn't count
- Employer pension contributions usually fall with your pay too. That's a real long-term cost.
- Nursery pricing. We've assumed fees fall in line with the days. Many nurseries charge extra for meals and consumables, and some only offer full weeks.
- Funded hours here are England's 30-hour offer for working parents, valued at the nursery's hourly rate.
General information, not financial advice. 2026/27 rates for England, Wales and Northern Ireland; Scottish income tax differs and funded hours are England-only. Speak to a regulated adviser before acting.