Childcare fees are back – tips to keep costs down

Childcare fees are back – tips to keep costs down

Any parent can tell you that one of the most expensive parts of having children is the childcare fees you pay in their early lives.

After more than three months of not paying a cent for childcare, thanks to relief offered by the Australian government in response to the COVID-19 pandemic, families will start paying fees again this week.

But there is still assistance available that can offer a helping hand, and steps you can take now that may save you hundreds of dollars.

Government offering a lifeline

The Australian government does provide financial assistance by offering childcare cost subsidies.

From Monday, families are back to the old subsidy system, but this now has updated income thresholds.

If your family earns $189,390 or less, you won’t have an annual cap on your subsidy. Further, if your family earns between $189,390 and $353,680, they’ll cap your subsidy at $10,560 per child each financial year.

Childcare subsidy thresholds:

Your family income Childcare subsidy percentage
$0 to $69,390 85%
More than $69,390 to below $174,390 Between 85% and 50%

The percentage goes down by 1% for every $3,000 of income your family earns

$174,390 to below $253,680 50%
$253,680 to below $343,680 Between 50% and 20%

The percentage goes down by 1% for every $3,000 of income your family earns

$343,680 to below $353,680 20%
$353,680 or more 0%

Source: Services Australia.

To be eligible for this you must:

  • Care for a child 13 or younger who's not attending secondary school, unless an exemption applies;
  • Use an approved childcare service;
  • Be responsible for paying the childcare fees; and
  • Meet residency and immunisation requirements.

What the government is offering families doing it tough

While relief on childcare costs may be over, the impacts of COVID-19 are still being felt by millions of households.

For those doing it tough, the government is easing the work activity test for its childcare subsidy to help people who have lost their jobs as a result of COVID-19. These families will receive up to 100 hours of care that will be subsidised for up to 12 weeks.

This may potentially mean all their fees are paid, even at a more expensive centre.

If you believe your family would qualify for this assistance, ensure your details are up to date on the MyGov website.

For postcodes that have been heavily impacted this year, whether by lockdown or bushfires, the government is also providing an additional childcare subsidy. It will cover 13 weeks of childcare fees. You will need to apply through Services Australia

Don’t qualify for hardship but can’t afford childcare fees - what now?

If you’re in the awkward position of struggling financially to afford costly childcare fees, but unable to qualify for hardship support, don’t panic. There are still things you can do.

  1. Speak out. It’s worth talking to your childcare centre about any financial problems you’re facing. While it can be embarrassing, it’s still an important conversation to have. The childcare centre may offer solutions you’re unaware of.
  2. Shorter days. Some childcare centres may offer shorter days at a reduced cost. Childcare centres have said they are worried about their roll plummeting, so may be able to reduce fees as an incentive to keep families.
  3. Update your budget. If you haven’t already, now is an ideal time to consider updating your family budget to try and free up some cash. There are plenty of budget templates available on Pinterest, as well as budgeting websites, that may help.
  4. Negotiate your home loan rate. If you’re paying off a home loan, call your bank and try to negotiate a better rate. Banks typically offer more competitive rates to new customers to incentivise them joining with your bank. Hop online and find out what rates they’re offering new customers, then call your bank and request a lower rate. or consider going onto a lower fixed rate, if that works for you.
  5. Switch to a lower rate home loan. If talking your way to a lower rate doesn’t work, you may want to consider switching to a lower-rate home loan. With interest rates at record lows, there’s hundreds of dollars in repayment savings up for grabs for borrowers willing to shop around for better deals.
  6. Sell some belongings. Consider finding some belongings you don’t need and selling them for some extra cash. It’s school holidays, so many parents will be looking for new toys and sporting equipment to help them entertain their kids. Facebook Marketplace and Gumtree are great platforms to help you sell your items.

Did you find this helpful? Why not share this news?



Money Health Newsletter

Subscribe for news, tips and expert opinions to help you make smarter financial decisions

By submitting this form, you agree to the RateCity Privacy Policy, Terms of Use and Disclaimer.


Learn more about bank accounts

Can I have a PayPal account without a bank account?

You don’t need a bank account to send or receive money through PayPal. However, you do need a bank account if you want to withdraw money from your PayPal account.

How do you open a bank account under 18?

If you’re under 18 and you want to open an Australian bank account, you will need your passport or birth certificate. (Some lenders might require just a Medicare card or driver’s licence.) You can apply online or at a branch. If you’re 13 or under, you will probably need a parent to accompany you to a branch.

How do you deposit change into your bank account?

One way to deposit change into your bank account is to visit a branch. Many lenders will also allow you to deposit your change through one of their ATMs.

How can I check my bank account balance online?

Checking your bank account balance online is a simple process. Once you’ve logged in to your online banking, clock on the relevant account and the balance should be visible.

How can you cash a cheque without a bank account?

You can cash a cheque without a bank account if you visit the bank that issued the cheque. For example, if somebody sends you a cheque from Bank X (as written on the cheque) and you visit Bank X, it’s likely that Bank X will let you cash the cheque – provided the person who wrote the cheque has enough money in their account. Bank X would probably charge you a fee for the service.

What do I need to open a company bank account?

To open a company bank account, you will probably have to provide 100 points of ID, an ABN and an ACN. You will probably have to provide the details of all signatories as well.

Can foreigners open bank accounts in Australia?

Many Australian lenders allow foreigners to open bank accounts in Australia. Often, this can be done before you arrive in the country – with no Australian address required. When you get to Australia, you can pick up your debit card, using your passport as identification.

How can I deposit cash into my bank account?

The traditional way to deposit cash into your bank account is to go to a branch and give it to a teller. These days, many banks will allow you to make deposits through an ATM as well.

Do you need a bank account to sell on eBay?

You don’t need a bank account to sell on eBay. But if you don’t have a bank account, you must provide either a credit card or debit card.

Can I find my bank account number online?

Yes, you can find your bank account number by logging into your online banking and clicking on the relevant account.

How can I wire money to a bank account?

You can wire money to an Australian bank account either through your own bank or by using a money transfer company such as Western Union or MoneyGram. Either way, you’ll need the other person’s name, BSB number and account number. If you use a money transfer company, you might also need to provide the recipient’s address for large payments.

Can you open a bank account at 16?

Yes, you can open a bank account at 16, or even younger. If you’re 13 or under, you will probably need a parent to accompany you to a branch.

Which bank is best for business accounts?

Unfortunately, there’s no definitive answer to the question of which bank is best for business accounts. That’s because ‘best’ will differ from customer to customer, depending on their unique circumstances. These include not only your company’s financial position, but also its size, its age and the sector in which it operates. Another factor to consider is what features you want in a bank account. Your business may require different features than another business; and your business may require different features tomorrow than it does today.

The best thing to do is to thoroughly research the market before opening a business account. And when you do open an account, you should reassess your options every year or two, because the market moves quickly. A particular bank might offer the best account today, but be surpassed by one or several rivals tomorrow.

Can I open bank accounts for my children?

A common question for new parents is, ‘Can I open a bank account for my child?’

The short answer is yes – as a parent you can open a bank account for your child.

Once you’ve compared your options and found a bank account that suits your needs, the process is relatively simple.

As the bank account is for your child, you’ll need to provide some documentation such as proof of ID, including your tax file number.

You will also need a copy of your child’s birth certificate, and in some cases you may also need to sign a guarantee of indemnity.

Depending on the bank and whether you’re an existing customer, you may be able to open a bank account for your child online. However, you may still need to go into a branch to prove your identity.