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.

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Learn more about bank accounts

How can I close a Commonwealth Bank account?

You can close your Commonwealth Bank account at any branch, provided you have appropriate identification. You can also close your account over the phone, by calling 132 221, 24 hours a day.

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.

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 find bank accounts in my name?

To find ‘live’ bank accounts in your name, you’ll have to ask individual lenders, which involves contacting them one by one and proving your identity each time. To find ‘unclaimed’ bank accounts (those that have been inactive for at least seven years), you can use this website.

Can you find your bank account number online?

If your bank offers online services, you should be able to find your bank account number online by logging into your account on your bank’s website and checking your details there.

Keep in mind that each type of account you have with a bank comes with a unique account number. This means if you have a bank account as well as a savings account, for example, your bank account number and your savings account number will be different.

If you don’t have access to your bank account online or can’t login, you should be able to find your account number on a mailed bank statement, if you have one.

Alternatively, you can call your bank’s customer service number or visit a branch to retrieve your account number.

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.

Can you get a payday loan without a bank account?

Yes. Some payday lenders are willing to transfer loans to prepaid debit cards instead of bank accounts.

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.

Can I link a bank account to Paypal?

Paypal is a safe and convenient way to pay online without the need to share your financial details. You can send and receive money or accept credit and debit cards as a seller using Paypal.

It’s easy to link your bank account to a Paypal account and start making transactions within minutes.

To start, you first need a Paypal account (it’s free to join). When setting up your Paypal account, you will be prompted to link a credit card or bank account (or both if you wish).

PayPal works without a balance; you can use Paypal to shop or send money when your balance is zero.

When your Paypal balance is zero, Paypal will ask you to choose your preferred payment method at the checkout.

This could be either your linked bank account or credit card. Your bank details can be updated if you change banks or credit cards.

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.

How do I close a bank account?

Closing a bank account is one of those tasks that’s easy to put in the too-hard basket. There are quite a few steps involved, some which may require you to hang on the phone for a while.  

Here’s a handy checklist of items to tick off, so the job gets done quicker. If you don’t do your banking online, the following steps can also be done at a branch.   

  • Cancel any scheduled or recurring payments
  • Update your direct debit details (such as loan repayments) with creditors
  • Export your payee address book (to keep a record of saved third-party bank account details)
  • Transfer the balance of your account (to the new bank account)
  • Close your account online, or by calling the bank or visiting a branch

How do I open a new bank account?

There are a number of ways to open a new bank account – online, over the phone or in the branch. The trick is to decide what type of bank account you want beforehand.

It might sound like a simple enough task, but there are literally hundreds of bank accounts to choose from. And each offer their own banking features and benefits.

A comparison site like RateCity can help you work out what bank account product matches your needs.

Once you’ve made up your mind what you want, it’s advisable to have the following information ready for the application process.

  • A couple of forms of identification (such as driver’s licence, Medicare card, passport)
  • Tax file number
  • Residential address, contact phone number and email (though email is not essential)

How do you change your account name on NAB banking?

Changing the name on your NAB bank account is straightforward, as long as you have the right documents.

If you’ve just got married, divorced or legally changed your name, here’s what you need:

  • Married – a marriage certificate
  • Divorced –your ‘decree nisi’
  • Legal name change –your legal name change certificate

You can take either the original document, or a certified copy, into a NAB branch, where it needs to be sighted by a bank employee and a copy taken.

Your NAB bank account name will be updated immediately. New debit, ATM and credit cards with your updated name will also need to be issued. These usually take between five to 10 working days to be posted out to you. Your existing cards will keep working until you activate your new ones.

If you haven’t legally changed your name, but just want to change your account nicknames, you can log onto NAB and do it through the Settings/Mailbox menu.

Can a debt collector garnish my bank account?

A debt collector can garnish your bank account, but only with a court order. This drastic action is usually taken only if you’ve ignored several notices asking you to pay the debt.

If this happens, there is nothing you can do to stop it other than immediately pay back your what you owe in full or make arrangements to pay it off in installments.

Once a garnishee order is issued, your bank will put a freeze on your account as it processes the order. This usually takes two to three days and you won’t be able to access any of your money during this time.

If you have Centrelink payments, they may be protected, depending on what the court order says.