April 2022. My daughter was five months old and asleep against my chest in the sling when the email from the nursery arrived — I read it standing in the hallway, keys still in my hand. Three lines. The September places had gone. We would stay on the waiting list, and they would be in touch if anything changed. I had put her name down while I was pregnant, confirmed it after the birth, phoned twice. I was discovering, a little late, that a waiting list promises nothing — except a line on a spreadsheet.
That evening — my daughter finally asleep — I opened our local council's list of registered childminders. Three weeks later we had visited three and signed with the second — a calm woman ten minutes' walk away, who asked how my daughter fell asleep before she mentioned money. My daughter is three now, and I don't regret that choice. But that spring I would have loved an honest comparison. What each option costs once the help is taken off, what it covers (and what it doesn't), and when you need to start.
If you are searching now, the picture has shifted since my own hunt. Since September 2024, eligible working parents in England can claim 15 funded hours a week from the age of nine months. According to Coram Family and Childcare's Childcare Survey 2025, working parents of under-threes in England now pay less than half of last year's price for a part-time nursery place. The funded hours don't solve everything, though (not the waiting lists, not the holidays, not the morning your baby wakes with a temperature). This guide compares the three main options on four criteria — real cost, hours, availability and your child's experience. Then it sets out the timeline, month by month.
Nursery, childminder or nanny: three ways to care for a baby
The three main types of childcare differ in more than location. Each rests on a different relationship: a setting that sells you a service, a self-employed professional who cares for your child in her home, or an employee who works in yours. That relationship shapes almost everything else — the price, the help you can claim, the flexibility. And what happens on the morning your child is ill.
A day nursery cares for children in a group setting, with several early years professionals looking after them. Many are private, voluntary or independent settings; others are run by schools or local authorities. To receive government funding, a nursery must be registered — with Ofsted, in England. Your child spends the day with a team and a group of children.
A childminder looks after a small group of children in her own home. The rules are clear: a childminder must register — with Ofsted or a childminder agency — when the children are under 8, she looks after them for more than 2 hours a day and she is paid (including payment in kind), according to GOV.UK. A registered childminder works for herself, so you pay fees rather than a wage. Because she is registered, she can offer funded hours — and accept Tax-Free Childcare payments once she has signed up to the scheme.
A nanny cares for your child in your own home. You can employ one alone or share her with another family (a nanny share, in which both households split the cost). Unlike a childminder, a nanny is normally your employee — which brings payroll, pension and holiday duties. Nannies don't have to register with Ofsted, but they can join the voluntary part of the Childcare Register.
| Criterion | Day nursery | Childminder | Nanny |
|---|---|---|---|
| Where | the setting | her home | your home |
| Your role | customer | customer | employer |
| Registration | Ofsted | Ofsted or an agency (compulsory) | voluntary Childcare Register |
| Tax-Free Childcare | if the setting is signed up | if she is signed up | only if she is on the Childcare Register |
| Group size | larger group, several staff | small group, one carer | your child (two families in a share) |
What does each type of childcare really cost?
For a working family in England, the funded hours have changed the maths for under-threes. Take a 25-hour week at a nursery for a child under two. Once the 15 funded hours are taken into account, Coram's figures put the average at £70.51 a week — you pay for 10 hours. The same 25 hours cost £176.27 for families who aren't eligible. At a childminder, the figure without funding is £149.41.
| England, child under two | Nursery | Childminder |
|---|---|---|
| 25 hours a week, with the working parent entitlement | £70.51 | £59.76 |
| 25 hours a week, without funded hours | £176.27 | £149.41 |
| 50 hours a week, with the working parent entitlement | £238.95 | £202.09 |
Full-time care is where the gap widens. For 50 hours a week (you pay for 35 of them), a nursery place for an under-two averages £238.95. That is 18% more than a childminder, at £202.09. The saving from funded hours is smaller in percentage terms, too. Coram notes that full-time prices fell by just over a fifth (21.5%) — against more than half for part-time places.
Pay that full-time bill through Tax-Free Childcare and your share falls to about £200 a week: the government adds 20%, but its top-up is capped at £500 a quarter per child (about £38 a week).
Where you live matters as much as which option you choose — sometimes more. A 25-hour nursery week for an under-two, after funding, averages £92.01 in Inner London against £60.51 in Yorkshire and the Humber. Outside England the picture is different again. These entitlements for under-threes don't apply in Scotland or Wales. There, the same part-time nursery place costs £122.38 a week in Scotland and £155.04 in Wales.
Funded hours and Tax-Free Childcare: what the help covers
Three kinds of help reduce the bill for most working families in England — the funded hours, Tax-Free Childcare and, for lower incomes, the childcare element of Universal Credit.
The funded hours for working parents have arrived in stages. Since April 2024, eligible working parents of two-year-olds can claim 15 hours a week. Since September 2024, the same applies from the age of nine months. From September 2025, the entitlement rises to 30 hours a week from nine months until school. To qualify, each parent (and a partner, if you have one) must earn at least the equivalent of 16 hours a week at the National Minimum Wage or Living Wage. Neither of you can earn more than £100,000 a year.
Tax-Free Childcare, as GOV.UK explains it, works through an online account: for every £8 you pay in, the government adds £2. The top-up is capped at £500 every three months per child — up to £2,000 a year, or £4,000 for a disabled child. Your provider must be signed up to the scheme, and your child must be 11 or younger. It can be used alongside the funded hours, but not alongside Universal Credit.
Universal Credit claimants can instead claim back up to 85% of their childcare costs (up to a monthly limit). That route suits lower incomes — for most families above that level, Tax-Free Childcare is the one to set up.
One more detail matters. Updated statutory guidance makes it clear that any additional charges to parents using the funded entitlements must be voluntary, according to Coram. Providers will need to list these charges clearly on invoices, and parents who opt out must be offered reasonable alternatives.
Employing a nanny: the costs behind the hourly rate
A nanny is the most flexible option and, for a single family, usually the most expensive. You are not paying a fee — you are paying a wage. According to GOV.UK's guidance on employing someone to work in your home, you are usually the employer of a nanny you hire directly. That means running payroll and deducting Income Tax and National Insurance. It also means paying at least the minimum wage, providing a workplace pension (if she is eligible), giving paid holiday and holding employers' liability insurance.
The floor rose in April 2025 — and so did the extras. According to GOV.UK, the National Living Wage for workers aged 21 and over is now £12.21 an hour, up from £11.44. For a 50-hour week, that is a legal minimum of £610.50 gross (50 × £12.21) — before employer National Insurance and pension contributions. Employer costs rose at the same time. Coram notes that employer National Insurance contributions increased from 13.8% to 15% in April 2025. The threshold at which employers start paying fell from £9,100 to £5,000 a year.
A nanny share spreads that cost between two families — both employ the same nanny together. It works best when both households agree in writing how hours, costs and the host home are divided. One condition applies to every nanny. To pay her with Tax-Free Childcare, she must be registered with Ofsted on the voluntary Childcare Register.
Opening hours, holidays and illness: what each type of childcare covers
A nanny offers the most flexibility and a nursery the least. Yet the logistics, not the fees, often decide whether childcare survives: the closing time, the week in August, the temperature on a Tuesday morning.
Nurseries work to fixed opening hours and their own closure dates — which are not necessarily yours. Childminders set their hours in the contract you agree together — an advantage if you start early or finish late, as long as you negotiate it from the outset. In return, her holidays and sick days become yours to cover. With a nanny, you set the hours as employer, and your child stays at home.
Illness is the part most parents underestimate. The NHS guidance on whether a child is too ill for school or nursery is clear: if your child has a high temperature, keep them off until it goes away. Children with diarrhoea or vomiting should stay away until they have not been sick or had diarrhoea for at least 2 days (48 hours). In the first winter of group care, that can add up quickly.
| Situation | Nursery | Childminder | Nanny |
|---|---|---|---|
| Hours | fixed opening hours | agreed in the contract | yours to set |
| Holidays | setting closures | her holidays, to plan around | her holidays, agreed with you |
| Your child is ill | home until well | depends on the contract | your child stays at home |
Why a nursery or childminder place can take so long to find
Most councils in England report enough places for children using the funded hours — far fewer do for families outside them. Coram's survey asked local authorities in England a simple question — did they have enough childcare for at least 75% of children in each group? For children aged two and under using the working parent entitlement, 79% said yes. For children of the same age without any funded entitlement, the figure dropped to 59%. For parents working atypical hours (early starts, late finishes, shifts), only 22% of local authorities reported enough childcare.
Many nurseries keep waiting lists, and places tend to open up in September — when older children leave for school. That is why the search usually begins well before the start date you have in mind.
Your child's experience: what the research says
For your child, no option is bad in itself, and the differences research has measured are small. What matters most is the quality of the relationship between your child and the adults who care for them.
In 2024, a meta-analysis of six birth cohorts published in The Lancet Regional Health – Europe pooled data on 87,208 parent-child pairs in five countries, including the UK's ALSPAC cohort. Compared with children cared for only by their parents before school, those who attended centre-based childcare showed slightly lower levels of internalising symptoms (anxiety, low mood, withdrawal) during childhood.
Three caveats apply. The authors themselves describe the effect as small. The study is observational — it finds an association, not proof that nursery causes it. Finally, the "informal childcare" group — which mixes grandparents, friends, nannies and childminders — showed the opposite: slightly more internalising symptoms at 7–13, and slightly more externalising ones (attention difficulties, aggressive behaviour). The authors stress how mixed that group is. So it cannot tell you anything specific about a registered childminder.
Parents' own priorities are revealing. In Coram's pilot survey of parents (run in England in autumn 2024), 92% put hearing about their child's day among the three most important things about a setting. And 73% ranked outdoor space in their top three. Over half (52%) chose "friendly and kind" as a top-three staff quality. In Coram's focus groups (December 2024), many parents said they trusted other parents' opinions more than Ofsted ratings — partly because reports can be up to five years old. For one parent, what mattered more than any formal indicator was simple: "He loves it. He runs into the door".
Each option offers a different kind of day. A nursery brings routine, a group and several adults. A childminder offers a small group and one familiar carer in a home. A nanny keeps your child in their own surroundings with one adult. Wherever those days happen, you will find ideas in our guide to play-based activities for every age.
The childcare timeline, from pregnancy to your return to work
The search starts during pregnancy, long before most of us want to think about it. The starting point is your leave. According to GOV.UK's maternity leave rules, Statutory Maternity Leave is 52 weeks — 26 weeks of Ordinary and 26 weeks of Additional Maternity Leave. Only the first 2 weeks after the birth are compulsory. With funded hours available from nine months, a start date around that age can make sense.
| When | What to do |
|---|---|
| Second trimester | work out your hours, list nurseries and childminders nearby, check your council's website |
| Third trimester | visit two or three nurseries, join waiting lists, contact childminders |
| After the birth | confirm your waiting-list places, check eligibility for funded hours |
| Before the start date | apply for funded hours, open a Tax-Free Childcare account |
| A month before your return | sign the contract, book settling-in sessions, plan a back-up |
Your local council's website lists registered childminders in your area, along with early years education and family support. Once you are using funded hours, remember that you have to reconfirm your details every three months. To place all of this alongside your antenatal appointments, our pregnancy week-by-week guide gives you the milestones month by month.
Choosing a childminder or nanny: the questions that matter
Choosing a childminder or a nanny means choosing the person your child will spend most of their days with. The interview deserves more than a price list. For a childminder, start with her Ofsted registration and latest inspection report (they are published online). Visit when the children are there — not just on a quiet Saturday morning.
A few questions open up a real conversation. What does a typical day look like? Where do the children nap, and how do you follow each child's routine? Where do you go on outings? How will you tell me about my child's day? What happens during your holidays or if you are ill? The answers say a great deal about the place children hold in her day.
For a nanny, the same questions apply, with a few more: experience with babies, references from previous families, how she handles the unexpected. In a nanny share, hold one meeting with both families and the candidate — then put the split of hours, costs and host home in writing.
Whatever you choose, read the contract line by line (and keep a signed copy). It sets out hours, fees or salary, holidays, notice and what happens when your child is ill — and it is the document that settles any disagreement later.
How to choose childcare: a simple framework
The right childcare is the one your budget and your hours can sustain — not the one with the best reputation. Four questions usually settle it.
How many hours do you need? For part-time care, the funded hours make a nursery or childminder very affordable in England. For full-time care, a childminder is on average cheaper than a nursery. Are your hours unusual? Early starts, late finishes and shifts suit a childminder or nanny better than a setting with fixed hours. What is available near you? With only 22% of councils reporting enough childcare for parents on atypical hours, the local map matters more than preference. What reassures you? A group with a team, one familiar carer, or your own home: write down what reassures you, and visit with that in mind (the answer can change as your baby grows).
You don't have to choose just one — a nursery for three days and a grandparent on the fourth, for example. Start by writing down your three numbers (hours per week, household income, return date) — then compare them with the figures in this guide.
Frequently asked questions
How many funded hours can working parents get in England?
Since September 2024, eligible working parents can claim 15 hours a week for 38 weeks a year from the age of nine months. From September 2025, this rises to 30 hours a week from nine months until school. Each parent must earn at least the equivalent of 16 hours a week at the National Minimum Wage or Living Wage, and no more than £100,000 a year.
When should I put my baby's name down for a nursery?
Many nurseries run waiting lists for baby rooms, so parents often register during pregnancy. Ask each nursery how its list works, when places usually open and whether you need to confirm your interest after the birth.
Is a childminder cheaper than a nursery?
For full-time care, usually yes. Coram's 2025 survey found that 50 hours a week for an under-two in England costs £238.95 at a nursery and £202.09 with a childminder, after the funded hours. For part-time care, both are much cheaper for eligible working parents.
Can I use Tax-Free Childcare with the funded hours?
Yes. Tax-Free Childcare can be used alongside the funded hours to pay for extra hours — as long as your provider is signed up to the scheme. It cannot be combined with Universal Credit childcare support.
Does a nanny need to be registered with Ofsted?
No, nannies are not legally required to register. But if you want to pay a nanny through Tax-Free Childcare, she must be registered on the voluntary part of the Childcare Register.
What is a nanny share, and is it cheaper?
Two families employ the same nanny together and split her wages and employer costs. It keeps the flexibility of care at home while sharing a bill that starts at £12.21 an hour gross for a nanny aged 21 or over, before National Insurance and pension.
What happens if my child is ill on a childcare day?
NHS guidance is to keep a child with a high temperature at home until it goes away, and to keep them off for 48 hours after the last bout of diarrhoea or vomiting. Plan a back-up before you return to work: a relative, a day working from home, or your employer's policy on time off for dependants.
Sources
- Coram Family and Childcare — Childcare Survey 2025
- GOV.UK — Tax-Free Childcare
- GOV.UK — Become a childminder or nanny (England)
- GOV.UK — Employing someone to work in your home
- NHS — Is my child too ill for school?
- The Lancet Regional Health – Europe (2024) — Early childcare arrangements and children's internalizing and externalizing symptoms: an individual participant data meta-analysis of six prospective birth cohorts in Europe