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Chatting to our IFA, just sorting out a new mortgage deal he motioned most banks are adjusting their affordability calculations slightly in readiness for 2022. Increasing the buffer they use for living expenses when they decide how much you can borrow. This doesn't effect, or worry me per-se, but the reasoning behind it obviously does.
I hadn't really taken the time to put all the pieces together, but in the 6 months or so, we can all look forward to the following:
Big rise in Energy costs, 50% for some on really good fixed deals that are ending, but that's only until April 2022, when they will adjust the price cap again. If the wholesale price doesn't fall, it will be rising, and by A LOT.
Increase in NI Payments.
Increase in Council Tax, I think it's only £10 a month extra for us, but it all adds up.
Possible rise in Income Tax / VAT, Duty etc. By the sounds of the Tory conference, they've not finished with the bad news yet.
Price rises on pretty much everything else.
I've been looking through our family finances, all things being equal, by April 2022 we'll be £120-£180 a month worse off, and that's not including any as yet unannounced tax rises, or general inflation on essentials like food.
Don't get me wrong, we're lucky. We've both got good jobs. We're by no means wealthy, but we have enough that we'll still be able to pay our bills and have a 'lifestyle'. We won't suffer the double blow of the reduction in Family Credit, but I know a lot of people who are already finding things tough going, a reduction like that will really hurt them.
Hopefully junior will become financially independant at some point during 2022, that would mean 30% deflation in our fixed outgoings - coke and hoo... nah, boring. Horses, guitars, bicycles, holidays ... here we come.
There's a recession on the way, some raging inflation for a while and plenty of misery of epic proportions for us minions.
We’re all in this together…
at least us plebs are. Someone has to pay for those dodgy PPE contracts.
Think this is global or European wide or more UK specific as most of these problems are either thanks to our amplified by brexit?
Horses, guitars, bicycles, holidays … here we come.
Sorry dude - if horses are involved there will be no spare money for guitars, bicycles or holidays!! 🙂
I do think we're seeing the multiple Brexit + pandemic + climate change financial impact gathering pace.
It's not going to be pretty.
I'm relieved to have just signed a 5 year mortgage fix, sold the BTL and not planning any more borrowing beyond £1k of outstanding car loan.
I'm also glad to have three kids/young adults tucked up in education and all working part time.
We're very fortunate and yet it still causes me concern. I was reading a thing this morning predicting that the Chinese property company and global issues may see us have the biggest stock market crash in history too... (Not sure if I believe that too much)...
the Chinese property company and global issues may see us have the biggest stock market crash in history too
It's all priced into their bond values already as it's been a long time coming. The only unknowns are exactly how many companies will default by how much. The CCP will ensure some fingers get burnt but won't allow a total collapse as that would upset Chinese consumers.
Due to remortgage next year, two young kids, meagre savings and one income. Tough times or life of crime here we come!
I'm thinking overall cost of everything will be up 6-10%. Going to be painful for a lot of people sadly
get rid of things you dont need.
sky tv or any other pay per view.
go pay as you go on a budget phone.
eat less meat, treat it as a luxury once a week.
stop drinking.
if i did all these i would soon be back in pocket.
Just waiting for the sale of our flat. Then after clearing the mortgage, sticking £10K in both the kids accounts, and clearing my credit card I will be debt free for the first time since i turned 18 (31 years ago !!) and have a few quid in the bank to boot. Couldn't have come at a better time and not having anything hanging over me financially is a relief with these uncertain times ahead.
Appreciate I am very fortunate, but have been at the opposite end without a pot to piss in , and had I not taken the plunge to go self employed 6 years ago , I certainly wouldn't be in this position now.
Similarly, 4 mortgage payments to go.
Not a humblebrag, quite the opposite, been working hard and overpaying for years, it wasn't easy.
We’ve been overpaying mortgage for years, also took out a 10yr fixed 2 years ago, which will take me to 2 years from end of mortgage.
Whilst both in well paid jobs, I am still on a much lower salary than pre-Covid, so will have to make changes, which will be manageable thankfully.
It seems like the first few of us to post, possibly even a reflection of the STW demographic, are not the 'average' UK household.
The changes brought in and increases in basic necessities are going to affect those on low income far more. Brutally so - it's food, energy and housing costs that cannot be avoided.
It's also got the possibility of hurting many in the 'squeezed middle' who while earning well have a lot of debt and (life choices) outgoings. Of course the biggest issues there are employment and mortgage interests rates.
Yes, I agree Matt. I've no idea how a single parent in a low paid role does it.
Agree with the above, it is going to be horrible for those who are either only just managing now or are already underwater. I can't imagine how that must feel
get rid of things you dont need.
sky tv or any other pay per view.
go pay as you go on a budget phone.
eat less meat, treat it as a luxury once a week.
stop drinking.if i did all these i would soon be back in pocket.
Me too. But if you cut back on your consumption then all of a sudden there doesn't need to be the same number of drivers, shop staff, warehouse workers etc.
With no debts and a job for life (at least as far as one of those exists these days, haha) I'm not worried - which probably means I'll be redundant by January and on the streets by March... 😀
Think this is global or European wide or more UK specific as most of these problems are either thanks to our amplified by brexit?
I think it's impossible for most of us to really know how much is Brexit and how much is Covid and other factors, I think most are a bit of each. The energy problem is global, but not helped by trade disputes with the EU, coming at the same time as North Sea probably doesn't help.
Tax (or rather NI) rise is being sold as to boost the NHS, but it could just as easily be Brexit, but the Tories will never say as much.
Johnson's speech today is going to be very telling, he's talking big changes, and I can't see them being very good for the common Man and Women, however he spins them.
I'm starting to regret only taking a 2 year fixed rate deal on the mortgage...
I’m starting to regret only taking a 2 year fixed rate deal on the mortgage…
Yeah, we're 2.5 years into a 5 year fix
Cost a lot to get out of it and fix again, so just going to have to weather the storm
I'm fully expecting the shit to hit the fan in the next 12 months for me. My savings are getting very low (got 2 months of bills left) and I've not got permanent work so things are a bit close to the bone for my liking. How people who live from paycheck to paycheck are going to cope I have no idea!
Thankfully I have no debt and my outgoings are as low as I can get them (barring Spotify, Amazon Prime and Zwift which can be cancelled immediately) plus my rented flat only needs a month's notice to leave so if it does get as tough as I think it is I can drop everything and go back to my parent's house with a month's notice. Doing that though will severely limit my job prospects and be a real blow mentally, it will be the sign that my life has completely changed in the last 2 years.
I think it’s impossible for most of us to really know how much is Brexit and how much is Covid and other factors, I think most are a bit of each.
That is true but there is no way in hell that Brexit isn't making our exposure and ability to respond worse than if it hadn't happened.
I’m relieved to have just signed a 5 year mortgage fix
Same here - just built a whopping extension, spaffed half our savings and fixed on a rate lower than our previous 2 year rate. Selfishly a period of high inflation wouldn't be the worst thing in the world for us right now. I'm no Tory by any strech of the imagination, but their complete cluster **** of a government does seem to be working for us at the moment.
For the many millions whose lives are difficult today 2022 will move to way beyond difficult.
Listening to johnson's conference speech, he clearly has no interest in doing anything to improve that.
our only significant outgoing is 3 days a week childcare for the youngest. He'll move to 30 hours 'free' (read discounted) childcare, so our costs there will drop significantly, more than offsetting any rises in utility bills. Otherwise debt free (inc mortgage), so unless I lose my job I'm expecting everything to be pretty normal
Yes you are right to be worried as the personal inflation basket on a low earner will be much higher than higher earners. That's because energy, food, council tax are a high proportion of their spend, and there's not a lot you can do about the higher prices.
Sadly a lot of people are living on the edge and this will tip them into debt.
Heard on the news the other day that as many as 4 million families are already in a position where cost of living is up to £9k per annum more than income. How many suicides are going to be caused by spiralling debt just to exist?
Heard on the news the other day that as many as 4 million families are already in a position where cost of living is up to £9k per annum more than income.
Maddness! Puts things in to perspective.
If I were single and in your position I think I would go on the road and do seasonal work on farms. Loads of work, not badly paid, flexible with. Other opertunities may arrive.
If career is important to you I would do the same but short term contracts. Quickly gain experience and move where the jobs are. Travel inbetween jobs taking time out.
Currently busy reducing any debt. Mortgage gone, hammering re-payments on the credit card to get it to zero. Should be OK, electric bills are sky high, mainly due to WFH, so we're not going to use the shed office and conservatory to work from as much over winter (both back 2-3 days in the office). Gas is quite low as the house is efficient, so gas going up, even double is only £40 a month.
I'm back commuting to work by bike when in the office - that's saving £6 a day in wasted fuel. No plans on a foreign holiday (CBA with testing). Trying to get my son to try harder at a full time job - he's just part time after losing his full time job - but he's depressed and it's not helping.
We should be OK, but as earlier, down a couple of hundred a month.
Sadly a lot of people are living on the edge and this will tip them into debt
If you look at the number and size of foodbanks running in what is purportedly the 7th richest economy in the world, a lot of that lot are sadly already beyond the edge. Inflation in unavoidable costs, tax rises outside the personal allowance. (because that's what national insurance increases are, let's be clear about that!) and the imminent £20/week benefits reduction are disproportionately going to impact the poorest in society.
Tax rises should have been lumped on the higher rates by adjusting the 40% boundary lower or just increasing the % for those in the 2 highest bands, (and that includes me) but that wouldn't suite the Tories natural audience of supporters. Absolute shower of ****.
If you are under the age of 40 and don't have the bank of mum and dad you have no chance in Brexit Britain. I think we will have 2012 style riots again next year, no way can we just keep writing whole sections of society off, while the rich get ever richer and think people will put up with it.
It seems like the first few of us to post, possibly even a reflection of the STW demographic, are not the ‘average’ UK household.
Hardly surprising, not many people worrying about how to pay next month's mortgage / fuel bill have time / energy to chat on a cycling forum....
@TheBrick - not practical when I've got 2 elderly parents to look out for otherwise I'd be looking at something like working on cruise ships. A friend did it for 2 years after uni and managed to build up a sizeable savings pot despite lots of partying and other stuff while on board.
Indeed. Despite the protestations when Mark states that his research shows STW users, are, on average, comfortably better off than the national average, a glance at the 'watches N+1' thread or the 'retirement' thread, or the 'skiing holidays' threads, (and so on and so forth) suggests that STW'ers are in general, not exactly hard up.
in what is purportedly the 7th richest economy in the world
Sorry to pick you up on this and it's not personal but I really hate this claim that 7th richest country in the world is important. 7th richest is important when it comes to external affairs such as aid we give, or our potential as a market but internally it's much much less relavent as it's a per capita, or really per capita but then scales for dependency ratios that's important. GDP per capita puts us at 26 but that doesn't take I to account dependency ratio. On top of that GDP can be misleading.
Not saying it's right that people are struggling but people need to understand these basics. 7th richest is meaningless or at least limited meaning
What he said ^, largest economy, not richest.
I thought it was fifth though? US, China, Japan, Germany, UK, France but UK and France are very close and swap positions every now and again. Has India lept up all of a sudden?
Actually, I could just google that
My daughter starts nursery next month, costing £1300/month. This feels like poor timing…
If you are under the age of 40 and don’t have the bank of mum and dad you have no chance in Brexit Britain
I'm in that category as is pretty much everyone who works for me in the uk. Well paid industry and they're all fine.
Fairly low earner here, not looking forward to massively increased fuel bills. On the bright side, my car loan finishes in a couple of months so that’s an extra £227pcm to spend on utilities. 🙄
I wouldn't be supprised if we had the 7th richest poor people in the world..
Is it case of everything being so cheap for the last 10 years?
Food
Loans
Fuel ect
It's all been peged down by global influence especially china. Some people have never know interest rates above 2%
It's going to get hard for people on all different wages.
Buy now pay later really will come home
I thought it was fifth though?
That was pre-Brexit, we dropped a couple of places since then.
I wouldn’t be supprised if we had the 7th richest poor people in the world..
Again, wealth in $ or £ terms is meaningless, plenty of people can survive on a few $ a day in parts of Africa, but you would freeze / starve to death in the UK on that.
You need to look at wealth in terms of what it can buy in your country eg loafs of bread or average rental on a 1 bed flat etc. You could be a millionaire but if a loaf of bread cost £5m you'd still starve to death.
Sorry to pick you up on this and it’s not personal but I really hate this claim that 7th richest country in the world is important.
S'OK, I'm not offended. That's quite an interesting distinction, I learned something.
I thought it was fifth though?
Well I didn't google it beforehand either, I'm sure 7th was the telly report statement when that big summit was going on in Cornwall a few months ago, but if we are 5th on whatever measure that is, well my argument is even stronger!
In my role I attend lots of community meetings with various charities, groups etc. All are worried about those on UC and low incomes. Food banks are struggling with demand already, mental health charities are seeing increased demand, many of these new referrals are farmers. We've seen a huge demand for our financial literacy courses.
It is going to be horrific for many people over the coming months possibly years. Increased repossessions, increased suicide, increase in mental health referrals. Strain on public services as a result. I work in East Devon with relatively low levels of economic deprivation, so would hate to think about other areas with higher levels of deprivation.
I am getting twitchy, I'm on the average wage, wife on maternity but her savings will run out quickly with increased costs. So will have to go back to work earlier than she wanted. Belts have been tightened already in preparation.
I suspect the impact won't just be confined to the poorer in society either. The impact will likely be bigger in them though.
But there have to be a lot of people with massive mortgages and outgoings who don't have the headroom for big increases in bills.
It's going to be shit for way too many people
It's "really grim" for MP's on 82k according to some Tory idiot. Seriously who votes for these ****s?
He said this
‘I take the view that being an MP is the greatest honour you could have
Which makes him a ginormous weapon of the first order anyway. But what a dick.
And that £82k is before they add on all their expenses eg travel to/from constituency etc.
https://www.parliament.uk/about/mps-and-lords/members/pay-mps/
It’s “really grim” for MP’s on 82k according to some Tory idiot.
Our poor MP has to commute over 120 miles each way to visit her constituency (and then needs a local guide & interpreter to navigate somewhere she has barely been to and understand the local accent). It must be hell for her, it's not like they get expenses or anything....
My daughter starts nursery next month, costing £1300/month. This feels like poor timing…
Probably is poor timing, but if you can afford to pay 15,000 pa, (after tax) for nursery place for one, you'll be fine. (Of course I know nothing about your situation)
It’s “really grim” for MP’s on 82k according to some Tory idiot.
Odd how it's grim for an MP on £82k but fine for someone on UC to have a £20/week cut from £90 to £70!
My daughter starts nursery next month, costing £1300/month. This feels like poor timing…
Jesus, we paid £900 a month for a couple of years and it nearly killed me. Obvs you'll be wanted to max out any childcare voucher scheme you can use!
I remember the day my Daughter started full-time school, I thought to myself "£900 a month saved, I could lease a Porsche for that!" never works out that way does it? ha ha.
My daughter starts nursery next month, costing £1300/month. This feels like poor timing…
and people wonder why birth rates are falling.
Chatting to people at work who come back part time after having a child, they basically work for free, all their wages go on child care; they just come back for the social / career aspect.
but if you can afford to pay 15,000 pa, (after tax) for nursery place for one
My other half effectively paid to work for years.
What people have to pay, and what they can afford to pay, aren't the same thing.
A key thing to remember when talking about the year ahead... many people will keep paying rent, energy bills, commuting costs, child care... if the alternative is unemployment and still having outgoings they can't afford. And if they choose to give up a job that doesn't pay the way, and can't get into one that would, they'll be labelled a lazy and get caught up in increasingly punitive benefits system if single or their other is on low pay.
Chatting to people at work who come back part time after having a child, they basically work for free, all their wages go on child care; they just come back for the social / career aspect.
Back when we were pre school ( 46 years ago ) , there were a group of 4 of us who's mothers all worked ( apparently quite unusual back then ). They took it in turns to look after us during the week, each taking a day off to do so. Boom, free childcare...
Are there any legal implications doing this in todays world ?
No, but you'd all need to be working part time. Suddenly "free" becomes... "on a reduced income".
apparently quite unusual back then
Yep, when I was a kid, most of my peer groups mums were all full time houswives (or whatever the phrase was back in the 70s), but then you could have a 'good' life on one wage back then.
Yep, when I was a kid, most of my peer groups mums were all full time houswives (or whatever the phrase was back in the 70s), but then you could have a ‘good’ life on one wage back then.
I read about the social economic impact of two-income families becoming the norm a couple of years ago. It wasn't kind.
It started with good intentions, Women, quite rightly, wanted more independence from their husbands. Having their own job and then career, meant they no longer needed to ask for 'pin money' for the things they wanted, plus it allowed them to extend their social circle beyond their neighbours and extended families.
The unintended consequences were less favourable though, two income families did as much for house price inflation in the 80s as right-to-buy did, in fact inflation as a whole. Things quickly evolved from "we've got a much better 'lifestyle' because Mum's got a job" to pretty much every family needing two incomes to be able to rent, let alone buy a family sized house. Also, as we know, being a housewife/husband/full time parent is hard work, and that work doesn't all go away just because the house is empty all day.
The unintended consequences were less favourable though, two income families did as much for house price inflation in the 80s as right-to-buy did, in fact inflation as a whole. Things quickly evolved from “we’ve got a much better ‘lifestyle’ because Mum’s got a job” to pretty much every family needing two incomes to be able to rent, let alone buy a family sized house. Also, as we know, being a housewife/husband/full time parent is hard work, and that work doesn’t all go away just because the house is empty all day.
As a child of the 70s/80s that's always been my thought as well. We relocated to the Midlands for a smaller mortgage so we wouldn't both have to work full time around the kids, and we've still "done without" a lot of things friends seemed to expect as normal to make it work. Currently me who is the part timer.
When I was at primary school in the 80s I was in a class of 13, none of those mothers worked. There were a few with working mothers in my class of around 30 at secondary school in the 90s but that was unusual and I think all part time.
.
The unintended consequences were less favourable though, two income families did as much for house price inflation in the 80s as right-to-buy did, in fact inflation as a whole. Things quickly evolved from “we’ve got a much better ‘lifestyle’ because Mum’s got a job” to pretty much every family needing two incomes to be able to rent, let alone buy a family sized house. Also, as we know, being a housewife/husband/full time parent is hard work, and that work doesn’t all go away just because the house is empty all day.
That is a big problem. Two incomes are now, in a lot of cases, a necessity. Unless we collectively agree to go to back to single earner households and make the price of houses plummet I can't think of a way out of this
I work in construction & it's gone mental, material prices through the roof & an apparent shortage of good staff. I just don't see how it's going to be sustained into next year, some materials have risen 50% in 6 months and yet clients are still gobbling it up as they need projects completed. I don't get where the money is coming from, considering how the reduced appetite for leased/rented office space in city centres will affect some companies.
Is that residential or commercial?
I work in construction & it’s gone mental, material prices through the roof
This is mainly the problem of restarting the global economy from cold, a lot of it will iron itself out and it will return back to normal eg there is no shortage of trees for wood etc, it's just containers / ships are in the wrong places at the moment.
I don’t get where the money is coming from, considering how the reduced appetite for leased/rented office space in city centres will affect some companies.
All that government borrowing to pay for the pandamic is matched by an almost equivalent amount of savings by individuals which is looking for a return...
https://libertystreeteconomics.newyorkfed.org/2021/04/excess-savings-are-not-excessive/
Belts have been tightened already in preparation.
Just yesterday I cancelled a Patreon sub, a monthly beer sub and cancelled a bit of the telly package that we don't really use much, all of it's about £40.00 in total. Not massive but over a year...It all adds up. I doubt we're the only people in the country doing it.
'Richest countries in the world' is meaningless without considering eg population size and the distribution of income and wealth. India is a 'rich' country but you'll never see more 'street life' anywhere.
Ref Nursery...
Jr turned 3 in August and thus we now get the 'free' 30 hours. Firstly, dont be fooled by that, its not free, and its only during term time. You still have (optional technically, but not realistically) to fund the food, trips, extras etc.
Given that he goes 3 days a week, my bill when averaged out has gone from about £600p/m to about £280p/m. Obviously I am using the maximum allowance I can in terms of tax free vouchers etc.
I just thought that was worth noting, as its often quoted that 'its free when they turn three' but its really not. Another year till he joins reception and it'll drop again.
I'd pay it all again in a hearbeat as A) its superb, I cannot possibly imagine why even the wealthiest family with live-in 24/7 nanny wouldn't still send their child to a Nursery, its so good for them, and B) it allows my partner to work part time, because as well as a Mother shes also a person in her own right and deserves a career and all it brings. Financially in the short term theres not a lot in it - but long term a bigger difference.
‘Richest countries in the world’ is meaningless without considering eg population size and the distribution of income and wealth. India is a ‘rich’ country but you’ll never see more ‘street life’ anywhere.
GDP per capita is usually the benchmark, but that is often skewed when you have massive inequality like you see in the US, India and of course the UK (although we're some why behind).
For example, the UK is the 6th richest country in the world by GDP.
But because of our relatively large population, we're the 26th richest by GDP per capita.
We're 10th in the table by the measure of GDP PPP (which considers cost of living, effectively the 'power' of money in the UK.
When it comes to inequality, there is a measure called HDI, or Human Development Index, it not only considered GDP PPP which should give a indication of level of lifestyle, but also considers education levels and life expectancy. It's far from perfect, our wonderful NHS at least allows most of us to lead long healthy lives, and there's now a legal requirement for every under 18 to be educated in some way shape or other. We're 13th in the world and that measure is probably the most interesting to me. Rather than giving an indication of how many people in a country could possibly become rich, or indeed how rich, it gives a better idea of how good that country is for average people. Norway, which despite a huge oil industry rarely bothers the top ten of most economic table, but is number 1 in HDI.
Chatting to people at work who come back part time after having a child, they basically work for free, all their wages go on child care; they just come back for the social / career aspect.
Are nursary fees that much more down in England. Other halfs a teacher which while "well" paid hardly ground braking and has gone back part time.
It's not nearly working for free. But then potentially nursary fees up here are much less ??? £750/month less tax.
But still like most I can't wait till she turns three for the "free" hours. Should just about cover the increase in NI and utility's
We did have a JDE admin at work who was ok after baby 1. But baby 2 tipped it in favour of not working at all. Even with the wife as a teacher I can see that -and it only gets worse with each kid more.
I m guessing nursery fees and care homes charge what they can get away with. Full nursing care home in Surrey is 84k pa, nw England 30k pa. Very similar levels of care too, the room in Surrey was a bit nicer but not by much.
Did they pay all the staff the same? Is the building of the same value (so mortgage or rent the same cost)?
I m guessing nursery fees and care homes charge what they can get away with.
Aren't they supposed to take state vouchers at a prescribed rate.
IIRC Neither of which (nursery vouchers or council care home rates) actually cover the cost of providing the service, so they have cross subsidise it with higher rates from those who pay cash.
The number of staff per child etc I assume is regulated as is minimum wage, so their staff costs are pretty much fixed by regulation.
y I cancelled a Patreon sub, a monthly beer sub and cancelled a bit of the telly package that we don’t really use much, all of it’s about £40.00 in total. Not
That will cover the spring energy cap increase. A £400 increase on top of current increases likely in spring according to Radio Scotland today.
I'll be coming off a 1 year fix in March. Expect my Bill's to go up £60 a month.
Pity the UK gas fracking was strangled at birth by over regulation. Pity we have little storage. Depending other countries for basics like fas and electricity is a bad idea when there is an alternative.
I'll do a bit of overtime if I need to for the higher hills. Not an option for everyone though.
Pity we have little storage.
That's the main issue, this is just a short term spike in demand which large storage would help smoothe out.
As for fracking, have you seen the mess it leaves all over the USA, polluted water tables etc? I'd rather pay more for gas and at least have clean drinking water....
Firstly, dont be fooled by that, its not free,its paid for by the tax payer and its only during term time
FTFY.
It annoys me when politicians describe things as 'free', the words tax-payer funded are much more accurate. Someone, somewhere is paying for it all.
On the subject of child care costs, this just popped up in my FB feed....
Doesn't have the UK in it, but interesting all the same:
[url= https://live.staticflickr.com/65535/51562176439_411afa9ac0.jp g" target="_blank">https://live.staticflickr.com/65535/51562176439_411afa9ac0.jp g"/> [/img][/url][url= https://flic.kr/p/2mynCE4 ]Capture[/url] by [url= https://www.flickr.com/photos/brf/ ]Ben Freeman[/url], on Flickr
https://www.nytimes.com/2021/10/06/upshot/child-care-biden.html
Pity we have little storage.
Gas storage is key... but in the UK we twiddle with the market in the hope that it will result in storage being kept/increased... which hasn't worked out well, has it? Other countries take other approaches.
Firstly, dont be fooled by that, its not free,its paid for by the tax payer and its only during term time
I have some close contacts in the childcare business. its a loss leader for the nursery as well. the rates paid by the LA don't come close to covering the costs. I believe you aren't allowed to turn down a request for free hours but every 'free' hour costs the nursery. if they are lucky, there are add on hours etc that they can charge for to recoup some of the loss. its not a great business to be in.