Grandparents Providing Childcare - Should You be Paying?

April 02, 2021


Grandparents can play a very special role in young children’s lives. They usually dote on their grandchildren, have vast life experience to share, and can be another trusted and invested adult in a young person’s life. Spending time with grandchildren is also beneficial for grandparents, as it keeps them connected to their families and the younger generation, and has a positive impact on their mental and physical health; studies have shown that grandparents caring for grandchildren reduces the onset of cognitive decline, boosts self-esteem and decreases the risk of depression and mental health problems.

Grandparents providing childcare

Fostering relationships with grandparents is important for all these reasons, and also because grandparents’ providing day care for grandchildren can be a successful childcare option for families.  Parents feel secure having their child looked after by a trusted, loving family member, and with the costs of childcare often a burden for young families, this can be an affordable alternative.

In an ideal world, all capable and willing grandparents would be subsidised by the government to care for their grandchildren, as it is a cost-effective and mutually beneficial agreement. However, while the government does have a scheme for paying grandparents for childcare, certain criteria must be met; for example, to receive Family Tax Benefit, the grandparent must care for the child at least 35% of the time, and to receive Childcare Subsidy Additional Grandparent, they must have at least 65% care of the child. It’s worth looking at whether this would be an option for your family, which you can do through government websites, or by contacting Centrelink’s Grandparent Advisors who are available to assist with determining eligibility for government support. 

So, should you be paying?

If grandparents providing daycare for grandchildren aren’t eligible for government financial assistance, the question arises - should you be paying them? The decision is very personal and will differ from family to family, but there are certain elements you can consider in regard to your unique circumstances.

While most grandparents would happily look after their grandchildren free of charge, this is not always an option if the time with grandchildren is impacting them financially. Your parent’s financial situation, and your own financial situation, will determine whether payment is viable; if you have a partner and both contribute to a substantial income it would be fair to offer payment, as presumably, you would have been paying for childcare services anyway.

On the other hand, if the arrangement is necessary to avoid childcare fees, or your parents don’t wish to be paid, it’s still possible to show your appreciation in other ways: helping with tasks they may need done around their home, gifting their favourite food or drink, and asking what they would like assistance with. While looking after children is incredibly rewarding, as all parents know it’s hard work! And grandparents should know how valued they are in the family, and as a care provider for your child.  

Setting up the arrangement

Although it’s sometimes difficult to have these conversations, it is important that everyone is on the same page when entering a grandparent childcare agreement. Having an open and honest discussion about what you need, what and if you’re prepared to pay, and finding out exactly what your parents are able to offer is vital for an ongoing positive arrangement. You may also be surprised at how having this conversation could lead to compromises that work for both parties, or solutions you hadn’t thought of.  

Here are questions to consider when deciding whether you should be paying grandparents for childcare, and having these discussions:

  • The reason grandparents are providing childcare - financial, social, or for convenience?
  • If you would have been putting your child in childcare, how much would you be paying?
  • How will it impact the grandparent’s life, financially or otherwise?
  • Regardless of other payment, will you cover food, petrol and childcare activity expenses?
  • Where do you want your child cared for in your home, or at their grandparents’ house?

Your relationship with your parents is important, as is your child’s relationship with their grandparent, so make sure that you’re setting things up in a loving, respectful and achievable way to protect these relationships going forwards.

Whether or not you end up paying grandparents for childcare, grandchildren and grandparents spending time together is special and beneficial for both, so utilise their support where possible - and find a way that works for everyone to show your appreciation. Splitting time between grandparents and a child care provider may be the solution that works for everyone.

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Toddle is the most comprehensive child care finder in Australia, on a mission to make parents’ lives easier.