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Fostering: myths and the cost of living crisis

We know that times are tough, but you will be key in making a lasting and positive impact on those who need it most. Find out how FCA helps our foster parents.

February 23 2023 - 4 min read

There is no doubt that the cost of living crisis is affecting the majority of people in the UK. How long will the cost of living crisis last? No one can know for sure, but one thing for certain is that the crisis is putting a lot of extra pressure on the fostering system.

And with people worrying about how they can afford to pay the bills, fostering might seem like an impossible career path. However, along with excellent rewards and generous allowances, fostering vulnerable children and offering them a secure and loving home could be the answer you’re looking for.

Why is there a cost of living crisis?

From the price of petrol to the price of butter. From rising energy costs to the rising prices of food in supermarkets, the cost of living crisis has hit and hit hard.

But, what has caused the cost of living crisis? The cost of living crisis has been fundamentally caused by higher inflation combined with low wage growth. The result? Many households have been left worse off and struggling to pay their monthly bills. The crisis has been made worse by factors such as the war in Ukraine, Brexit, the depreciation in the value of the Pound, and the covid pandemic, which saw inflation fall as we all cut back on our spending…there was nowhere to go and nothing to do.

Has the cost of living impacted fostering?

With the rising cost of living and uncertainties facing us, foster care during the pandemic also took a big hit, with more vulnerable children than ever needing safe and secure homes, and fewer potential foster carers making enquiries to help.

But, the bottom line is, when you become a foster parent, not only will you be making a huge difference in a child’s life, but you’ll also be starting on a brand new career path that pays well and rewards you generously. Helping you earn a great salary in a rewarding and challenging new career, easing the financial burden of the cost of living crisis and beyond.

Can I work and foster?

Can You Aford to Foster?

We know that the main motivation for foster parents is to help children thrive. We also know that this takes a lot of hard work and commitment, as well as money – for food, clothes, entertainment and the little treats that make a big difference.

We support you at every step and this includes making sure that you are fairly recompensed. Money matters, and that’s why we give you generous payments and allowances to help meet the costs of caring for a child and to recognise your professionalism and expertise.

Not only will you be making a difference that lasts a lifetime to one of the thousands of vulnerable children that come into care each year, you’ll receive a generous, usually tax-free financial support package that leaves you free to focus on what matters…family.

What’s more, we regularly review the fees that we pay to foster families and make every effort to take in to account the rising cost of living and impact of inflation, as well as paying our existing bonuses and benefits.

Our fostering allowances and rewards are generous because we believe foster parents should be rewarded for all their hard work and dedication to changing young lives.

There isn’t a set fostering fee, as the exact amount will vary depending on the number of children you foster, the needs of the child, the type of fostering you choose (for example parent and child fostering tends to pay more), and where you live. On average though, you could earn approximately £435 per child, per week.


On top of your fostering allowance, you will also receive:

  • Up to 14 nights of paid respite
  • Two bonus payments each year of £250 in summer and £250 in winter
  • Fostering milestone gifts
  • An annual appreciation bonus from £150 up to £1,000 depending on length of service with us.

We also have an amazing reward platform where you can get discounts from your favourite high street retailers, helping ease your financial worries even more.

Do foster parents pay council tax and other taxes?

A question we hear a lot is “do foster parents pay tax?” When you become a foster parent, you become self-employed, which entitles you to significant tax relief for each foster child in your care. You could be entitled to an income tax exemption up to a certain amount for your fostering. This ensures you’re not taxed on your costs incurred through fostering.

Even if the thought of completing your own tax return feels daunting, don’t worry. FCA provides you with all the information you need, and Foster Talk (where you’ll have free membership) even offer a discounted service to do all the paperwork for you.

What benefits can foster carers claim?

As a self-employed foster parent, you’ll still be eligible to claim most state benefits. You can continue to claim child benefits for your own children as well as means-tested benefits (also known as non-contributory benefits). These include:

  • Income support
  • Working tax credit
  • Carers allowance
  • Housing and council tax benefit
  • Child tax credit
  • Jobseeker’s allowance

As well as these non-means-tested benefits:

  • Attendance allowance
  • Personal independence payment
  • Disability living allowance
  • Universal credits

With all of the above, whether or not you are eligible to receive these benefits depends on your personal circumstances. If you are in any doubt or would like more information, just give us a call.

Do foster parents pay national insurance?

When you become a foster parent, you will be eligible for National Insurance credits. These count towards the basic and state pension and enable your entitlement to the basic state pension, maternity allowance, bereavement benefits, as well as employment and support allowance.

Whether you have to pay National Insurance depends on your personal situation. If, for example, your taxable income is less than your qualifying care relief amount, then your profits are deemed null from fostering. This means you don’t have to pay National Insurance.

Start an amazing new career by becoming a foster parent

If you would like to find out more about the different types of foster care placements, from short and long-term fostering to parent and child fostering, then we would love to hear from you. We know that times are tough, but embarking on a new career in fostering can not only help with your finances, but you will be key in making a lasting and positive impact on those who need it most.

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