Childcare in the U.S. costs on average about $1,230. Your total expenses will hinge on where you live, the frequency of care needed, and the number of children you’re enrolling. Here are six strategic techniques to manage childcare expenses.
Whilst the price for some families may reach $500 weekly or more, it sums up considerably over time. Parents commonly find themselves re-thinking whether it’s profitable to remain a dual-income household or how to afford childcare costs.
If your objective is to curtail your childcare expenditures, the silver lining is, numerous options are available if you’re prepared to play around with adaptability and creativity. Here are six practical techniques to manage childcare expenses.
1. EXPLORE PRIVATE CHILDCARE
Daycare facilities are a handy option, but they’re often the costliest. Many operate at a national level, leaving little to no room for negotiating charges. Therefore, look into private childcare instead—it could be an experienced babysitter or a smaller licensed home daycare provider.
Check out sites like Care.com or SitterCity to find local childcare providers. The advantage of private childcare is there’s room for negotiation, as providers independently set their rates. This doesn’t imply compromising your child’s safety or the standard of care as many smaller daycare centers and private providers are licensed, insured, and highly commended. Remember to verify reviews.
2. APPLY FOR SCHOLARSHIPS AND DISCOUNTS
Another way to minimize childcare costs is by applying for scholarships and discounts when they’re available. For seasonal child care or local park district participation, some centers or organisations like the YMCA offer scholarships. Eligibility generally depends on income brackets, so if you meet the specifications, consider applying. Other daycare options provide discounts, particularly for enrolling multiple children. Additionally, try negotiating childcare rates by proposing a service or volunteering to assist with the other kids occasionally.
3. DISCUSS A HYBRID WORK SCHEDULE WITH YOUR EMPLOYER
High childcare costs are largely due to state labor laws, real estate overheads, plus employee benefits and salaries. To mitigate these costs, some employers may be open to granting you a flexible schedule. Propose a hybrid schedule that allows you to partially work from home. Alternately, your job may permit flexible shifts enabling you to coordinate with your partner. A blend of office and work-from-home can contribute to significant savings on childcare by avoiding a fixed weekly rate.
4. CALL ON FAMILY AND FRIENDS
If you live close to family members prepared to babysit, don’t hesitate to accept their assistance. They may even offer their services for free. Utilizing a loved one for infant care can substantially slash your costs since this age group is the most expensive. You can also negotiate a payment with friends or family members who are able to help. Remember, these rates will be much lower than conventional daycare centers.
You can also consider exchanging childcare services with friends who have children to further cut costs.
5. CONSIDER A DEPENDENT CARE FLEXIBLE SPENDING ACCOUNT (DCFSA) OR CREDIT
A DCFSA is a pre-tax payroll deduction account that can be used to pay for care of dependents under the age of 13. These include expenses like childcare, nursery school, and preschool. The contributions to this account are income tax-free and it’s a great way to save for childcare if you plan on expanding your family.
Alternatively, look into the Child and Dependent Care tax credit – if you have a child under 13 and pay for childcare to work, you may be eligible. Consult a tax professional to see if you qualify. The funds from this credit can be used to offset childcare costs.
6. SET A BUDGET FOR CHILDCARE
Creating a budget for childcare can help determine your affordability. Compare local childcare costs and discuss the pros and cons of your options – including daycare center, licensed home daycare, friends, family, or a babysitter – with your partner.
Review your regular monthly expenses to find areas that can be reduced or removed to improve affordability. Sometimes, this may involve temporary cuts like eating out less or canceling subscriptions. Be realistic about your goals and what you can truly afford.
SUMMARY: APPLY THESE STRATEGIES TO MANAGE CHILDCARE EXPENSES
Childcare can be a hefty expenditure regardless. It’s vital to scrutinize your options in-depth and consider trimming expenses or negotiating a more adaptable work schedule. Future family plans demand childcare discussions and savings soonest.
