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Child Care Costs

December 3rd, 2018 | Written by

Child Care Costs

Referenced on, the average cost of center-based daycare in the United States is $11,666 per year ($972 a month), but prices range from $3,582 to $18,773 a year ($300 to $1,564 monthly), according to the National Association of Child Care Resource and Referral Agencies. Below are some topics that may give insight on money-saving ideas.

Selective Scheduling

Scheduling arrangements such as staggering spousal work schedules or working from home on certain days can help lower the standard five-day weekly cost.

Babysitting Co-ops

Research co-op groups which can be structures in several ways. Some have care offered through a third-party nanny while others structure schedules between parents of the group.

Private Care

Brick and mortar facilities have expenses (utilities, rent/mortgage, payroll) to cover that typically would make their fees more expensive than hiring an individual privately. While hiring a nanny at a discount may be enticing, be aware of legal ramifications. When paying an individual at least $1,800 per year, payroll/tax withholding is required.

Child Care Centers

While this may be one of the most expensive options, there are comparisons that can lower costs. Request a discount, look for discount advertising or free registration periods, or visit neighboring cities with lower fees.

Dependent Care Flexible Spending Accounts

Pre-tax dollars (exempt from Federal/Payroll/some state taxes) for child care expenses can be taken up to $5,000 for married joint or single filers or the reported earned income. Restrictions apply to the use of the funds, such as it may be used for daycare expenses of children under 12 years of age, but not for tuition for those over the age of five. Unused funds are forfeited at the end of the calendar year.

Speak with a financial advisor for additional suggestions. For Flexible Spending Account inquiries, meet with your Human Resources Representative and/or Tax Professional.

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    This information is not intended to be used as the only bases for investment decisions, nor should it be constructed as advice designed to meet your particular needs. You are advised to seek the advice of your financial advisor prior to making any decision based on any specific information contained herein.
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