{"id":2485,"date":"2015-12-21T00:00:00","date_gmt":"2015-12-21T00:00:00","guid":{"rendered":"https:\/\/qa.simplifimoney.com\/blog\/child-care-costs-vs-income\/"},"modified":"2024-11-18T10:24:30","modified_gmt":"2024-11-18T18:24:30","slug":"child-care-costs-vs-income","status":"publish","type":"post","link":"https:\/\/www.quicken.com\/blog\/child-care-costs-vs-income\/","title":{"rendered":"Child Care Costs vs. Income"},"content":{"rendered":"\n<p>The decision to work or stay at home with the kids has become increasingly complex for families due to the realities of today&#8217;s economy. In some cases, the cost of child care not only outweighs the income provided by a second job, but it&#8217;s also a <a href=\"https:\/\/quicken.intuit.com\/support\/help\/budgeting-basics\/personal-finance-101--what-qualifies-as-disposable-household-income--\/INF24199.html\">household&#8217;s<\/a> largest single expense. It can cost the average family more than college tuition or even housing. Here&#8217;s a look at the current state of child care costs and how to manage them.<\/p>\n\n\n\n<p><strong>The Costs of Child Care<\/strong><\/p>\n\n\n\n<p>A 2015 study reports that the average family pays $18,000 annually for child care in the U.S. Depending on the level of care and using two children as an example, 2015 weekly daycare costs look like this:&nbsp;<\/p>\n\n\n\n<ul class=\"wp-block-list\"><li>Nannies \u2014 $488 per week<\/li><li>Au pair \u2014 $360 per week<\/li><li>Daycare centers \u2014 $341 per week<\/li><li>Family daycare \u2014 $267 per week<\/li><li>After-school sitters \u2014 $197 per week<br>\n\t&nbsp;<\/li><\/ul>\n\n\n\n<p><strong>Budget Guidelines for Daycare<\/strong><\/p>\n\n\n\n<p>The U.S. Department of Health and Human Services advises that daycare should amount to no more than 10 percent of a household&#8217;s budget. By that calculation, a family would need to earn more than $175,000 annually to afford two children in a daycare center at 2015 average costs.&nbsp;<\/p>\n\n\n\n<p>Comparing child care to rent costs reveals a widening gap, such as in Binghamton, NY, where full-time daycare can cost three times as much as what a family pays in rent. Many advisers use 35 percent of income as the budget target for housing costs.<\/p>\n\n\n\n<p><strong>The Impact of High Child Care Costs<\/strong><\/p>\n\n\n\n<p>Stay-at-home parenting can be an economically sound strategy when a second job doesn&#8217;t bring in much extra income, but it does have its downsides. A woman can expect to lose about 10 percent of her earning potential for each year she&#8217;s out of the job market.<\/p>\n\n\n\n<p>Couples report tightening their <a href=\"https:\/\/quicken.intuit.com\/support\/help\/money-and-family\/how-to-budget-for-your-first-child\/INF26318.html\">budgets<\/a> and going into debt to cover child care costs, and day care arrangements at work cause many employees to change jobs due to daycare decisions.<\/p>\n\n\n\n<p><strong>Strategies for Coping with Daycare Costs<\/strong><\/p>\n\n\n\n<p>Even if you\u2019re not one of the 28 percent of families that pay more than $20,000 on childcare annually, there are ways to plan, save and budget for the childcare years.<\/p>\n\n\n\n<ul class=\"wp-block-list\"><li>If your workplace administers a Flexible Spending Account (FSA) program, you can invest up to $5,000 per family annually. Also called a &#8220;dependent account,&#8221; it could result in <a href=\"https:\/\/quicken.intuit.com\/support\/help\/tax-features\/how-do-i-track-estimated-tax-credits\/HOW23271.html\">tax savings<\/a> of $2,000 and could cover over one-third of the annual daycare costs for two children.<\/li><li>There is also tax relief available through Form 2441, the Child and Dependent Care tax credit. You can itemize childcare costs up to $3,000 per child \u2014 creating up to a maximum of $1,200 in tax savings.<\/li><li>State daycare assistance varies, with different levels of care and payment arrangements. Nevada for instance, counts family members as qualifying daycare and may subsidize payment.<\/li><li>Some employers provide additional childcare assistance. Check with your employer to see if you qualify for benefits or assistance.<\/li><\/ul>\n","protected":false},"excerpt":{"rendered":"<p>The decision to work or stay at home with the kids has become increasingly complex for families due to the realities of today&#8217;s economy. In some cases, the cost of child care not only outweighs the income provided by a second job, but it&#8217;s also a  largest single expense. It can cost the average family more than college tuition or even housing. Here&#8217;s a look at the current state of child care costs and how to manage them.<\/p>\n","protected":false},"author":59,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"_seopress_robots_primary_cat":"","_seopress_titles_title":"Child Care Costs vs. Income | Quicken","_seopress_titles_desc":"The decision to work or stay at home with the kids has become increasingly complex for families due to the realities of today&#039;s economy. In some cases, the cost of child care not only outweighs the income provided by a second job, but it&#039;s also a household&#039;s largest single expense. It can cost the average family more than college tuition or even housing. Here&#039;s a look at the current state of child care costs and how to manage them.","_seopress_robots_index":"","inline_featured_image":false,"footnotes":""},"categories":[78],"tags":[],"class_list":["post-2485","post","type-post","status-publish","format-standard","hentry","category-family-relationships"],"acf":[],"jetpack_featured_media_url":"","_links":{"self":[{"href":"https:\/\/www.quicken.com\/blog\/wp-json\/wp\/v2\/posts\/2485","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.quicken.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.quicken.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.quicken.com\/blog\/wp-json\/wp\/v2\/users\/59"}],"replies":[{"embeddable":true,"href":"https:\/\/www.quicken.com\/blog\/wp-json\/wp\/v2\/comments?post=2485"}],"version-history":[{"count":2,"href":"https:\/\/www.quicken.com\/blog\/wp-json\/wp\/v2\/posts\/2485\/revisions"}],"predecessor-version":[{"id":4825,"href":"https:\/\/www.quicken.com\/blog\/wp-json\/wp\/v2\/posts\/2485\/revisions\/4825"}],"wp:attachment":[{"href":"https:\/\/www.quicken.com\/blog\/wp-json\/wp\/v2\/media?parent=2485"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.quicken.com\/blog\/wp-json\/wp\/v2\/categories?post=2485"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.quicken.com\/blog\/wp-json\/wp\/v2\/tags?post=2485"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}