A beautiful Hispanic daycare teacher leans on the table and helps a cute blonde little girl with a school project.

6 ways to help make child care more affordable


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Raising children is expensive, and paying for childcare is one of the biggest costs parents have to bear.

“Every year, Americans spend about $42 billion on early care and education, which comes to about $500 a month,” said Andrew Latham, managing editor at SuperMoney.com and a father himself.

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But there are ways to reduce these costs. Here are some tips for making childcare affordable.

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Create a babysitter cooperative

“You can save some money, make new friends, and enjoy nights out even more by setting up a neighborhood babysitter co-op,” Latham said. “These co-ops are based on a points system where you earn points when caring for your neighbor’s children (eg, two points per child per hour) and spend those points when you connect your child.”

Latham recommends the website Sitting Around, which makes it easy to set up a babysitting co-op and manage paperwork.

“Sharing babysitting is a little more complicated with COVID-19, but it can still be done responsibly if you can create ‘bubbles’ with relatives, friends and neighbors,” he added.

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Use a Dependent Care Flex spending account

If you have access to the FSA through your employer, be sure to take advantage of it.

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“You may have heard of healthcare FSAs, but there are also dependent care FSAs that allow you to put pre-tax dollars into an account and then reimburse yourself from that account for whatever your monthly childcare costs,” Scott Sturgeon said. , founder and chief wealth advisor at Oread Wealth Partners. “For high-income earners, this can be very important, as you deduct up to $5,000 from your annual income.”

It is important to note that there are some downsides to this type of account.

“Unfortunately, the only way to access the FSA for dependent care is through work, and again, you are limited to contributing $5,000 per spouse,” Sturgeon said. “You can also just use the money to pay or pay for childcare or dependent care, so if for some reason those expenses go away, you could lose money at the end of the year.”

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Compare your daycare options

If you go the daycare route, be sure to do some comparison shopping before you commit.

“It is important to evaluate things like commute time, course curriculum, health and safety, and cost,” said Gerald Grant III, vice president of G Financial Group, which works in alliance with Equitable Advisors. “When choosing a daycare, you don’t want to just choose the ones closest to your home – you have to do your research to find the best comprehensive daycare in your area. Sometimes the closest can be more expensive and the other farther away may be cheaper. On the other hand, don’t The cost is always cash only, so if you’re spending more time on a longer commute and daycare isn’t better overall, it might make sense to spend a bit more on daycare that costs you less in time.”

Consider a nanny at home

Nannies are usually more expensive than daycare, but depending on the amount of time you will need to take care of the children, it may be cheaper to get help at home.

“Having a nanny at home in some cases can save you time, and the overall and structural cost may be better for you and your family than a traditional daycare,” Grant said.

Take advantage of employee benefits

Some employers offer help with childcare needs, so see what’s available to you.

“Many companies have programs to help their employees find affordable child care, fast waiting lists, etc., so it is important to communicate with your employer to find out what programs are available to you,” Grant said. “For example, federal government employees can apply for the Federal Child Care Support Program, which is a pool of funds specifically earmarked to help their employees with the cost of childcare. Many other companies have programs similar to this as well.”

Make the most of your tax credits

“Government tax credits, such as the Child Tax Credit, are designed to reimburse taxpayers for a portion of childcare costs incurred,” Grant said. “Understanding all of the options and benefits available is critical to making sure that your child can receive the most appropriate and affordable child care.”

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About the author

Gabrielle joined GOBankingRates in 2017 and brings with her a decade of experience in the journalism industry. Prior to joining the team, she was a writer and reporter for People Magazine and People.com. Her work has also appeared on E! Online, Us Weekly, Patch, Sweety High, Discover Los Angeles, and has appeared on “Good Morning America” ​​as a celebrity news anchor.

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