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Coupon Abbreviations
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  • .75/3 = 75 cents off three items
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creating your budget save on child care

As we walk through getting your budget and finances in order many said their biggest expense was child care.  I can see the frustration of child care not even being on most financial guru budget sheets.  There are some ways to reduce costs and even tax savings that you may be missing out on.

One note before we go any further: With this whole section, please keep in mind that I’m a work-at-home mom, homeschooling my kids.  We all are in different walks of life, so please no one jumping up and saying that you should just stay home.  I’ll be the first to admit it’s not for everyone, nor can some families afford to live on one income.  Okay now back to saving money.

The Tax Breaks

The biggest tax break is the Child and Dependant Care Tax Credit.  As long as you and your spouse (or just you if you file single) were working or looking for work you can get a tax credit equal to 35% of the amount you paid for their childcare.  This is up to $3000 for one child or $6000 for multiple children.  There are some rules to know (it’s the government after all) so read up to make sure you qualify.

Another tax break is asking if your employer offers a Dependant Care Flexible Spending account.  You can put money in this account pre-tax each month to help pay for child care expenses.  The money doesn’t even have to stay in the account long, just take it out of paycheck and then pay the daycare with the account.  You can put up to $5,000 per year in the account which would save an average family $500-$750 in taxes.

Daycare Savings Options

Many parents go daycare hunting with the goal of finding the Harvard’s of the daycare world.  You look at features and amenities long before you look at price.  Just because the place has a year waiting list doesn’t mean that it’s going to be the best place for your kids.  You have to start looking the same way you would for a car.  You aren’t going to go and buy the high end luxury model if you don’t have the money, and we don’t need to do the same with daycare.  The average cost of daycare in the US is $972 a month, so lets say you saved and got in under $650 a month.  Over the next 4 years that will cost $31,200 or the price of a new Honda Odyssey.  (If you go right at average it’s $46,650).

To bring down this price first make sure you are focused on price as much as you are focused on amenities.  It’s okay to look at prices first, you aren’t a bad parent… just a savvy one. Now, I am not suggesting you select the cheapest daycare where they put the infants in a dark room so they’ll sleep all day. I’m just suggesting you consider daycares that aren’t top price range. You always want to make sure the daycare you select meets the requirements for your state.

Ask for discounts.  Many offer multiple children, large group (if your work offers a partnership or discount to certain places), you’ll even find discounts for paying in cash or check over a credit card (one in our town offers 3% off).

Barter for discounts.  If your dream daycare is way out of the budget see if you can do part-time work there to help offset the cost.

Look into half-day programs.  This is a little complicated, but some parents use one program for the first half of the day and then at lunch time move their kids to an afternoon daycare.  I’ve seen other parents do this same concept for summer daycare savings moving kids from one vacation Bible school to another.  A half day program runs on average $200 a month.

Church Daycares.  These tend to be cheaper than stand alone programs, mostly because they are usually non-profit.  In my area the average is $600 a month, a of $200 a month over a for-profit company.  They are still fully accredited programs and teachers, and fully licensed.

Look into Co-Ops.  This is perfect for anyone working part time, you can trade childcare hours with other moms (or even just date night trading for a time out without paying a babysitter).  You work Monday and Wednesday, they work Tuesday and Thursday and neither of you has to pay a dime for child care.  Throw in a few other mamas and you could get this going with only one day per week for each of you.

Try Rearranging Your Schedule.  See if you and your husband can work different hours and thereby not need daycare.  This has marriage ramifications though, so make sure you are both cool with the plan.  Or just ask your boss if they might be okay with flexible schedules or working from home a few hours a week.

In Home Daycare.  This is probably the most overlooked option, and the cheapest.  If your neighbor is a stay at home mom of 2 with kids around the ages of your kiddo, just ask.  Would she be up for you paying her $125 a week?  That’s $500 a month she didn’t have and she’s already home.  This is also a great option for after school care.  A good friend of mine took care of an extra kiddo every afternoon till their mom got off for $50 per week.  Keep in mind though,  that one mama can only handle so many kids.

Bring in an Au-Pair.  Who wouldn’t want to travel to foreign countries and take care of kids.  You provide room & board and weekly stipend.  The average weekly cost of an Au-Pair is $361 and most can watch up to 5 children for the same price.  If you have 2+ kids this is a deal over daycare.  Legally they can only work 45 hours a week, but if you work less than that you have a weekend babysitter as well.  One other benefit of an Au-Pair is that you don’t miss work when your kids are sick!

Public School Options. If you have a 4 year old see if your school district offers a K-4 program.  This is offered at the elementary school you are zoned for and is the full school day following the school schedule.  In some cases this program is free to you, though in others you can pay on average $150 a week.  You would still need afterschool care if you work till 5.  After school care is around $45 per week.

Do you have any other ways you save on child care?

Tomorrow we are tackling the medical category.  This is a big one…

    • Lee

      This is my current problem. I’m 33 weeks pregnant and I would nights at the hospital (7p-7a) and my husband works 3p-12a as an unloader. There are no evening/night time day care options in my small area and the very little family we have nearby seem unable to pitch in some help. With the added costs of a new child I know paying $700 for child care is not in the budget, I fear having to ask my father for financial assistance just so that my daughter has someone to watch her during the gab when my husband and I are at work. Any advice?

      • Do you have any friends in the area? I would ask if anyone might be up for you dropping off her off right before you go to work and then letting her sleep there until you get off in the morning. Once she is sleeping through the night anyway :) For the 3 nights you work I know I’d sign up for baby time…

        • Ashley

          Hey Jenny I am a SHM and someone just asked if I would start watching there 7 week old bab. I said yes and now I’m stumped on how much to charge its for about 8 to 9 hr a day for sometimes 3 to 5 days a week. What should I say she works two job and is a new mom and no dad in the picture and I want it to be fair for both of us any ideas? Thanks

          • lj

            Ashley, I believe it may depend some on your area. A friend of mine that did some in home day care in PA, charged anywhere from 35.00-45.00/day. But my MIL only about 22.50/day. I’m in the Upstate and I charged 25.00. And she brought most of her own snacks, lunch, pampers, etc. But I needed the extra money, so I was willing to take a bit less then the going rate. You want it to be worth your time and energy, but I wouldn’t want to overcharge her either. Sounds like she’s in a bit of a tough situation. Maybe see how much daycare costs in your area and make it a bit cheaper, just to help her out a little.

          • lj

            Ashley, I believe it may depend some on your area. A friend of mine that did some in home day care in PA, charged anywhere from 35.00-45.00/day. But my MIL only about 22.50/day. I’m in the Upstate and I charged 25.00. And she brought most of her own snacks, lunch, pampers, etc. But I needed the extra money, so I was willing to take a bit less then the going rate. You want it to be worth your time and energy, but I wouldn’t want to overcharge her either. Sounds like she’s in a bit of a tough situation. Maybe see how much daycare costs in your area and make it a bit cheaper, just to help her out a little.

          • Brooke

            When I went back to work when my daughter was 3 months old, I knew it would have cost $180 wk for infant child care at the Christian daycare. Which was one of the more expensive day cares, but I wanted my daughter somewhere they would read bible stories to her. The daycare did provide formula, but I was nursing so that wasn’t a benefit for me. I decided to pay my in home sitter $40 a day, because I felt she was worth as much and honestly probably more than daycare. She drove to my house each day and my daughter got one on one attention. Thankfully eventually my husband I and worked our schedules out so we don’t need child care. I work 30 hours in 3 days and he works 20 hours the other two days a week. The 10 hour days are long, but we still have our weekends and I love the time with my girls and the adult interaction time at work

          • Naomi

            a good way to find the average rates in your area is by looking at the ads on craigslist

    • lj

      I did in home child care for 2 years. (It’s just too much for me to continue right now) You have it listed as the cheapest option. Using your figures, what I charged was a lot cheaper than daycare. One thing I would like to throw out just as food for thought. While it may be the cheapest, it shouldn’t be. Your child, if in in-home care, gets a whole lot more one-on-one attention than they would in a daycare. Your child will become like part of the family. Honestly, if I was looking for childcare, this would be the first option I’d look at, simply because of the level of care I know my child would receive. When talking about childcare, you are essentially hiring someone to raise your child part time. The child will be with them the majority of their awake time. Do you want to be the one in control of who will be “raising” your child, like what morals will be taught, language picked up, manners, etc? Or do you want to pay a daycare and trust them to hire someone of good character/morals? In my opinion, having my child being cared for in a home I’ve approved of, is worth much more than at a daycare, where I don’t know who is teaching them what. I know that daycare is the ONLY option for some people, and I’m not saying someone is a bad parent for choosing a daycare. I just wanted to bring out that, sometimes it is more expensive to have in-home care, but it may be worth it. Blessings to all the moms out there doing the best they can. Your children are a gift :)

      • Naomi

        well said! The child I watched had come from daycare where the ratio was 1 teacher to 10 two year olds and it took me awhile to get him to speak at a normal level among other things.

        • Susie

          The only problem with in home child care is that I would have to know someone extremely well before I left my child with them. I’m sure both of you were excellent child care providers, but they do exist out there that become different people after mom leaves. The job I had all my life dealt with people all day long, I saw so many shocking ‘sides’ of people that leaving my child with an individual just wasn’t an option for me. Day care has many different people working there and everything is documented for fear of a law suit. I prefer documented. And they didn’t raise my child, just as after they become school age, the school doesn’t raise our children. It’s just a different path we choose for various reasons. It’s great you guys are able to stay home with your kids but for many of us that wasn’t an option.

    • Naomi

      Another way to save on childcare: Staying at home with your kids. There are potential ways to earn money from home as well. I think “stay-at-home” moms get a bad rap sometimes, but it’s so worth it! I don’t have to pay for daycare and I’m saving money on gas to and from work, food because I’m not going out to eat or grabbing something quick in the morning. I’m also gaining invaluable time with my children. I used to watch an extra child, but they moved and I agree with lj that in-home childcare is undervalued. I had their child from 7am-5pm M-F. He only saw his parents for suppertime and an hour or two before bedtime and on the weekends so essentially I was raising him. They ended up moving and I chose not to pursue additional children. Now I crochet hats, scarves, toys, or whatever to earn a little extra income.

      • lj

        It’s funny, but I’ve actually heard a career woman say this same thing! She said she can’t afford to work. Once you have 2-3 little ones to find child care for, it’s too expensive. In addition to the cost of the childcare, she said she had the added expense of extra and nicer-looking clothes for her and the kiddos, the meals out, the extra gas (she even said extra vehicle, meaning they could do it with only one car), extra money for extras the kiddos needed at the daycare, etc. She said that when they added it all up, she was essentially working to pay for childcare! (And missing out on all the special little “firsts” that children have.) But I know this isn’t an option for everyone. And my comments are NOT meant to make anyone feel like this is the ONLY way.

        • Naomi

          that’s what I was saying to. I would lose money by going to work. I had a friend who worked when she had her first, but by the time she had a 2nd, she would have been just breaking even, and when she realized that, she decided to stay home instead. My point was just that some people may not have considered staying home as saving money when you factor in the work expenses.

      • Heidi

        Ummm….I guess you missed the part where Jenny said “We all are in different walks of life, so please no one jumping up and saying that you should just stay home.”

        • Naomi

          I didn’t mean everyone should just stay home. I just meant it’s an option to consider financially because there are additional expenses to consider. It never dawned on me it would be cheaper to stay home until someone pointed it out the expenses I hadn’t considered, like the list lj gave below.

    • Sarah

      Just remember if you are watching someone else’s kids in your home, that is income to you and still taxable. Take that into account when deciding what to charge a friend for in home care you provide.

      • lj

        Yes, that is correct and you also need to check the laws in your state regarding in-home daycare. For example, I believe SC is if you keep more than 2 kids other than your own, you have to be licensed. (If I remember correctly. Or maybe kids from more than 2 different families) I don’t remember all the details… but the point is, make sure you’re following the laws. :)

        • LuisMommy

          In Oklahoma, if you care for ANY children who are not family members for more than 15 hours a week, you must have a license. Getting caught without a license carries a hefty fine, and criminal charges for repeated offenses.

        • lj

          Just looked it up, out of curiosity. SC laws say if you care for children from more than one unrelated family, you must be licensed. So, I guess as long as it’s only for one unrelated family, the amount of kids doesn’t matter. Oh, and in addition to being licensed, you have to have certain inspections, and be certified for CPR, etc.

    • Amie

      I worked in mental health before my husband and I decided to have kids. When we decided we were ready, I decided to switch careers and become a teacher for students with emotional needs. I joined a program to get certification as a teacher, took a pay cut as a new teacher, added in an hour commute each way, started graduate school, and was pregnant. It wasn’t easy, but the sacrifice paid off. Now I have 3 kids, I work 15 minutes from home, our school breaks are on the same schedule, and I work for a program that values family so I can bring my oldest son, he’s in K, to work with me on planning days. My husband rearranged his schedule at work to pick our son up after school. I still have 2 in daycare, but they stay home with me during the summer. People ask me if it would be cheaper to stay at home, but I carry the insurance and make more than my husband, so no it wouldn’t be. My husband isn’t interested in being a stay at home parent. It works for us.

    • Amie

      I worked in mental health before my husband and I decided to have kids. When we decided we were ready, I decided to switch careers and become a teacher for students with emotional needs. I joined a program to get certification as a teacher, took a pay cut as a new teacher, added in an hour commute each way, started graduate school, and was pregnant. It wasn’t easy, but the sacrifice paid off. Now I have 3 kids, I work 15 minutes from home, our school breaks are on the same schedule, and I work for a program that values family so I can bring my oldest son, he’s in K, to work with me on planning days. My husband rearranged his schedule at work to pick our son up after school. I still have 2 in daycare, but they stay home with me during the summer. People ask me if it would be cheaper to stay at home, but I carry the insurance and make more than my husband, so no it wouldn’t be. My husband isn’t interested in being a stay at home parent. It works for us.

    • Carrie

      Another option that no one has mentioned is actually changing careers and becoming a child care teacher or director. Many child care centers offer a child care discount, as much 100%, for your child, plus other benefits such as medical insurance, dental, vision, educational assistance, paid vacation and sick time. I have worked as a child care teacher for 3 years and as an assistant director for 4 years~both my children attend 100% free, and I am finishing up my 4 year degree and will return to the workforce in my new field when my youngest is in first grade.

    • Carrie

      Another option that no one has mentioned is actually changing careers and becoming a child care teacher or director. Many child care centers offer a child care discount, as much 100%, for your child, plus other benefits such as medical insurance, dental, vision, educational assistance, paid vacation and sick time. I have worked as a child care teacher for 3 years and as an assistant director for 4 years~both my children attend 100% free, and I am finishing up my 4 year degree and will return to the workforce in my new field when my youngest is in first grade.

    • bellearwood

      Interesting and informative! These tips are sure to help in cutting the expense down. Finding a cheap yet reliable child care service would also help in cutting down the cost to a certain extent!