What Does Your Child Care Village Cost You? (2024)

_{*Rates for infant children.}

According to the Care.com survey, on average, 67% of families are spending 20% of their annual income on child care. That's up from 51% in 2022. The majority of parents surveyed (59%) said they plan to spend more than $18,000 per child on child care in 2023.

Washington, D.C. leads the country in highest child care costs, whether it's a nanny, daycare center, or a babysitter. Mississippi and West Virginia have some of the lowest child care rates.

While most parents surveyed do budget for these costs, one in five say they expect they will go over that budget by the end of the year. Daycare centers and providers have increased their fees and inflation has also contributed to rising costs.

ChildCare Aware's report offers that the national annual average cost of childcare is $10,174. For married couples, this burden is significant but not as crippling as it is for single parents relying on one income to satisfy this need. Low-income households are also trying to squeeze the most out of every penny.

The Emotional Toll of Securing Child Care

Figuring out child care isn’t just about calculating dollars and cents, it also adds a tremendous scheduling, transportation, and emotional burden for parents. The Care.com study found that “43% of parents say it’s much harder to find child care over the past year.”

Upstate New York mother, Jessica Lucia, described the run-around of securing childcare for “The Motherload.” In the emotional ordeal, she outlines a story that working parents, especially moms, know all too well.

When her son was just two months old, her reliable babysitter got sick. The following two years included everything from generous relatives, Care.com-recommended sitters, and her work’s on-site daycare center as backup child care. She still finds that there are days when she has to work but the center is closed, and that throws her household into a tailspin.

Her experience reads like a patchwork quilt, messy and imperfect, although even she admits that things could have been much worse; she had the benefit of nearby relatives who could help. Many parents bear the stressful burden of trying to make the square peg of child care fit within the round hole of a normal workday. Often, they just don’t fit.

A 2021 survey by the Penny Hoarder found that “four out of 10 parents say they have gone into debt due to the high cost of child care.” Ironically, 38% of parents surveyed had taken on a second job or side hustle, just to pay for child care.

Anecdotally, many stay-at-home parents say that the cost of going to work just isn’t worth it, given the price of child care for non-school-age kids. “In 40 states and the District of Columbia, child care costs for two children exceed the average mortgage cost,” the data says, and that’s enough to make anyone question their entire lives. Over 25% of parents surveyed moved houses to be able to afford the cost of childcare. These are major sacrifices and stressful events for parents trying to make ends meet.

While the pandemic increased work-from-home policies, many employed parents took on the burden of remote schooling too. The immediate reduction in the cost of out-of-home care was met by the stress of trying to do it all. Working moms, in particular, reported that their careers took a serious hit. During the pandemic, a Pew Research Center study found that “among those who have child care responsibilities while working from home, mothers are more likely than fathers to say they have needed to reduce their work hours (50% vs. 30%), have been treated as if they weren’t committed to their work (22% vs. 13%), have been passed over for a promotion (13% vs. 3%) or have turned down a promotion (13% vs. 5%).”

Making Child Care More Affordable

There are many strategies to reduce the cost of child care, but it takes research and diligence. If you have reliable friends or relatives nearby, they are the first line of defense for babysitting help. While some grandparents are happy to do it for free, you’d be surprised to learn that many others would be willing to watch your children for much less than the average cost of enrolling them in formal child care programs. For infant care, in particular, this may be the most cost-effective.

If you can pair up with a neighboring family, you both can babysitter or nanny share. This means you split the cost of joint-child care from one provider. This money-saving option can help your kids interact with other children in a safe home setting. Or the provider can spend half the day or half the week at one home with one family, and the rest of the time with the other. This split schedule allows the provider to make full-time wages with full transparency.

For low-income families, assistance is available to help pay for childcare costs. Childcare.gov helps people find state-specific resources like state-funded pre-kindergarten, head start programs (0-5 years old), and subsidized vouchers or certificates. There are also special programs for Native Alaskan, Hawai’ian, and tribal American Indian communities.

To further reduce the cost of child care, consider paying through a flexible spending account (FSA). Many companies offer employees access to a Dependent Care FSA (DCFSA) that allows them to use pre-tax dollars to pay for child care. Take advantage of any and all employer-provided perks, like on-site daycare or discounts at certain childcare providers. Don’t forget the IRS credits and deductions that can help, like the Child and Dependent Care Credit and the Earned Income Tax Credit.

More Solutions Are Needed

“When it comes to child care, there are three critical criteria—cost, quality and availability—and based on our research findings, we’ve not only failed to make progress as a country, we’ve actually gone backwards,” says Natalie Mayslich, president of consumer for Care.com. Many advocates of the Build Back Better Framework say that free preschool for three and four years, as well as expanding the Child Tax Credit, are urgently needed solutions.

But while Americans wait for relief, there’s both a financial and emotional weight for parents and caregivers. For now, some parents may qualify for Head Start programs. Others have to creatively approach the challenge by maximizing workplace perks—like parental leave, remote work, or work-from-anywhere policies—to eke out some savings. Living near relatives and friends who are available during the workday is particularly beneficial for parents of children under 5 years old, especially non-potty-trained infants and toddlers, but that may come with emotional and mental health trade offs. Parents who can afford it may find that securing live-in care from relatives or even au pairs may turn out to be much more modest than expected, after tallying up the transportation cost for pickups, drop-offs, before- and after-school care.

The Bottom Line

Regardless of their location or income level, American parents are clamoring for more reliable and economical child care solutions that will help them afford the cost of child-rearing day-to-day, without sacrificing long-term goals like owning a home, retirement, and kids’ college funds.