Raising a family is expensive. Even for those who plan financially before becoming parents, their financial situation can quickly change once they have children. For many parents, childcare makes up a significant portion of their monthly budget, and costs continue to rise yearly.
If you're looking for affordable childcare solutions in your area or are planning to start a family soon, you may wonder what to expect regarding average childcare costs. It may be much more than you realize. Find out how much money American families are spending on daycare.
On average, Americans spend $321 per week on daycare
Childcare costs have continued to rise in the United States, according to the Care.com 2024 Cost of Care Report. Many families rely on their income and savings to cover this important expense. Finding affordable solutions can be a struggle, and waitlists are often long.
According to the study, 47% of families spent over $1,500 on monthly childcare costs in 2023. But costs varied depending on the type of childcare, and 49% plan to spend the same amount in 2024. How much did families spend on average to send their children to daycare last year?
The national average weekly spend for daycare costs in 2023 was $321, an increase of 13% from $284 in 2022. That's nearly $1,300 a month spent on daycare. The average cost of daycare varies geographically, with some families paying more or less.
In Washington, D.C., parents spent an average of $419 per week on infant daycare costs. Meanwhile, the average weekly infant daycare cost in Arkansas was $129. But unfortunately, not every family has the ability to move to save money.
Some parents have been forced to make significant lifestyle changes because of high childcare costs. Here are some notable statistics related to such changes that parents have made:
- 28% are working more jobs
- 27% have reduced their hours at work
- 17% are exiting the workforce
Unsurprisingly, 59% of parents surveyed say childcare access and affordability are among the top three issues impacting their voting choices in the upcoming presidential election.
Four tips to save on childcare expenses
If you're struggling to afford rising childcare costs or are finding it difficult to find quality care for your kids, you're not alone. Here are a few tips that could help you save on childcare costs.
1. Set aside pre-tax dollars into a Dependent Care FSA
Using a Dependent Care Flexible Spending Account (DCFSA) could offer savings. You won't get a discount on childcare costs, but you can save money on your tax bill. You can contribute up to $5,000 to a DCFSA in 2024.
2. Compare alternate childcare solutions
Exploring the cost of different childcare solutions in your community is recommended. In some cases, daycare may be more costly. For example, a babysitter who provides care inside their home may be a more affordable option.
Another way to reduce childcare costs is by sharing a babysitter with another family. Some nannies provide care to multiple children. Splitting the costs with another family could allow you to get quality childcare while keeping more money in your bank account.
4. Consider a career or work schedule change
It might be worthwhile to see if your employer will allow you to work a hybrid schedule instead of fully in-office to cut down on daycare expenses. Another option is to explore remote or freelance work opportunities.
Are you looking for more ways to save money? Check out our free personal finance resources.
