Helpful Tips for How to Afford Daycare for Your Children

Going to work every day is hard when you have children at home. Parents must weigh the cost of that separation. Generating income is important, but leaving your children takes an emotional toll and creates a significant financial liability. This article will break down the cost of daycare and provide tips on how to afford it. Here are some key concepts covered in this post:

• Understanding the average cost of daycare and related expenses.
• Exploring daycare alternatives that can help save money.
• Practical strategies to reduce daycare costs.
• Available financial assistance programs for childcare.

What is the average cost of daycare?

According to a report by Care.com, the average weekly childcare cost for one infant child is $230 for a family care center, $321 for a daycare center (also referred to as ‘child care centers’), and $766 for a nanny. To put that in perspective, U.S. Census Bureau data puts the median household income for 2025 at $75,580. Do the math.

The costs of running a daycare have also gone up. Providers must pay higher staff salaries, rents, or mortgages on appreciated properties, utilities, supplies, insurance, and licensing fees. Some daycares also offer transportation or specialized programs for special needs children. Those costs are passed on to the parents. As they go up, the price of daycare increases.

Location is also a variable in the cost equation. For instance, the annual cost of daycare in Washington, DC is $24,243. In Virginia, a bordering state, it’s $14,063. These numbers vary further within the states based on the neighborhood where the daycare is located. More affluent communities and locations close to employment opportunities cost more.

Alternatives to daycare and childcare

Parents may need a pay raise to afford a professional daycare provider. Thankfully, there are more affordable alternatives. Asking family members for help tops that list. Many working adults rely on parents, grandparents, aunts, uncles, and cousins to watch their children while they’re on the job. Paying them is appropriate, but not always necessary.

Another option is a concept called “Nanny Shares.” This is an arrangement where several families share the costs of one nanny. Children can benefit from this setup because it puts them in a group where they can develop social skills. The site of the childcare can either rotate periodically or be one central location the nanny can report to each day.

Many companies have introduced hybrid and flexible work schedules to mitigate their employees’ childcare costs. Others have implemented childcare subsidies for working mothers and fathers. The IRS offers an Employer-Provided Childcare Credit to incentivize companies into doing this. Ask your employer if they are familiar with it.

Tips for how to afford daycare

Daycare and nanny services aren’t the only expenses parents need to cover. The general cost of living has been going up steadily every year. Personal loans are more affordable when interest rates come down, but taking on new debt should be a last resort. Research the following options to see if one applies to your situation.

1. Research and apply for childcare assistance programs

Several states have subsidies and credits similar to the federal Child and Dependent Care Credit. Call your state Department of Revenue to ask about these programs. Another option is the Child Care and Development Fund (CCDF). After researching that, ask your bank about Flexible Spending Accounts (FSAs) to cover childcare expenses.

2. Take advantage of employer-sponsored childcare programs

Employers can offer childcare assistance in several ways. Help can be provided with pay raises, food vouchers, gift cards, or paid leave during maternity. Flexible scheduling also helps, particularly if some hours can be worked remotely from home. Your HR department can help you discover which programs are available to fit your needs.

3. Explore ways to reduce daycare costs

There are several ways to reduce the cost of daycare. Look for sibling discounts, sliding scale fees, or state-subsidized programs. Discuss the benefits of choosing in-home daycare over daycare centers. Negotiate rates with providers or consider part-time enrollment. You’re not the only parent struggling with this. Find out what everyone else is doing.

4. Create a budget for childcare expenses

Affordability cannot be determined without comparing your expenses to your income. Create a budget with essential and non-essential expenses listed separately. Childcare goes in the “essential” column. Non-essentials are expenses that can be eliminated to save money. See our article “9 of the Best Budget Apps” if you need help.

5. Consider community and nonprofit childcare options

If you go to church, ask if there’s a faith-based daycare available. Non-profit childcare centers also offer affordable and sometimes even free childcare services. There’s a site called Great Non-Profits that lists several in each state. Other places to look are local city and town halls, community centers, and fraternal organizations like the Elks and Knights of Columbus.

The bottom line

Childcare is expensive, but there are ways to make it more affordable by budgeting your money carefully, asking friends and family for help, and taking advantage of subsidies and tax credits. You may also find resources at your local city or town hall and various online directories for non-profit organizations. You’re not alone. All working parents struggle with childcare costs. For help managing your money, check out our articles on  spending and money management.