7 steps: How couples and single parents can prepare for child care costs

April 11, 2018

Learn financial and strategic moves to ease the expense and stress on your family.

 

For many parents, juggling work, children and the cost of child care takes a part-time strategist and full-time accountant. Securing affordable child care can be even trickier for single parents.

We’ve outlined the top seven considerations for both couples and single parents when it comes to budgeting for child care costs.

 

1. Make saving a priority

A tight budget can get squeezed even more when day care gets added into the mix. However, try not to let day care costs derail your budget overall. Saving can still be a priority, even if you need to save a little less due to child care costs.

 

2. Use a flex spending account

Luckily, there are some great tax breaks that can make child care costs less expensive. For instance, when paying for day care, use a dependent care flexible spending account (set up through your employer). It allows you to use pretax dollars to pay for qualified out-of-pocket dependent care expenses, potentially leading to significant cost savings.

Or…

 

3. Use available tax credits

… if you don’t have a flex spending option through your employer, think about using the child and dependent care credit. To qualify for the credit, your child care costs must be spent on care needed to let you work or seek work. Keep in mind there is a maximum deduction amount and that other rules apply.

 

4. Comparison shop

When looking for care, consider the costs of preschool versus a nanny or nanny share, and the pros and cons of each. And remember that costs decline as your child ages; infant rooms are the priciest due to teacher-child ratios.

 

5. Consider changing jobs

Also, consider whether a more flexible job might lead to cost savings on child care. If you’re married with young children, can one of you work evenings so a parent is always home? If you’re a single parent, can you shift your hours to accommodate child care?

 

6. Budget for extra expenses

When budgeting for child care, remember that child care is more than just preschool. Include summer day camps, before- and after-school programs and baby sitters when calculating your yearly child care expenses.

Also, if your child is old enough, working from home, even once a week, might help you save.

 

7. Consider other options

Finally, consider if paying for child care makes sense financially. If you’re paying for day care, you might be spending $15,000 a year or more, depending on where you live. That might not be a considerable expense if you and your spouse have well-paying jobs. However, if either of you nets just $30,000 yearly, then half of your take-home pay is funding day care. The number goes up if you have more than one child, of course.

If you love your job, this trade-off might make sense. However, if the person with the lower salary is working just to pay bills, think about that partner staying home, at least until one child is in kindergarten. It can be a tough decision, but it's certainly one worth thinking about.

 

Want to learn more about tackling tough money topics just like this? Explore more articles about personal finance.

Related content

How grandparents can contribute to college funds instead of buying gifts

How to stop living paycheck to paycheck post-pay increase

Do your investments match your financial goals?

Starting your homebuying journey: Tips from a U.S. Bank Goals Coach

Tips and tools for tax season and beyond

5 financial goals for the new year

Money Moments: Tips for selling your home

Parent checklist: Preparing for college

Which is better: Combining bank accounts before marriage — or after?

What are conforming loan limits and why are they increasing

Does your savings plan match your lifestyle?

Don’t underestimate the importance of balancing your checking account

Do you and your fiancé have compatible financial goals?

How to stay financially focused in the face of economic uncertainty

Is it time to get a shared bank account with your partner?

You can take these 18 budgeting tips straight to the bank

Putting home ownership within reach for a diverse workforce

What is an escrow account? Do I have one?

Should you get a home equity loan or a home equity line of credit?

Quiz: How prepared are you to buy a home?

Unexpected retirement expenses

LGBTQ+ financial planning: 7 reasons why it matters

Trust vs. will: What’s the difference?

The connection between your health and financial well-being

Should I itemize my taxes?

Reviewing your beneficiaries: A 5-step guide

Retirement planning strategies for dual-income families

Retirement planning in the gig economy

Retirement income planning: 4 steps to take

LGBTQ+ retirement planning: What you need to know

Key milestone ages as you near and start retirement

Is your employer long term disability insurance enough?

Is a Health Savings Account missing from your retirement plan?

Your 4-step guide to financial planning

Working after retirement: Factors to consider

What to do when you lose your job

Using 529 plans for K-12 tuition

How to retire happy

How to protect your digital assets in your estate plan

How to open and invest in a 529 plan

How much life insurance do I need?

Financial steps to take after the death of a spouse

Can fantasy football make you a better investor?

Insource or outsource? 10 considerations

Investment strategies by age

Investing for beginners

How to prepare for healthcare costs in retirement

Annual insurance review checklist

A guide to tax diversification in investing

8 steps to choosing a health insurance plan

7 ways for pre-retirees to get ready for retirement

7 things to know about long-term care insurance

6 year-end tax planning tips

6 tips on trust fund distributions to beneficiaries

Year-end financial checklist

How to use debt to build wealth

How to track your spending patterns

How to manage your money: 6 steps to take

How to manage your money when you're self-employed

How to discuss money with your family

Good debt vs. bad debt: Know the difference

6 common money mistakes to avoid

5 times you may need a financial advisor

How to establish your business credit score

Key components of a financial plan

4 tips to help you save for retirement in your 20s

4 steps to finding a charity to support

4 reasons estate planning is important

4 financial considerations before changing jobs

3 types of insurance you shouldn’t ignore

How to winterize your vehicle

Unexpected cost savings may be hiding in your payment strategy

Transitioning from the military to the civilian workforce

Checklist: 10 questions to ask your home inspector

5 things to avoid that can devalue your home

Webinar: Common budget mistakes (and how to avoid them)

5 things to consider when deciding to take an unplanned trip

30-day adulting challenge: Financial wellness tasks to complete in a month

5 reasons why couples may have separate bank accounts

7 steps: How couples and single parents can prepare for child care costs

9 simple ways to save

A who’s who at your local bank

Adulting 101: How to make a budget plan

Allowance basics for parents and kids

Are savings bonds still a thing?

Certificates of deposit: How they work to grow your money

Common unexpected expenses and three ways to pay for them

Dear Money Mentor: How do I set and track financial goals?

Finding a side gig to fund your goals

Friction How it can help achieve money goals

Growing your savings by going on a ‘money hunt’

Helpful tips for safe and smart charitable giving

What you need to know about renting

Tips for working in the gig economy

Here’s how to create a budget for yourself

How and when to ask for a raise

How can I help my student manage money?

U.S. Bank asks: Transitioning out of college life? What’s next?

6 pandemic money habits keep for long term

How having savings gives you peace of mind

How I did it: Learned to budget as a single mom

How I kicked my online shopping habit and got my spending under control

How to best handle unexpected expenses

How to decide when to shop local and when to shop online

How to manage money in the military: A veteran weighs in

How to save for a wedding

How to save money while helping the environment

How to set yourself up for success in your first job

How to stay positive when searching for a job: advice from a U.S. Bank goals coach

It's possible: 7 tips for breaking the spending cycle

Money Moments: 3 smart financial strategies when caring for aging parents

Personal finance for teens can empower your child

Personal loans first-timer's guide: 7 questions to ask

Save time and money with automatic bill pay

Stay committed goals creating positive habits

Stay on budget — and on the go — with a mobile banking app

The mobile app to download before summer vacation

Tips to overcome three common savings hurdles

Webinar: Uncover the cost: Wedding

Webinar: Uncover the cost: International trip

What military service taught me about money management

Working with an accountability partner can help you reach your goals

Your guide to starting a job: Resources to help along the way

Building a financial legacy for your family and community

How to increase your savings

It’s time for a fresh start: A new way of thinking

U.S. Bank asks: Do you know what an overdraft is?

U.S. Bank asks: Do you know your finances?

Money Moments: 8 dos and don’ts for saving money in your 30s

Money Moments: How to manage your finances after a divorce

What financial advice would you give your younger self?

Bank from home with these digital features

Money Moments: 3 tips for planning an extended leave of absence

Practical money tips we've learned from our dads

3 awkward situations Zelle can help avoid

What’s in your emergency fund?

Travel for less: Smart (not cheap) ways to spend less on your next trip

Tips to raise financially healthy kids at every age

Money management guide to financial independence

Financial gifts can be a valuable – and fun – choice for the holidays

Understanding guardianship and power of attorney in banking

How I did it: Bought my dream home using equity

Buying a home Q&A: What made three homeowners fall in love with their new home

House Hacks: How buying an investment property worked as my first home

How I did it: Built living spaces to support my family

Spring cleaning checklist for your home: 5 budget-boosting tasks

Saving for a down payment: Where should I keep my money?

Your guide to breaking the rental cycle

Checklist: 6 to-dos for after a move

Webinar: Uncover the cost: Building a home

How I did it: Bought a home without a 20 percent down payment

4 ways to free up your budget (and your life) with a smaller home

Get more home for your money with these tips

Money Moments: How to finance a home addition

How I did it: My house remodel

Are professional movers worth the cost?

Building a dream home that fits your life

10 questions to ask when hiring a contractor

Is it the right time to refinance your mortgage?

10 ways to increase your home’s curb appeal

What is a home equity line of credit (HELOC) and what can it be used for?

Webinar: Uncover the cost: Home renovation

The lowdown on 6 myths about buying a home

Is a home equity line of credit (HELOC) right for you?

10 uses for a home equity loan

Preparing for homeownership: A guide for LGBTQ+ homebuyers

Beyond the mortgage: Other costs for homeowners

How to use your home equity to finance home improvements

What to know when buying a home with your significant other

Dear Money Mentor: When should I refinance a mortgage?

Webinar: Mortgage basics: How much house can you afford?

Webinar: Mortgage basics: Buying or renting – What’s right for you?

Webinar: Mortgage basics: What is refinancing, and is it right for you?

Webinar: Mortgage basics: Prequalification or pre-approval – What do I need?

Webinar: Mortgage basics: How does your credit score impact the homebuying experience?

Webinar: Mortgage basics: Finding the right home loan for you

Webinar: Mortgage basics: 3 Key steps in the homebuying process

8 steps to take before you buy a home

These small home improvement projects offer big returns on investment

What is refinancing a mortgage?

How do I prequalify for a mortgage?

6 questions to ask before buying a new home

Home equity: Small ways to improve the value of your home

How to Adult: 7 tax terms and concepts you should know

How to Adult: 5 ways to track your spending

Tips for navigating a medical hardship when you’re unable to work

Family planning for the LGBTQ+ community

11 essential things to do before baby comes

Webinar: Uncover the cost: Starting a family

Preparing for adoption and IVF

How to plan and save for adoption and in vitro fertility treatment costs

Closing on a house checklist for buyers

Resources for managing financial matters after an unexpected death

What you need to know as the executor of an estate

What documents do you need after a loved one dies?

How to prepare for a natural disaster

Checklist: financial recovery after a natural disaster

College budgeting: When to save and splurge

Student checklist: Preparing for college

Webinar: Uncover the cost: College diploma

How to save money in college: easy ways to spend less

Checklist: How to gain financial independence from your parents

The A to Z’s of college loan terms

Co-signing 101: Applying for a loan with co-borrower

Practical money skills and financial tips for college students

How to build credit as a student

5 things to know before accepting a first job offer

How I did it: Paid off student loans

Webinar: Bank Notes: College cost comparison

From LLC to S-corp: Choosing a small business entity

5 tips for seniors to stay a step ahead of schemers

Recognize. React. Report. Don't fall victim to financial exploitation

Recognize. React. Report. Caregivers can help protect against financial exploitation

Is online banking safe?

Identity stolen? 5 steps to take immediately

How you can prevent identity theft

Webinar: U.S. Bank asks: Are you safe from fraud?

How to talk to your lender about debt

7 steps to keep your personal and business finances separate

Know your debt-to-income ratio

How to use your unexpected windfall to reach financial goals

U.S. Bank asks: What do you know about credit?

Is a home equity loan for college the right choice for your student

How to apply for federal student aid through the FAFSA

Be careful when taking out student loans

Your financial aid guide: What are your options?

Take the stress out of buying your teen a car

Crypto + Relo: Mobility industry impacts

Military homeownership: Your guide to resources, financing and more

For today's homebuyers, time and money are everything

Crypto + Homebuying: Impacts on the real estate market

Comparing term vs. permanent life insurance

For today's relocating home buyers, time and money are everything

Webinar: Mindset Matters: How to practice mindful spending

How to financially prepare for a military PCS

Webinar: ESG for Corporations: Building an all-weather, long-lasting strategy

High-cost housing and down payment options in relocation

Financial checklist: Preparing for military deployment

Common pitfalls to avoid in the equipment financing process

The secret to successful service provider integration

Consolidating debts: Pros and cons to keep in mind

Webinar: Smart habits and behaviors to achieve financial wellness

What I learned from my mom about money

I own two electric vehicles. Here’s what I’ve learned about buying and driving EVs.

How I did it: Deciding whether to buy an RV

Car shopping Buying versus leasing your next vehicle

Questions to ask before buying a car

What you should know about buying a car

Improving your credit score: Truth and myths revealed

Can you take advantage of the dead equity in your home?

CancelSave & Close Planning self-care moments that matter (and how to finance them)

How I did it: Turned my side hustle into a full-time job

How to get started creating your business plan

Talent acquisition 101: Building a small business dream team

Make your business legit

7 tips to help grow your business after launch

How to test new business ideas

Costs to consider when starting a business

How to redefine challenges with business collaboration

How to sell your business without emotions getting in the way

5 steps to take before transitioning your business

10 tips on how to run a successful family business

The costs of hiring a new employee

How to expand your business: Does a new location make sense?

The essential business tips for tax deductions

How to build a content team

Investing in capital expenditures: What to discuss with key partners

Finance or operating lease? Deciphering the legalese of equipment finance

Buying or leasing? Questions to ask before signing a contract

Safeguarding the payment experience through contactless

Maximizing your deductions: Section 179 and Bonus Depreciation

ABCs of ARP: Answers to American Rescue Plan questions for counties

How to be prepared for tax season as a gig worker

How to improve your business network security

Should you buy a house that’s still under construction?

COVID-19 safety recommendations: Are you ready to reopen?

Achieving their dreams through a pre-apprenticeship construction program

Start of disclosure content

Loan approval is subject to credit approval and program guidelines. Not all loan programs are available in all states for all loan amounts. Interest rate and program terms are subject to change without notice. Mortgage, home equity and credit products are offered by U.S. Bank National Association. Deposit products are offered by U.S. Bank National Association. Member FDIC.

U.S. Bank is not responsible for and does not guarantee the products, services or performance of U.S. Bancorp Investments, Inc.