The COVID-19 pandemic has put lots of extra stress on parents. For many, working from home and watching the kids at the same time has been especially taxing. Because of these difficult circumstances, many parents are turning to daycare providers, nannies and other childcare options that give themselves the space they need to work and give kids the attention and care they need.
These additional support options are helpful; but funding them can be daunting when the economic future is unpredictable. However, knowing your funding options when it comes to unexpected childcare expenses can take some of that stress off of your plate.
The COVID-19 pandemic has probably changed how you spend your money. If you’re working from home, you’re likely spending less on gas or transportation. Money you might normally use for eating at restaurants, going to movies or extracurricular activities for your child is now available to spend elsewhere. Create a new budget that reallocates these funds towards childcare and stick to it — this can help lift some of the financial burden it might otherwise cause.
A dependent care FSA (DCFSA) is a pre-tax payroll deduction that you can use to pay for eligible care services for your dependents, including childcare. Benefits enrollment is coming up at many companies, so take some time to investigate the options your employer offers. Enrolling in these programs will also reduce the amount you owe on your taxes at the end of the year. If you’re currently unemployed, have been furloughed ,or your employer doesn’t provide this benefit you can check to see if you qualify for FSAFEDS, a government assistance program that helps fund childcare.
Childcare is expensive, for those that weren’t planning for these additional costs, getting a personal loan may be able to alleviate stress as you make an adapted financial plan with these childcare expenses in mind. Look for a loan with a repayment plan that fits your current financial situation. For example, if you don’t have a steady source of income, a longer repayment period with smaller monthly payments may work well for you. Learn more about personal loans to see if this option is right for you.
Navigating finances during COVID-19 is tough and it’s never a bad idea to touch base with a banker about your financial position. Your banker can help you examine your spending habits, adjust your savings goals or apply for loans, and help you find creative ways to fund childcare that don’t stretch you too thin. You can always make an appointment to talk with a U.S. Bank banker whenever you need professional input.
Navigate your financial well-being throughout the COVID-19 situation here.