The cost of childcare, both in terms of time and money, is a pressing concern for many parents, as it places a strain on household finances.
For many families, the cost of nursery and other childcare services consumes entire paychecks, devastates budgets, and makes it difficult to save money for other financial objectives.
The high cost of child care causes many families to struggle to find affordable care arrangements or to question whether both parents should remain in the workforce.
If a family cannot locate or access child care due to a lack of providers, one parent may be forced to leave the workforce, eliminating that second, and often critical, source of income.
In this article, we’ll look at ten ways you can save money on your childcare costs.
Are childcare costs rising?
Increased demand, rising labor costs, location and convenience and higher standards of care are all factors in why childcare costs are on the rise.
For example, babies and younger children require more focused attention and care than do, say, 6-year-olds. Places that have a lot of young ones will need more staff – usually at a staff-to-child ratio of 1-4.
The termination of the federal grant program for child care in September 2024 was also a factor in pushing childcare costs even higher. Since 1990, childcare costs in the United States have gone up by 263%*.
*This article was originally published September 1, 2023 – childcare costs have increased by 43% in less than 2 years.
The Economic Policy Institute recently released a report on the current state of childcare costs in the US.
The fact sheets use state-level data from the Department of Labor and Child Care Aware of America on the cost of infant and 4-year-old care to determine child care costs for one- and two-child families. – epi.org
According to it’s findings:
- In 38 states and the District of Columbia, child care for one infant costs more than public college tuition.
- In 17 states and Washington, DC, childcare is more expensive than rent
According to information from 3,000 American parents in Care.com’s 2025 Cost of Care Report, households reported to pay an average of 22% of their total household income on childcare.
Given this, it is evident that young families will incur recurring costs for child care. Moreover, these costs will continue to rise. Therefore, having strategies to reduce or eliminate these expenditures is essential, particularly if you have financial objectives to achieve.
10 Ways to Save Money on Your Childcare Costs
Here are ten strategies that can help parents save money on childcare costs without jeopardizing their children’s health and safety:
1. Explore flexible work arrangements.
Consider flexible work options, such as remote work or flexible hours.
The US Department of Labor defines flexible work arrangements as an alternative to the traditional 9-5, 40 hour work week.
While not every company will be open to this, it’s worth a conversation, as many places will simply require staff to be there during ‘core hours’ and you could potentially stagger your start and end times.
Depending on your line of work, perhaps you could also arrange to work Tuesday to Saturday, and have your partner, friend, family member care for your kids on their day off.
Remote work can offer really flexible options, especially if you are working in a different time zone and can be hours ahead or behind the company’s core hours.
This could enable you to spend more time with your child at home and potentially reduce the need for full-time childcare.
2. Share childcare with other parents.
Create a childcare co-op with your friends or neighbors where you take turns watching each other’s kids. With the average weekly cost of daycare for one child clocking in at $343/week, every day you don’t need it saves you $68.60.
Look in your local parent groups or ask around with other parents to get a feel for what’s available and who you can trust to swap your kids even one day a week. Care.com also has a Co-Op section on their site, where you can connect with others to help ease the cost of childcare.
Her Money writer Kelly Burch tells the story of how she and another mom in the neighborhood took each other’s young kids once or twice a week, giving themselves those days off. Even on the days when she had both children, she reports that she got way more done than she thought she would because the kids entertained each other.
At two days a week, they also saved 16 hours of childcare costs per week – which, according to the average is $137.20 or $548.80 per month.
3. Look for family assistance programs.
Depending on your income and the size of your family, there may be government programs or grants in your area that can help you pay for childcare.
Head to Childcare.gov for a list of resources that could be available to your family. Some Government Programs include:
Childcare Financial Assistance – States and territories receive funding from the federal government to provide child care financial assistance to help families with low-income pay for child care so they can work or attend school.
Head Start and Early Head Start – Head Start and Early Head Start programs help prepare children from birth to age 5 for school and provide services to support children’s early learning and development, mental well-being, and physical health
State-funded prekindergarten – State-funded prekindergarten programs serve children between 3 and 5 years of age and focus on helping children get ready for kindergarten. Some states offer these programs to eligible families at low or no cost.
There are also:
- Tax Credits and Support
- Support and programs for Native Hawaiians and Alaskans and American Indians
- Work and School Related Programs
- Local and Provider-Specific Assistance and Discounts
These are just a few examples, and availability depends on what state you live in, as well as other eligibility requirements.
4. Consider in-home care.
When you have more than one child, it can be cheaper to hire a babysitter or au pair to care for them in your own home than to send them to a nursery.
Look for options on sites like AuPair.com or UrbanSitter.com or Care.com for a babysitter.
5. Compare different childcare options.
Research and compare daycare centers, home-based daycares, and in-home care to find the most affordable and suitable choice for your family.
Care.com shares findings on costs for one infant child per week:
- Average weekly nanny cost: $827 (up 8% from $766 in 2023).
- Average weekly daycare cost: $343 (up 6.9% from $321 in 2023).
- Average weekly family care center cost: $344 (up 50% from $230 in 2023).
- Average weekly babysitter cost: $167 (down 13% from $192 in 2023).
If you want more specific info on costs based on the age of your child and the type of care, this is an excellent resource.
6. Utilize employer benefits.
Many employers give something called a Dependent Care FSA.
This lets you put away up to $5,000 per year from your paycheck before taxes. You can use those funds to pay for eligible costs for children under 13 who qualify.
This can also reduce your tax burden, as the money is taken before your paycheck is taxed, which can save you money come tax time.
7. Look for part-time programs.
If your child doesn’t need full-time care, you could sign them up for part-time programs or preschools that charge less for less time.
Places like Wonderschool allow you flexible options where you can put your child in programs a few times a week for a full day, a few hours a day every day or just on occasion when you need it.
8. Choose non-peak hours.
Some childcare providers offer reduced rates for non-peak hours or days. If your schedule allows, opt for these hours to save on costs.
While there isn’t a universal program option for this, it would be worth researching and asking childcare businesses near you to see if they offer lower rates at different times of the day or even a tiered pricing system based on when you bring your children.
9. Negotiate fees.
Ask childcare centers or providers if you can negotiate prices or make your own plans that work better with your budget.
10. Seek community resources.
Look into community centers, schools, and libraries in your area to see if they offer free or cheap child care at certain times or events. There are also online resources where you can get assistance with childcare.
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Bonus Tips
Here are some bonus tips you can explore if you are expecting a child or plan to have one.
Build emergency savings early
Child care is just one of many expenses that come up when you have a family, and so it’s important to think about having cash reserves.
Set up an emergency fund before you start having kids. Make sure you have plenty of savings to weather the storm of the challenges of having a child.
Eliminate high-rate debt
Before you have a baby, getting rid of any monthly debt payments can help you save money and make room in your budget for the inevitable childcare costs.
If you can pay off your credit card or car loan before you have your baby, that can be a big help.
Saving Money on Childcare Costs
When you’re trying to save money on child care, it’s important to put your child’s safety and health first.
If at all possible, try to save money ahead of time so it doesn’t affect the quality of care your child gets.
By trying out these ideas and finding the right balance, you can lower the cost of childcare without putting your child’s happiness or growth at risk.
Editor’s note: This article was originally published Sep 1, 2023 and has been updated to reflect economic changes.
