Having an infant means your life will transform in many ways.
You’re accountable for another little person. You’ll endure sleepless nights. And, naturally, you’ll take on a variety of new costs.
Diapers. Formula. Clothes. Playthings. Yet among the most substantial expenses parents face is child care.
Savinly surveyed 2,000 parents in September 2021 about how child care expenses have impacted their lives. Even with extra relief through pandemic stimulus payments and expanded child tax credits this year, a large share of families feel strained.
The Monetary Impact of Child Care
For employed parents, child care is essential. Still, finding and affording quality care is frequently difficult.
“Working households across the nation allocate a notable portion of their yearly earnings to cover child care costs,” said Mario Cardona, Chief of Policy and Practice for Child Care Aware of America, a national child care advocacy group.
For numerous families, the cost of day care can exceed housing expenses.
“In the Midwest, Northeast and South, the cost of full-time, center-based care for two children ranks as the largest household expense category, above housing, transportation, food and health care,” Cardona explained. “In the West, child care for two children is second only to steep housing costs.”
What Do Parents Pay for Child Care?
The average monthly child care cost is $874.50, based on Savinly’s parent respondents.
Half of the parents we polled reported allocating at least 25% of their income to child care. That’s a sharp rise from when Savinly surveyed parents in 2018. At that time, the median share of income parents reported spending on child care was 15%.
Child Care Aware of America applies an affordability guideline from the U.S. Department of Health and Human Services, stating families receiving child care subsidies should not be charged more than 7% of their income for co-payments.
“We’ve adopted this benchmark to assert that no household should spend over 7% of income on child care, whether they receive subsidies or not,” he said.
Under this standard, a family with $5,000 in monthly income should pay no more than $350 per month for child care. About two in five of Savinly’s parent respondents report spending $500–$999 a month — $125–$249 per week — on child care, while 44% pay $1,000 or more a month — $250 a week or more — on child care.
Here’s How Much Child Care Costs U.S. Parents
Expenses by the Month
| Monthly Cost of Child Care | Parent Respondents (%) | |||
|---|---|---|---|---|
| Under $500 | 17% | |||
| $500-$999 | 39% | |||
| $1,000-$1,999 | 28% | |||
| $2,000 or more | 16% |
Expenses by the Week
| Weekly Cost of Child Care | Parent Respondents (%) | |||
|---|---|---|---|---|
| Under $125 | 17% | |||
| $125-$249 | 39% | |||
| $250-$499 | 28% | |||
| $500 or more | 16% |
The Trade-Offs Parents Make
The price of child care forces caregivers to face difficult decisions.
Four in 10 parents report incurring debt because of child care costs. More than a quarter have been forced to relocate to afford child care. Nearly 38% have taken on a second job or side gig.
Paying a child care provider can make it hard to cover other bills. Almost 28% of parents say they’ve had to choose between paying for child care or covering their rent or mortgage on time.
About 35% say they’ve had to decide between child care expenses and paying a credit card bill by its due date.
Missing a payment often leads to late charges, but for some families, an extra fee is preferable to losing a spot at a child care center and scrambling to find alternatives.
Other parents conclude it’s more sensible to leave paid employment than to spend so much of their earnings on child care. Nearly one in five parents report quitting a job because of child care costs.
Exiting the labor force has consequences beyond lost wages. Many stay-at-home parents struggle to re-enter the workforce because of gaps in employment. They miss chances for professional advancement. Without access to an employer-sponsored 401(k), stay-at-home parents forgo opportunities to boost their retirement funds.
Support Is Needed
Savinly’s survey on child care costs found that pandemic-era financial relief helped families cover care expenses.
Seventy percent of parents said stimulus checks eased child care costs during the pandemic. Over 83% of those who received monthly child tax credit payments said those funds aided with child care expenses this year.
However, this aid is temporary. About one in five parents getting child tax credit payments reported that when the monthly disbursements end in December, they don’t expect to be able to sustain paying for care.
Methodology: Savinly used Pollfish to field a national survey on the cost of child care, with 2,000 respondents completing the survey Sept. 8–10, 2021. Responses were weighted so each reflects the U.S. population.
Alexandra Lane is a senior reporter at Savinly. Chris Zuppa, Savinly’s multimedia content creator, helped with this report.
