Childcare can be an expensive burden. Most parents want to save money but don’t want to compromise on the care their children receive. Thankfully, there are plenty of steps you can take to reduce your childcare costs while still getting great care.
Childcare co-ops are a new trend that offer a DIY approach to childcare. The concept works by allowing parents to leave multiple children with one caregiver, at which point the hours are credited to that caregiver’s co-op account. If that caregiver then leaves their kids with another co-op member, they have hours taken off their account. It’s a great way for your kid to play with other kids and save some money at the same time.
If you’re a working parent, you need to ensure you take the federal tax credit for childcare costs. Talk to a tax specialist to see if you are eligible for tax credits. Tax credits can total up to 35 percent of your childcare costs. Even though there is a cap of $3,000 per child, every deduction helps.
Flexible Spending Accounts
Ask your employer if they have a flexible spending account available for dependent care. You can then determine how much of your pre-tax salary or payments you want to be deducted from your paycheck for childcare costs. There is a cap here as well, but you may receive better tax bonuses than if you were to independently file for the federal tax credit for childcare costs. Especially if your costs well exceed $3,000 a year.
If you don’t work outside the home, taking care of your kids at home is obviously the most cost-effective option. If you do work, explore the possibility of doing remote work from home if your employer is flexible. You can also save money by enlisting family members and responsible teenagers from around your neighborhood to help out when you’re not around.
Instead of a nanny working for just your family, the nanny works for a group of families so you can share the cost with another family. There are usually fewer kids than at a daycare, which means your child gets more personalized attention. It’s also a lot cheaper than hiring an individual nanny. Additionally, most nannies prefer nanny shares due to the fact they end up making more money in the long run.
Hopefully, you can put some of these money saving tips into use in your own life. Many of them aren’t just a great way to save money, but also a community-based approach to childcare that just about anyone can appreciate.