Study: New Parents Spend the Biggest Chunk of Change on Childcare – and Yet Most Don't Budget for It
byKaitlin StanfordJul 16, 2014
Photograph by Getty Images/iStockphoto
It's no secret that childcare costs are skyrocketing. (You need only take a peek into your bank account to reveal that sad-but-true fact.) But according to a recent study by Care.com, it seems like parents may need some reminding about where exactly to delegate funds when it comes to saving for the future.
While most families spend at least $18,000 a year on child costs – which is more than food and housing – only about half of them actually budget for this in advance, the study found. Saving for their kid's college tuition on the other hand? Many start doing that well before their kids are even out of diapers. Of course, that may come as no surprise, since saving for our kids' future college has been somewhat drilled into our brains (practically before we even nabbed diplomas of our own). But apparently, we're far better at that than we are at thinking about what we'll pay the future babysitter/daycare/nanny. That is, until the time actually comes to pony up.
This isn't exactly the greatest news, considering 84% of single parents work and 63% of families have two working parents – making outside childcare costs a necessity, worthy of more serious budgeting consideration. What's more, 52% of parents in the 700-person study had no idea they were eligible for child care tax breaks. When you figure the average weekly rates for a nannies these days range from $472-$504 (depending on how many kids), it's easy to see how fast the dollars add up.