Two Kids in Daycare - How Did/Do You Afford It???

[aprilchem]

I feel your pain - we had three in full-time daycare at the same time, and on months with 5 weeks we were paying almost $4k a month on childcare. We definitely had to cut back in order to afford it - no big vacations, we lived in a modest house/area for our income level, drove modest cars, and watched our budget carefully. I don't regret it at all though - my kids are now 7, 9, and 11 and are still close friends with the kids they knew in childcare. The educational and social opportunities they got by being there are tangible and lasting.

 

[HHMcG]

I feel it is a shame that many families are forced to make their childcare decisions based on finances - "I can't work because daycare id too expensive" - "I need to work to pay for daycare." Ideally families should make the childcare decision based on what works for them. And as someone else said you may not know what is best for your family until you give it a try.


I had 3 kids in 5 years. So we had some combination of two in daycare/private preschool/private kindergarten from Jan 2008 - Sept 2014. Then there was dreaded 2012 when we had all three kids in daycare.

I was lucky enough to have the option to go part time at my professional career. After our first was born we decided that worked best for us. I also did a year of extended leave and tried the 'stay at home mom ' route. That did not work for me. I was not social enough to get my fill of adult time. So I went back to part time. I got my time with the kids but I also go my adult time at work which I love.

My salary went completely to daycare and the year we had 3 in the daycare expense far exceeded my salary. We knew it was temporary and just tried our best. DH and I both have excellent jobs that pay well. But it was still tight and we had to cut things (cell phone, extra curricular activities, ect). We did stop putting into savings except 401k, we never had to reduce that. Things were tight but we never had to make drastic cuts.

This year we made our last ever 'daycare' payment. It was bittersweet. We have alot more money to spread around but my babies are growing up too fast.

 

[crisi]

If you actually read what I wrote you would see that I wrote about the hidden costs of staying home that people don't consider. But hey, why let facts get in the way of your soapbox...

I do know that. Jen said she just grabbed two posts - she wasn't responding to you in particular, but to the tone. And I was responding to you saying "you are the only one turning this into a battle" - the battle started the first time someone said "stay home cause its cheaper. But I'm sorry if I came off as if I wasn't listening to you or if I came off as snarky or anything, it certainly wasn't my intent.

 

[crisi]

I feel it is a shame that many families are forced to make their childcare decisions based on finances - "I can't work because daycare id too expensive" - "I need to work to pay for daycare." Ideally families should make the childcare decision based on what works for them. And as someone else said you may not know what is best for your family until you give it a try.
.

I'd phrase that as more "be open to change" - not everyone has the luxury of quitting a job to give staying at home a try and then if it doesn't work out, stepping back into their old role. There are few things I can say with certainty about how I raised my kids - but not quitting a job that I really enjoyed and was flexible about parenthood was a good decision - I've had a few jobs with a few companies since then, and that one was by far the best job with the best company I've ever had. Had I thrown that away when my kids were little, I'd have regretted it. Be open to the idea that whatever you decide to do starting out, there may be a time when your kids need someone home. Or where your job becomes not worth the stress. Or where an opportunity for your dream job comes up when you thought you'd be home. Be prepared for a guiltless "I thought I'd enjoy being home with my kids - and I don't" And an equally guiltless "I know I spent a decade becoming a doctor, but its too consuming and want to stay home." And as long as you can financially make it work and aren't dependent on anyone other than your partner - its your decision.

Whatever the decision is, kids are going to be expensive and involve sacrifice. Staying home means loss of income. Working usually means paying for childcare. And that's just the tip of the iceberg. (I have college bills in my bill pile). All choices come with opportunity costs - which are more than just financial.

 

[crisi]

Double post

 

[ToddlerMom311]

My husband and I are thinking about a 2nd child also and have often wondered this very same question. Originally the plan was to wait until our daughter was 4 before even thinking about another child because of the daycare expense. But for the last few months I've seen babies everywhere and I don't think we can wait another year to try. So far I've forgone a new car and am opting to drive a paid-off vehicle with 100k miles. We have also switched cable providers and started couponing. Once I get pregnant we will consider other cost saving measures like reducing savings or dropping cable altogether. My husband and I also fortunately have gotten substantial raises which have made a 2nd child at this stage more of a reality. It is pretty stressful, but I keep telling myself that once I get pregnant we will still have 9 more months to prepare.

 

[Moramoon]

In our situation DS was 3 1/2 when DD was born. Up until then our sister-in-law watched DS for $75 a week which was an amazing rate. She had agreed to watch DD as well, but 2 weeks before my maternity leave was up she decided she wasn't going to watch children anymore and left us high and dry (started a lot of family drama because of it, but that's another story). I work for a local community college and at the time DH was working as a mechanical engineer at Caterpillar Reman while going to school part time. We budgeted out and managed to make it work with DH staying home to watch the kids which also allowed him to go to school full time. While a lot of it was due to cost part of it was because of just how much DH missed out on when DS was little and he didn't want that with DD. We made quite a few budget cuts to make it work. DH sold his car (was a cheaper payment, but there was no way 2 car seats were going to fit in his car). This lowered our insurance payment. Because he wasn't working he was no longer eating out for lunch. We saved a ton on gas because I wasn't driving 25 minutes out to drop DS off and the 25 min to pick him up. DH's commute was about 35 mintues each way so we were saving there too. We opted for cloth diapers instead of disposables and have saved a ton there (diapers are expensive!). DS will be starting kindergarten in the next couple of weeks. We've thrown the idea around of DH going back to work, but he only has 2 more years of school if he goes full time so for the time being he's going to continue to stay at home. Like crisi said, I think being open to change is the best way to go about it now. A lot can change making things better or worse. Sometimes things that seem like they'll make things difficult actually open up other doors.

 

[Minnesota!]

A strict budget, a friend who was looking to get out of her daycare center job, and lots of praying and tears. We went from $456/week with both in daycare to $300/week with a nanny. Still a lot when we were, at the time, only making about $55K between the two of us, and had a ton of medical bills due to my younger son's health crisis at birth.

You need to account for every penny, cut back on whatever you can (examine every part of your life...). It's really SUCH a short time in your parenting journey. It's painful at the time, surely - but it can be done and when you escape the other side...you have a bit more gratitude for what you had been through/current financial state.

 

[powellrj]

When my kids were small and in daycare, we found it was much cheaper to use church daycare or take them to someone's home. I know many aren't comfortable doing those things, but it was what we needed to do. A couple of years ago we had 3 in college at the same time. Luckily we just have one and she is a senior. We have one in grad school, but that's on them. Once the youngest graduates next year, we will have 3 in grad school, but like I said that is on them! Daycare does prepare you for the college years!

 

[kymom99]

When my kids were small and in daycare, we found it was much cheaper to use church daycare or take them to someone's home. I know many aren't comfortable doing those things, but it was what we needed to do. A couple of years ago we had 3 in college at the same time. Luckily we just have one and she is a senior. We have one in grad school, but that's on them. Once the youngest graduates next year, we will have 3 in grad school, but like I said that is on them! Daycare does prepare you for the college years!

My son loved going to a sitters home! He hated daycare. Playtime was too chaotic and overwhelming for him. The sitter's house was like a family with kids of various ages. He went half days to preschool and then kindergarten and she was right across the street from the school. She charged $15 a day back then and then increased to $20. Not sure what she charges now but she was an angel. Because she was inexpensive we couldn't deduct the cost on our taxes.

 

[Yarbogash]

Great thread. Lots of good perspectives.

When our first came along my wife worked while I stayed home. Last company I worked for had relocated to another country, we had a good deal on a rental in a co-op and my wife was making good money so it was an easy decision. For extra cash sometimes I put in days on weekends or when somebody could watch our son as a production assistant in the movie business; 15, 20 hr long shifts but got us by.

Fast forward to now and we have two children in daycare, she's advanced her career, I have a new career in law enforcement (I did not see that coming) and we are making enough to cover the bills but the main problem here is the cost of housing. The crummiest house you could imagine in this city is still over $1,000,000. We will need to move out of our 2 br condo soon and that is going to hurt. We need daycare costs to come down to have any chance of making it happen.

Like others we work the travel rewards programs to do our Disney trips. I buy pretty much nothing for myself beyond food and the cheapest clothes. Went to cut the cable and cable co gave us a 60% discount for a year. Already pricing hd antennas. And after a long wait we just got both kids in a comparatively less expensive but still very good (better ratios, long term professional staff) non profit daycare.

 

[LovesTimone]

LovesTimone here again...

I have been thinking and talking to some others about this problem. Which is wide spread the cost of preschool, daycare, and after school care is shocking.. While I am in the been there done that category my kids are grown and we have grandkids, its something I am familiar with. I have watched my one of my grandsons since he was born to help my daughter out, he will be heading for preschool at a Academy for 200.00 a week and that is for all day 2 meals plus snack. He's will be just over 2 and half when he is starts in August.

In all this I found out a few options that I did not list that might work out for you.

A friend's daughter is professional and worked for the state, 2 kids later ( they were back to back babies) and the childcare bill was over 2500.00 a month. So she had a friend that was moving away suggested she look at the company she works for and she could get her an interview. So she went to interview and was not really considering leaving, but once in the interview she found out free childcare was part of the benefits package, it was accredited, had preschool and even after school care with pick up. While she did take a pay cut not having that large chunk for childcare they actually had more money at the end of each month. She said it was the best decision she ever made. It allowed her to take her kids with her to work, she could have lunch with them, go on field trips, and they even got to sleep in a bit more as they were all going to the same place.

I have another friend that she does medical/insurance/coding billing for a huge medical practice. She was going to leave and they told her she could work whatever hours she needs to stay, so she works from 4am to noon, Her husband doesn't have to be at his office till 9:00 so he get the kids up, does breakfast, and gets them to preschool, when she gets off at noon she goes pickup them up at 12:30, heads home puts them down for a nap, she nap to. My friend says they have a lot more family time now. She only works 4 days a week now with the same pay as she can get so much more work done than before...

Another friend left her professional job, and works as a server at a breakfast and lunch place 5am to 2pm. Her partner takes the kids to preschool and her mom picks them up at 12:00 takes them home and down for a nap my friend swings by her moms and picks them up by 3:00 at the latest. Oh and she only works 4 days a week and is making the same amount of money if not more money now.

I have another friend that quit her job, and started her own business on ebay.

So the point I guess I am trying to make is thinking and working outside of the box. While these example might not work for you, maybe it will help you think in a different way, or look down a different path.

Pixie dust away

 

[sk!mom]

This answer probably won't help but here goes anyway. The way we did it was not to do it. We spaced our children so that we never had two in day care at the same time. This was a benefit years later in that we don't have two in college at the same time either. This worked for us since we married young and had child #1 just after DH graduated college. We weren't ready for a second for years anyway and since we started young it was possible to wait.

Even with that, my biggest raise ever was when I no longer had to pay day care expenses for DD21 (I'm a teacher though so not in a career that gets big raises). My next big raise will come a year from now when she's graduated college and is hopefully fully employed and off our payroll.

There are financial downsides to this family plan though. A big one is the number of years that we've had to pay dependent healthcare. Especially in recent years when that cost has escalated. Insurance is one area that's always been a flat fee rather than based on number of dependents. We've now had that payroll deduction for 32 years rather than a shorter period had they been closer in age.

 

[Judique]

This answer probably won't help but here goes anyway. The way we did it was not to do it. We spaced our children so that we never had two in day care at the same time. This was a benefit years later in that we don't have two in college at the same time either. This worked for us since we married young and had child #1 just after DH graduated college. We weren't ready for a second for years anyway and since we started young it was possible to wait.

Even with that, my biggest raise ever was when I no longer had to pay day care expenses for DD21 (I'm a teacher though so not in a career that gets big raises). My next big raise will come a year from now when she's graduated college and is hopefully fully employed and off our payroll.

There are financial downsides to this family plan though. A big one is the number of years that we've had to pay dependent healthcare. Especially in recent years when that cost has escalated. Insurance is one area that's always been a flat fee rather than based on number of dependents. We've now had that payroll deduction for 32 years rather than a shorter period had they been closer in age.

We were on a similar plan. I think I paid for daycare for something like 24 years! College was a little better in that there were free rides and other extenuating circumstances - one worked for the school while living at home.

 

[Grumpy1977]

We are fortunate to have retired in-laws that have watched our two kids for three or four days out of the week and then used college aged girls to babysit the rest of the time.

The downside now is that we live an area with bad public schools so my son (7) will be starting first grade in a private school and my daughter (3) will be starting pre-school.

So now we will be paying way more out of pocket then we did when they didn't go to school.

Another positive is that we had people we trusted watching our kids and instilling the same values that we have in them.

I feel your pain though .....kids aren't cheap

 

[quandrea]

We are fortunate to have retired in-laws that have watched our two kids for three or four days out of the week and then used college aged girls to babysit the rest of the time.

The downside now is that we live an area with bad public schools so my son (7) will be starting first grade in a private school and my daughter (3) will be starting pre-school.

So now we will be paying way more out of pocket then we did when they didn't go to school.

Another positive is that we had people we trusted watching our kids and instilling the same values that we have in them.

I feel your pain though .....kids aren't cheap

We started homeschooling for this very reason. Much cheaper than three private school tuitions. That would have cost $42000 per year here in Canada. I stay home and teach.

 

[tvguy]

We are fortunate to have retired in-laws that have watched our two kids for three or four days out of the week

We had both Grandmas within 6 miles, so we were lucky. My mom was retired so they usually ended up at her house. To be honest, while the financial impact was HUGE, the bond both my kids had with their Grandparents (all deceased now) is even more special. Especially for me because I never knew my Grandparents.

 

[Dugette]

I think others have covered things pretty well, but I'll just throw in a few thoughts:

1.) We only have one child, but still do many of the money-saving things on these lists. Daycare is expensive here (MN)! (Centers are $1600-$1800/mo. for an infant in our area, but we are not a high cost of living or high salary area in general, so this is a huge stretch. We went the home daycare center route to save - which has been awesome in many ways!) BUT, unless it is 100% necessary, don't cut retirement unless you have it on really solid over-funded footing. It's very hard to make up those losses down the road. If it's 529 vs. 401K, just remember there are college loans, but not retirement loans.

2.) We likely only can have our one child, but when we thought we'd have two, I made up a LONG-term budget (in Excel) - like, out past when daycare ended! I found it really depressing to look at our barebones 2-in-daycare budget (with decreased travel), but seeing where we ended up after was comforting. I recommend trying to take that outlook when adjusting the budget. Also, I want to toss in for anyone else that is stressing about this or may be unsure about adding a second child: only having one child is a perfectly valid and healthy option as well - it wasn't what we planned, but turns out we are very happy with our little family as it is - and we are able to keep a nice travel budget to boot!

3.) I lurk the Family Finances forum over on Babycenter and there are lots of good budgeting tips and examples there from other parents. I can tell you that they would probably recommend paying off the car loan (or selling the car and buying something at a lower price point), completing the emergency fund, and having a full working budget in place before having #2. The other thing they often mention is that there is a "sweet spot" for a few years after daycare where kid-related expenses go down, but then they pick way up again as the child gets involved in sports/hobbies/school activities and the costs can reach back up near daycare cost levels, so be ready for that down the road (not to mention college costs, of course).

Best of luck!

 

[EilonwyWanderer]

With two kids in daycare we pay $4500/month (one infant at 2460, one preschooler at 1945, which is cheap for the area!). The ONLY way we could afford to have a second child is when we figured out we wanted one, we started saving. My husband's ENTIRE paycheck goes towards daycare and some of mine (the rest of mine is spent on the mortgage/food/clothes/bills) and it eats into our savings every month. I'd love to have another one, but we definitely have to wait until at least the first is in public school because it would be IMPOSSIBLE!

But you find ways to make it work. Sometimes diapers and food end up on a credit card. As they get older, the price goes down a little bit. I don't know what we did with all this money before we had kids, but we're going to be rich when they get out of daycare!

One thing to think to consider if one of you is thinking about staying home is what a five+ year gap on your resume will look like. Do you eventually want to go back to being a two income family? If so, that's something to take into consideration. You'll have missed out on all those raises and promotions. How old will you be, trying to get back into the work force, etc.? In our case, it was not worth missing out on the years of moving forward in our careers even though right now it suuuuuuuuucks money wise.

 

[drnp]

I feel your pain OP, we just got out of the two kids in daycare situation 2 years ago. I did a couple things to help with the monthly budget:
1. We found a daycare that took credit cards. I get 2% cash back on my Fidelity Visa, and our tuition was about $2000/mo, so over the year we got about $480 back at end of year.
2. We used the dependent care flex spending account at work to pay for some of the expenses with pre tax dollars which helped ($5000 max which saved us over $1000 in taxes over the year), plus we did get extra tax deduction at end of tax year for the extra daycare expenses.
3. We changed vendors or renegotiated every monthly bill we could. I found a cheaper electricity provider which brought our monthly bill down about $50/mo. I also got our cable/internet bill to decrease by $40/mo by just threatening to leave to another provider. We also shopped around for new car and homeowners insurance quotes and actually found plans that saved me over $1700 a year. I had gotten very lax in comparison shopping for such things and was shocked by how much money I was wasting by not looking around more. I've been doing it more ever since.

We also didnt take a big vacation for about 2 years. It was definitely a leaner time, but it was temporary and we came through it just fine and our savings were still intact.