Ways to Save on Child Care

As a parent, you probably want to spend as much time as possible with your children. But in today’s world that typically requires both parents to work, you’re probably forced to seek other forms of childcare. And if there’s one thing that’s true about outside childcare, it’s that it can drain your wallet. Luckily, there are a few ways to save on child care so you don’t have to give an arm and a leg to ensure your baby’s well-being.

Take Advantage of Flex Accounts

Some employers offer Flexible Spending Accounts (FSA) that set aside money to specifically to be used for child care. You can set aside up to $5,000 before taxes to be used for daycare, preschool, and some summer camp programs.

Apply Your Child Care Tax Credit

If your employer doesn’t offer a FSA, you can itemize child care costs up to $3,000 per child per year or up to $6,000 per family. Once you have calculated your expenses, a percentage of that can be applied towards a tax credit that gives you some of your money back.

Talk to HR

More and more companies are recognizing the high expenses of child care on working parents and are helping their employees cover the costs. Talk your your HR director to see if your company offers any benefits such as child care cost reimbursements.

Choose a Daycare Over a Nanny

While nannies offer personalized care for your child, they typically cost much more than a daycare service would. Daycares still offer a safe, nurturing environment for your child at a fraction of the cost.

Share Child Care

If you can’t find a daycare service to fit your needs and schedule and have to hire a nanny, try to see if you can split the costs with someone. If a friend or coworker also needs child care, have the nanny watch both of your children. It may cost a bit more for multiple kids, but splitting the costs is less expensive than paying them all on your own.

Hire a Teen Babysitter

If you just need someone to make sure your kids are doing their homework and playing nicely after school, hire a local teenager from your neighborhood to watch them rather than spending more money on a nanny or child care service, especially if your kids are a bit older.

American Investment Planners can assist with everything you need from 529 plans to helping manage your cash. We are here to make everything as simple as possible. To schedule an appointment with one of our advisors, please call (516) 932-5130 or email info@americaninvestmentplanners.com.