Financial Feud: Paying for daycare vs. Quitting to care for a kid
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In some parts of the country, putting a child through daycare can cost more than sending them to college. That’s according to a report by Child Care Aware of America. The study found that annual childcare fees amount to $15,000 in some states. That means it could be cheaper to enroll your 4-year-old in a four year public college than daycare.
In North Carolina, where Kyle and David live, parents pay more than 12 percent of the state median income for childcare.
When you start to weigh those prices against a weekly paycheck, sometimes staying at home to take care of your kids makes sense.
But according to Liz Weston, personal finance expert and founder of AskLizWeston.com, “It isn’t just about the money.”
“It’s not just the paycheck coming in and how much is going out for childcare,” she says. “Healthcare is one of the big deals. And making sure that you have coverage, and that it’s good coverage.”
Kyle’s career is also an important factor, says Weston.
“The fact is when you take time out of the workplace, it gets harder and harder and harder to get back in,” she says. “And you can’t really recover a lot of times the lost pay, the lost pension benefits — if there’s a pension involved — even the lost social security benefits. Which is why we like couples to think about every possible way that they might be able to work this out.”
Weston recommended considering alternative options like working part time and staggering schedules, so that Kyle and David can cut back on childcare costs but hang on to Kyle’s benefits.
But she stressed the importance of keeping a foot in the workplace.
“Even if you do decide to quit for a while, keep up with your network. Make sure that you’re still going to professional events now and then. Talk to the people you used to work with. Dont’ just drop it, because it’s hard to drop back in and you will have a tough time making up for lost time,” Weston says.
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