Childcare Costs - Is everyone paying this much?!?

[familydocPA]

People can make $20-25/hour working for McDonald's these days. How much do you expect to pay the person you are entrusting with (presumably) the most important things in your life?

[sealion1]

Are you willing to take a paycut?

If you cut her income even for reduced work, she will start looking for another job that pays the same or more. And she'll likely find it. It's probably not worth it to you to cut her salary by $10k, which is nothing to you, but a lot to her. And as you said above, "our nanny is worth her weight in gold." So either she weighs nothing or you don't know how much gold is worth.

Also I would 100% take a 25% pay cut for a 75% work reduction…

[benign_user]

I would like to get a sense of what others on this forum think is a "reasonable" amount to pay for childcare. My wife and I live in a HCOL area and both work a lot of hours. I am a cardiac anesthesiologist that takes Q4 beeper call and Q11 in house overnight call. I also end up working late unpredictably during the week if a heart is added onto the schedule.

My wife is a partner at a big corporate law firm. She commutes downtown by train at least 3 days per week and bills a lot of hours. Its not unusual for her to hop back on her laptop once she gets home around 6pm and also on weekends. Our kids are 8, 5 and 2. Our school district only does half day kindergarten, and they seem to give the teachers a day or two off every month for a random in service/training. Even when the kids are old enough for full time school we will likely need full time help to cover summers, school holidays and whatnot.

We ruled daycare out pretty quick because they close too early for us to reliably pick the kids up. We could consider an au pair at some point but we would have to add an au pair suite to our house to meet the program requirements. They also take 10 weeks to get here, which would be very hard to cover. That left us with the full time nanny option, which we have been using for ~8 years. We have had some very good ones who have stayed >3 years and some really problematic ones that weren't reliable.

We started out paying around $20/hr in 2015....but rates have escalated in our area. Our most recent search had most candidates expecting $25-30/hr. Most of them also expect year end bonuses of 1-2 weeks salary. Given our typical 42 hours per week plus taxes (we use a nanny payroll service), this amounts to about $70k/year! It is a huge chunk of our annual spending. It makes me nauseated to think about how many brutal 24 hour calls I take every year just to pay for childcare.

We both have FIRE aspirations and would like to ramp down sooner rather than later.

How much are the rest of you spending? Any other ideas?

25-30 per hour sounds normal. My mother-in-law watches our kids.

[Dogtor]

Our three kids are in full time daycare (5 days a week, usually arrive at 8, pick up around 5:30-6) and we pay 43K per year. We’re in a MCOL area but childcare here is very expensive.

[Dogtor]

Or you can have a good old-fashioned farm and expand your operations as you put your children to work. Win, win.

This is our plan, we routinely joke about ours working the field in potato sacks.

[jfoxcpacfp]

Lottie costs $28/day and it is one of the best daycares in Brentwood. Bonus - I lucked into moving 4 doors down from them.

Ok, so it’s for dogs, but still…

[Kamban]

Lottie costs $28/day and it is one of the best daycares in Brentwood. Bonus - I lucked into moving 4 doors down from them.

Ok, so it’s for dogs, but still…

You are lucky with the costs too. I pay $40/day ans have to supply his food too.

Before I had a pet I could never imagine it to be this expensive. Luckily these costs become insignificant when you are past FI.

[B1GM0N3Y86]

MCOL Southeast.
Nanny - $20/hr x 30hr weeks

3 months into having our first child and being new homeowners have led me to the understanding that both are more costly than you initially think they'll be...

[East coast]

Our three kids are in full time daycare (5 days a week, usually arrive at 8, pick up around 5:30-6) and we pay 43K per year. We’re in a MCOL area but childcare here is very expensive.

Hate to break it to ya, but 43k a year for 3 kids full time day care is tens of thousands away from being "very expensive". Thats closer to 60-70k in other not expensive cost of living places that I've priced out.

[Dogtor]

Hate to break it to ya, but 43k a year for 3 kids full time day care is tens of thousands away from being "very expensive". Thats closer to 60-70k in other not expensive cost of living places that I've priced out.

Maybe I should have said “expensive relative to the other costs of living here.” I know people in the Midwest paying 1/3 as much for as many kids.

Also, there’s no award for having the most expensive daycare

[East coast]

Maybe I should have said “expensive relative to the other costs of living here.” I know people in the Midwest paying 1/3 as much for as many kids.

Also, there’s no award for having the most expensive daycare

Wow...1/3 of 43k for 3 kids full time? Assuming 'only' 8 hour days 5 days a week, that 2 dollars and 30 cents an hour per kid. With typical requirements for daycare aged kids having some sort of 3 or 4 to 1 ratio of teachers, that's only $6.90 an hour for that teacher assuming literally every penny only going to caregiver and no electricity or 'place'. We must be talking about different countries and/or lots of govt subsidies.

[JBME]

Maybe I should have said “expensive relative to the other costs of living here.” I know people in the Midwest paying 1/3 as much for as many kids.

Also, there’s no award for having the most expensive daycare

childcare is something where the costs vary widely and it's not necessarily cheaper in the midwest. I'm int he midwest with 3 kids. $43k sounds like what it was like for us when all three were in daycare (actually, I think it was close to $1k/wk so $52k/yr) and we have friends in NYC who paid far less than that

[FIREshrink]

you have three kids, in a HCOL, and you both work a ton of hours. I think you're paying a fair price.

[ENT Doc]

I would like to get a sense of what others on this forum think is a "reasonable" amount to pay for childcare. My wife and I live in a HCOL area and both work a lot of hours. I am a cardiac anesthesiologist that takes Q4 beeper call and Q11 in house overnight call. I also end up working late unpredictably during the week if a heart is added onto the schedule.

My wife is a partner at a big corporate law firm. She commutes downtown by train at least 3 days per week and bills a lot of hours. Its not unusual for her to hop back on her laptop once she gets home around 6pm and also on weekends. Our kids are 8, 5 and 2. Our school district only does half day kindergarten, and they seem to give the teachers a day or two off every month for a random in service/training. Even when the kids are old enough for full time school we will likely need full time help to cover summers, school holidays and whatnot.

We ruled daycare out pretty quick because they close too early for us to reliably pick the kids up. We could consider an au pair at some point but we would have to add an au pair suite to our house to meet the program requirements. They also take 10 weeks to get here, which would be very hard to cover. That left us with the full time nanny option, which we have been using for ~8 years. We have had some very good ones who have stayed >3 years and some really problematic ones that weren't reliable.

We started out paying around $20/hr in 2015....but rates have escalated in our area. Our most recent search had most candidates expecting $25-30/hr. Most of them also expect year end bonuses of 1-2 weeks salary. Given our typical 42 hours per week plus taxes (we use a nanny payroll service), this amounts to about $70k/year! It is a huge chunk of our annual spending. It makes me nauseated to think about how many brutal 24 hour calls I take every year just to pay for childcare.

We both have FIRE aspirations and would like to ramp down sooner rather than later.

How much are the rest of you spending? Any other ideas?

What’s more depressing is thinking about the pre-tax income required to generate that after tax $70k. For most people it makes sense for one spouse to just not work.

[JBME]

What’s more depressing is thinking about the pre-tax income required to generate that after tax $70k. For most people it makes sense for one spouse to just not work.

there's more to it than just this though. From a financial standpoint, even if the spouse is making $50-$80k gross, that spouse could well have access to other financial benefits that the other spouse might not have. Minimally, you've doubled your tax-preferred space by getting a HH with 2 401ks rather than 1. The spouse also could be highly educated and/or went into student debt to get a degree and it would be a waste to just then not work if the person wants an ROI on that degree. It could break up a marriage if the lower earning spouse wants to work and the other basically says it's not worth it b/c of daycare costs