Budgeting Daycare Costs

A Twitter listener wants to know what percentage of income should be dedicated to childcare. Dave says he doesn’t have a particular percentage when it comes to childcare.

QUESTION: A Twitter listener wants to know what percentage of income should be dedicated to childcare. Dave says he doesn’t have a particular percentage when it comes to childcare.

ANSWER: I don’t have a percentage of your income. Childcare really doesn’t vary much unless you buy a private nanny or something. I guess that would be a lot higher, and you’d have to have a big income to be able to do that. A lot of people have childcare. A single mom making $20,000 will spend a high percentage of her income on childcare—a lot higher than a couple making $60,000. Childcare will probably cost each of those a similar amount. I think what you have to do is shop for a quality situation that is safe and good for the kid and the least expensive possible. That would be true of any income. I don’t really have a solid answer on that.