Parents are now 'being stretched beyond their limits' to cover rising child care costs — but is leaving the workforce really the better choice?

According to an analysis of Labor Department data by The Wall Street Journal, the median cost of five years of day care centers in the U.S. is around $44,000. This includes one year of infant care, two years of toddler care and two years of preschool. The median cost for the most expensive area, Arlington County in Virginia, was nearly $147,000, while the median cost in the least expensive area, Wayne County in Kentucky, was around $24,000.

Furthermore, Labor Department data also shows U.S. families spend up to 16% of their median income on day care center costs.

For many families, the math simply doesn’t work. Even if both parents are working, it’s possible one’s paycheck barely covers the cost of day care, which makes stepping away from their job to take on child care duties themselves feel like the practical choice. But leaving the workforce can carry financial ripple effects that stretch far beyond a child’s early years.

When child care breaks the budget

Take Amanda and Carlos, who live just outside New York. On paper, their household income of about $180,000 should allow them to live comfortably, but the reality is their budget is fairly tight.

On an episode of finance expert Ramit Sethi’s podcast, Money for Couples, the pair revealed they spent $1,881 a month on day care alone. To put that in perspective, Amanda’s net income was about $3,739 a month, meaning more than half of her paycheck went straight to day care costs.

It’s a personal example of a national problem. The cost of day care and preschool soared 263% from January 1991 to April 2024, according to a KPMG report, compared to 133% for the entire consumer price index.

In their arrangement, Amanda covered day care costs while Carlos handled other major expenses like rent. But after running the numbers with Sethi, the couple came to a surprising conclusion: financially, Amanda could actually quit her job and the household might still break even or even come out ahead. Being a stay-at-home parent, it turns out, would not only eliminate day care costs from the budget, but potentially cut down on other expenses. For example, she’d no longer have a daily commute to work, which means buying less gas, and she’d have more time for meal prep, which could translate into cooking more meals at home and spending less on take-out dinners.

This kind of math has become all too familiar to families across the country.

“They’re being stretched beyond their limits — cutting back spending on essentials, taking on extra work or even stepping away from their careers to afford care for their kids,” said Sean Lacey, general manager of Care.com. “Parents need relief, and they need it now, or we will continue witnessing parents putting themselves into an inescapable financial ruin.”

The website commissioned its own survey in which families reported spending more on child care in 2024 than the previous year in most cases. The average family spent 22% of its income, plus 29% of savings, on child care. Such costs, however, included the use of nannies and baby sitters.