Sep 2, 2025
Being a working parent means juggling two full-time jobs: raising your child and showing up for your 9-to-5. On top of the emotional and physical exhaustion, there’s another challenge that weighs heavily — child care costs.
Now, we’re learning more about the price of day care in the years leading up to kindergarten.
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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.
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“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.
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Not so simple choice
Even though a parent taking a break from the workforce may be cost-effective financially for some families, it doesn’t mean there aren’t consequences for taking a step back.
For example, salaried workers can generally expect to see their income increase over time. Let’s say your job hands out annual cost-of-living raises averaging about 3%. If you step out of the workforce, you miss out on those steady bumps. So, if you were earning $50,000 a year, with 3% raises, after five years your salary would climb to nearly $58,000.
By pausing your career, you could potentially return and start at the bottom-rung salary at your position, missing out on growth you might have otherwise earned. Not to mention, there could be harder-to-quantify effects on career trajectory and future opportunities.
Emily Green, head of wealth management at Ellevest, told CNBC Make It that the real calculation isn’t just about one’s paycheck. It’s about the ripple effect.
“You need to really crunch some numbers to understand what sacrifices you may need to make in the short, medium and long term, and the feasibility of doing that,” she said.
Stepping away from work may save money on child care in the moment, but it can also mean eventually walking back into the workforce with fewer raises, fewer promotions and fewer options. Before making the leap, it’s worth treating the decision the way you would any major investment — by weighing the upfront cost against the long-term return.
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Victoria Vesovski is a Toronto-based Staff Reporter at Moneywise, where she covers the intersection of personal finance, lifestyle and trending news. She holds an Honours Bachelor of Arts from the University of Toronto, a postgraduate certificate in Publishing from Toronto Metropolitan University and a Master’s degree in American Journalism from New York University’s Arthur L. Carter Journalism Institute. Her work has been featured in publications including Apple News, Yahoo Finance, MSN Money, Her Campus Media and The Click.
