Childcare in high cost of living area

[gmaninmass]

My wife and I are expecting our first child in August.  Financial Situation:

• Live in suburb a few miles west of Boston
• We both own cars with no payments on them
• I walk to work, she has a 30 minute commute that we find acceptable
• Mortgage around $470k on house worth ~ $650k, payments with property taxes ~ $2700/month (high COL area)
• 60k in cash equivalents
• ~$220k in Roth and/or brokerage accounts
• Combined income post-taxes around $150k (The split between us on this is 66/33 if that matters)
• Pre-child we are investing ~ 6.5k/month

No, I do not want to debate whether we should have had a kid at this point.  I'm looking at childcare options (daycare, nanny-share, etc) and not seeing anything that we feel is appropriate for infants below 2200/month.  We don't have family/friends nearby that can help out with this, so clearly need outside help.

Is there anyone on here in high COL area that found better solutions?  I'm really depressed that with additional costs of having a kid, the path to building wealth become really narrow without me working extra jobs to make up the difference.

[ShoulderThingThatGoesUp]

So the 33% parent will be working for $11.57 an hour after childcare expenses?

Honestly, investing $4.3k/month isn't so bad. You can somewhat defray the cost by using a childcare FSA.

[mozar]

I don't have a kid but I've looked at daycares in my hcol area. I live in the suburbs too and daycare near my house is 18k a year, where near my work it's 24k a year. Have you played around with location? It seems like you are easily in a position to pay 2200 a month for childcare. I'm not sure what you mean by "appropriate " but quality is something you have to pay for. And childcare workers already make peanuts.

[little_brown_dog]

I am also in the area so I know firsthand what you are talking about. Massachusetts is the most expensive state for infant childcare. I would expect to pay about 2k per month for a full time, high quality day care (in home or center) or nanny. We found the same thing -minimum of 2k, going up to a max of 3k per month for an infant.

We got around it by having me stay at home. We preferred having a parent at home anyway, but the extreme cost certainly helped solidify our preference. I think the lowest price I found was 2k for an in-home daycare, but that was a while back. Do you both have to work, or can the lower earner stay home (or work part time) until the baby is old enough for daycare to be less expensive? If you can't or don't want to give up having 2 full time working parents, you might want to find a SAHM in your neighborhood who will watch your child for you during the day for a price a little lower than what a nanny would cost. Some friends across the country do this - they watch another couple's child for about 1/2 the cost of a nanny. The parents drop the baby off every morning at the SAHM's house. Obviously this requires some flexibility on the parents' part, as it is more like a family care arrangement instead of a formal professional arrangement. You have to be willing to have the mom call of sick because of illness in her family, or accept that she has a different parenting style and can't be required to parent in a specific way like you can ask a nanny to do.

You say you don't feel like many of the available care arrangements are "appropriate" for infants which suggests to me that ideally you would prefer not to do daycare. If that is the case, you should do some soul searching and see if the stay at home parent model is feasible for you. For us, it was completely worth giving up the extra income, but everyone's preferences and financial situation are different.

[VaCPA]

My wife and I are expecting our first child in August.  Financial Situation:

• Live in suburb a few miles west of Boston
• We both own cars with no payments on them
• I walk to work, she has a 30 minute commute that we find acceptable
• Mortgage around $470k on house worth ~ $650k, payments with property taxes ~ $2700/month (high COL area)
• 60k in cash equivalents
• ~$220k in Roth and/or brokerage accounts
• Combined income post-taxes around $150k (The split between us on this is 66/33 if that matters)
• Pre-child we are investing ~ 6.5k/month

No, I do not want to debate whether we should have had a kid at this point.  I'm looking at childcare options (daycare, nanny-share, etc) and not seeing anything that we feel is appropriate for infants below 2200/month.  We don't have family/friends nearby that can help out with this, so clearly need outside help.

Is there anyone on here in high COL area that found better solutions?  I'm really depressed that with additional costs of having a kid, the path to building wealth become really narrow without me working extra jobs to make up the difference.

Can I ever relate. Childcare in my area(DC metro) is really expensive. I would think you can find options for less than $2,200/month but I'm not familiar with Boston. What kind of center is that and is home daycare available? Here infant care costs us like $1,500/month for a center. Our kids have gone through a church based preschool which costed about $1,080/month, but they don't have kids until they're about 2.5 years old. Nanny share is an option some of my friends utilized. Is that available in your area?

[Lucky Girl]

Welcome gmaninboston!  I live in Southborough, and have two kids under seven.  My DH and I had similar issues, with similar imbalanced salaries.  We've had various different child care arrangements over the last six years, and all have their pros and cons.  No child-care arrangement is perfect, so you just have to find what works best for you. 

We started with daycare at my work--45 min commute with an infant through boston traffic.  Great that I could see her during the day, but commute + inflexible hours, closure on every school holiday made it a bad choice in the end.

Nanny--first summer, while I worked 4 days per week but school daycare was closed.  Nanny was challenging to find initially, and expensive at $16/hr plus taxes, but she was great.  Biggest drawback was lack of socialization, but we never dealt with issues of sick days, etc that many of my friends have experienced with a nanny since it was just for the summer.

When I went to part-time we moved to a daycare in our town.  It is wonderful.  It is a local center with two locations, called WeeCare for Little People.  May not work depending on where you live, but we have been very happy.  It isn't cheap, but less than the major centers like Bright Horizons.  I've been back to full time for two years now, and we pay a lot for child-care but I think my kids are getting a better experience there than they would be if I stayed home full time. 

Feel free to PM me if you'd like.  Best of luck finding something that works for you!

[gmaninmass]

We are starting to look into home daycares/nanny shares.  Definitely make you more nervous because of less reviews etc...but the cost is so high for normal daycare it makes you consider more options.

[emilypsf]

Infant care at centers is much more expensive than home daycare in my high cost area (SF).  Home day cares in the city can be as low as $1600/month, and I've heard they are cheaper in the suburbs.  I looked at a few that I did not like and a few that were very nice and had great reviews.  We ended up with an au pair, which is probably not cost effective unless you have more than one kid.

[okits]

Congratulations on the upcoming baby!

I'm really depressed that with additional costs of having a kid, the path to building wealth become really narrow without me working extra jobs to make up the difference.

HCOLA, so I sympathize.  Remember that daycare costs are not forever (and infancy and pre-school stages are a very short period of time.)  Raising a child will never be without cost, but the 1/3+ bite out of your savings rate is very temporary.

And if you feel very strongly about the money, having just one child is as legitimate a choice as having multiple children, or none.

[mm1970]

We are starting to look into home daycares/nanny shares.  Definitely make you more nervous because of less reviews etc...but the cost is so high for normal daycare it makes you consider more options.

I would recommend that you ask around.  I'm also in a HCOL (California), but child care is not quite that expensive.  Well, it *can* be - probably easily $1800-$2000 a month for some centers.  A nanny will be $15-20 an hour. (so, double the center).

Both my boys have thrived in small in-home daycares.  My younger son is almost 4, and is still in his.  Of course it's run by a very good friend of mine who I met because my older son and one of her kids were in the same new-baby group.

Aside from that, my older son's home daycare was chosen because of a recommendation from a friend.  Get recommendations, and a LOT of them.  What some people like you might not.  Honestly, my older son's daycare was run by a mother/daughter team, and they were on their 2nd generation of kids (where the kids parents had gone there too).  I was have a conversation last year at my son's 9th birthday party with a friend, whose son is a friend of my son.  Childcare came up as a topic and she started talking about this HORRIBLE home daycare she visited that some friends recommended.  She started ticking off all these things she hated.  And I just zipped my lips and ended with "well, you know, everyone has to figure out what THEY want.  Everyone is different!"

Because she was TOTALLY describing my son's daycare.  I didn't tell her that.  But all the things she hated, were the things I LOVED!  (They play outside a lot.  She made homemade soup for lunch every day.  She didn't use baby wipes, used rags that she washed every night.)

Nanny shares can work too, but I've got a few friends who can't keep nannies.  They decide to move back home, or quit, or go to college somewhere else.

[gmaninmass]

Just update on my earlier post: found someone we trust who can do $9/hour 9 hours/day 4 days/week - comes out much more reasonable than the centers or a nanny. 

[Beriberi]

I am always surprised people don't give more consideration to an Au Pair.  Out of pocket cost is $375/week, with likely a few extra hundred per month for food, phone, etc.  We've had one continuously since my first was 3 months old.  There are difficulties with every child care solution, but the flexibility, reliability of the program has worked really well for us.  For one child, we could have paid less with a in-home daycare, if we could have found one that worked for us. However, we now have 3 kids and are still paying $375/week for the care that we need. Also, we enjoy the cultural exchange, and having an ambitious young person in our home.

[SimplyMarvie]

I am always surprised people don't give more consideration to an Au Pair.  Out of pocket cost is $375/week, with likely a few extra hundred per month for food, phone, etc.  We've had one continuously since my first was 3 months old.  There are difficulties with every child care solution, but the flexibility, reliability of the program has worked really well for us.  For one child, we could have paid less with a in-home daycare, if we could have found one that worked for us. However, we now have 3 kids and are still paying $375/week for the care that we need. Also, we enjoy the cultural exchange, and having an ambitious young person in our home.

I was going to suggest this! My boss used an Au Pair in DC over the summer, and while there were some challenges at the outset hiring the right person, it was a great solution. (Especially since she got someone from her home country, so her son's language skills in her first (his second) language increased by leaps and bounds.)

[La Bibliotecaria Feroz]

I am always surprised people don't give more consideration to an Au Pair.  Out of pocket cost is $375/week, with likely a few extra hundred per month for food, phone, etc.  We've had one continuously since my first was 3 months old.  There are difficulties with every child care solution, but the flexibility, reliability of the program has worked really well for us.  For one child, we could have paid less with a in-home daycare, if we could have found one that worked for us. However, we now have 3 kids and are still paying $375/week for the care that we need. Also, we enjoy the cultural exchange, and having an ambitious young person in our home.

I was going to suggest this! My boss used an Au Pair in DC over the summer, and while there were some challenges at the outset hiring the right person, it was a great solution. (Especially since she got someone from her home country, so her son's language skills in her first (his second) language increased by leaps and bounds.)

We have acquaintances that do the same thing. But my understanding is that they can provide only 25 hours of care per week--so it's not so much a replacement of daycare as an adjunct. Perhaps it varies by agency. I am not sure what our friends did when their kids were babies; I think later on the kids were in part-time preschool.

[MrFrugalChicago]

For what it's worth I knew some people in Chicago that did a nanny share. Hire 1 nanny for 2 families kids. The nanny was around 30k a year, so a share was maybe 1200-1500 per family per month. Beats a 2200 daycare in both cost and convenience, but still pricey.

[Beriberi]

Au Pair hours are regulated by the state department, as a condition of the visa - they are all* able to provide 45 hours per week, no more than 10 hours per day. The pay is $196/week, directly to the Au Pair (who is not required to pay SS, FICA), with an agency fee of around $7k/year.  Some agencies are a bit more, some a bit less, but you can't get the visa without an agency.

*There is a tiny program called educare that limits the hours more, but I don't know that anyone actually uses it.