has anyone taken a financial loss for childcare to keep their job because....

[clarkfan1979]

I never paid for childcare, but I hear that it can be expensive.

I have a friend that ran a large commercial pre-school/childcare facility for about 15 years. She would occasionally have to tell some families that they don't make enough money to pay for the childcare center. It would make more financial sense for them to stay home and provide their own childcare.

I was just curious if anyone liked their job enough to still take the financial loss, if their after-tax income didn't cover the cost of their childcare. Or maybe you wanted to avoid a disruption in your career. Maybe your job didn't fully cover the cost of childcare in the beginning, but you expect your salary to increase in the near future.

[MaybeBabyMustache]

Not exactly, but with two small kids in childcare (mine are 13 months apart), it was close for a period of time. I kept working for a variety of reasons:
-Benefits (my health care plan was substantially better than my husbands)
-401k match - I was able to keep putting money away for retirement, at a relatively young age, vs trying to catch up when the kids were older & I was back to work
-My salary did indeed increase substantially (an unusual case, but more than 6x since I had my first child)
-I'd recently finished my MBA, and didn't want a large gap between degree completion & my next job
-I knew it was a period in time, and we could afford it. My career had a lot longer time horizon/future than the few years when it was tight
-I'm not super attached to being a SAHP, particularly during the infant phase. I knew I'd prefer to be at home when the kids were older, and, IMO, needed me more. I'm about to FIRE in the winter, and I'll have a 9th & 10th grader. I personally wanted to put in the career effort during my younger years, and then be able to exit as I was older

[StarBright]

We did.

My husband's first couple of years out of grad school he made about 22k and 30k (pre-tax and work related costs) and our childcare at that time was 34k and then 30k respectively.

But it was the wrong time to step out of the work force for him and our long term plan was for him to eventually be the main job because he's passionate about his work.

It was crazy tight. We started with a large emergency fund but between childcare and the natural disasters that come in life we were down to about $200 in non retirement savings at one point. One more emergency would have been scary and we would have been contemplating some hard decisions.

We lucked out and it all worked out for us: he landed a full time job, we haven't hit our Max our of Pocket on health insurance since the year after my youngest was born and we've been on the up and up ever since.

Next year should be the year that his job becomes our primary income (or at least, mine won't be as necessary any more).

[GuitarStv]

We ran the numbers putting our kid in daycare.  (Daycare in Toronto is really fricking expensive.)  My wife and I are both engineers, and it worked out that it was worth it for both of us still going to work.  Break even point would have around 70% of salary though . . . so it was closer than I thought it would be.

[slappy]

Personally, I think it rarely makes financial sense to have a SAHP to avoid child care costs. I think its more of an emotional/value driven decision that anything. (Disclaimer: we have three kids and a SAHP.)

[Metalcat]

I've known many people who have done this so as not to destroy their career trajectory.

[CodingHare]

No kids here, but if we did have one, I would absolutely take a loss on childcare to keep my job.  It's unlikely that I would have to (even in this HCOL area my salary would cover it alone.)  But it's more about not wanting children to define my entire life trajectory.  My mom has no identity other than being a mom.  That scares me, and I will throw money at that problem to not end up in the same place.

And that's 100% a personal decision, my mom has no regrets about her life and would choose the same thing.  I just don't like young kids the way she does, and I am fiercely protective of my identity as a person and not just a wife/potential mother.  Different people, different priorities.

I also suspect I would be a better mom for having dedicated non-kids time, which is better for the theoretical kids.  I also am super on the fence about having those theoretical kids, so it probably won't even be an issue for me.

[youngwildandfree]

Personally, I think it rarely makes financial sense to have a SAHP to avoid child care costs. I think its more of an emotional/value driven decision that anything. (Disclaimer: we have three kids and a SAHP.)

Do you mean long term based on expected career trajectory? Even if both parents make more than the childcare cost, most families I know with SAHPs save tons of money due to reducing the expenses associated with both adults in the house working full time.

[srrb]

I've known many people who have done this so as not to destroy their career trajectory.

Yep, me included. Had a nanny for almost a year while I waited for spots to open up at a daycare centre. I had to work or would lose my license for lack of practice hours after two close 12-month mat leaves. It was lovely and worth every penny -- but not sustainable once I had other options.

[chasingthegoodlife]

Our goal is to both work part time to achieve a SAHP effect while both keeping ‘a toe in’ the workforce.

We both work in the community sector where part time jobs are comparatively plentiful - I can see other fields might have fewer PT opportunities.

I’ll tell you in 5 years or so whether that actually worked!

[Morning Glory]

Personally, I think it rarely makes financial sense to have a SAHP to avoid child care costs. I think its more of an emotional/value driven decision that anything. (Disclaimer: we have three kids and a SAHP.)

We chose SAHP for financial and logistical reasons rather than values. At the time our first was born I worked rotating 12 hour shifts (7a-7p or 7p-7a, 3 days a week, every third weekend) and my husband worked 3-11 M-F. He did not want to get a different job that was more daycare-friendly. My hourly pay was 3x his so he went part time and worked a couple days per week on my days off, so one of us was always home. After I took on side hustles and the second kid came along he pretty much stopped working but would occasionally fill in to cover sick calls, etc. That lasted until Covid came along and they weren't being safe so I told him it was totally ok if he quit.  I am currently in a job that would work with daycare, plus our oldest is in school now, so I asked him again if he wanted to work and he said he wants to wait until after I FIRE. 

[okits]

Yes.

We have access to an excellent childcare centre, and both my children responded very positively to having a consistent group of peers to learn and play with, with professional educators who planned a well-thought-out curriculum and well-stocked classroom.  Both started daycare at 18 months. 

My first year back in the workforce after Kid2, daycare cost more than I earned.

Here's the thing: daycare centre spots here are most expensive when the kids are really young.  My pay hasn't risen much but our daycare costs keep falling as my kids get older.  They're below what my job pays, now.

There's also the aspect that neither of us wanted to be full-time SAHPs.  My job is important for non-monetary reasons.  Finances are only one consideration when deciding whether you'll pay for childcare.

[Weisass]

Yes. I downshifted for a few years while my kids were really little. And while there were times that I was frustrated that I couldn’t be full time, I’m glad I stayed connected to my profession and my toe in the door. It can be so much harder to advance when you are fully absent for a season.

[JJ-]

This is one of those things where it should be a financial decision for some and does not have to be for others.

My guess is that a majority of the families that your friend had to talk to were not as mindful of their income situation and needed to be told it was not a good idea to do child care.

However here you will likely find more folks long term oriented financially or more stable, thus knowing the impact going negative short term can be offset by saving or future earnings.

I wonder how many families said thank you to your friend but we'd still like to do it, whether they were financially able to or not?

Before we had kids, DW and I decided that yes we would go cash flow negative for daycare years if needed to allow DW to keep working. A) I was high earner and physically could not do child rearing. B) she really liked her job. C) she needed something other than kids to talk about with friends, a majority of whom did not have kids. D) long term employment prospects were higher staying in the workforce.

[calimom]

I had a period of almost 2 years where it actually cost money to go to work every day - it was like an expensive hobby. Between purchasing a business that had monthly payments and having my youngest child in Montessori, it was a negative cash flow situation. There were other options for childcare that were quite honestly crappy, and the high-quality center was a far better fit. The opportunities for peer-group play, art, music and nature study were valuable.

In the end, I was pleased I took the long view on this, as opposed to the short term thinking. It was better for my career, my daughter's happiness, and learning, and our family's overall well-being.