How Much Must NPs Earn to Offset Childcare Costs?

It’s true what everyone says; having a child brings a type of love into your life that you’ve never known before. No matter how much you may love your career as a nurse practitioner, returning to work after having a baby is no easy fete. Understandably, you don’t want just anyone looking after your child; leaving your baby in the hands of a caregiver you trust certainly makes the mental battle easier. Unfortunately, child care is a big expense and one that begs the question- just how much do you need to make in order to offset the cost and is it more financially savvy for one parent to stay home instead?

How much can you expect to spend on childcare annually?

The average cost of child care depends on several factors; it varies not only by geographic region but by the form of child care, as well as the child’s age. Generally, infant care is significantly more expensive than it is for preschool aged children. In most cases, child care centers are the more affordable option, however, in-home daycares are comparable in cost. On the other hand, one-to-one care, such as nannies, are often more costly for parents but certainly more convenient for parents with unpredictable schedules such as those in healthcare.

Though it is difficult to determine given these various factors, the national average cost of childcare in 2018 was estimated to range between $9,000 and $9,600 per year, per child. At the top of the spectrum, center-based infant care in Massachusetts cost families closer to $20,415 annually. Though the cost of child care in Massachusetts is on the higher end of the national average, it is, unfortunately, the norm in over half of the U.S. states; in 28 U.S. states as well as the District of Columbia, the cost of center-based infant care is similar in cost and equates to more than the cost of one year of tuition and fees at a four-year public university.

Child Care Aware of America’s interactive Cost of Child Care map is a great tool for parents in more accurately determining the cost and affordability of child care in their own state, based on their children’s age.

How much of your income should you plan to spend on childcare?

In 2016, the Department of Health and Human Services set the standard for affordable child care at no more than 7% of a family’s income. Unfortunately, most families find themselves paying significantly more than this recommended percentage. According to Child Care Aware of America, married couples earning median incomes who have infants in a center-based child care find themselves paying anywhere from 10 to more than 12% of their income on child care.

As a general rule of thumb, financial experts advise keeping the cost of childcare down to 10% or less of your household income to offset the cost and avoid getting into hot water with the finances over child care. Bear in mind that adding subsequent children to the equation does create more of a financial strain. For example, a study in 2015 reported that the average family paid $18,000 annually for childcare for two children. Therefore, an NP and their spouse would need to collectively earn $175,000 per year to offset this cost.

If the preferred type of care you’d like to have for your child will take a considerably higher percentage of your income than the average cost is for your state, it may be more favorable for one parent to stay home or find an alternative form of care that is more financially feasible for you and your spouse. It may be beneficial to consider taking on a part time or more flexible NP position wherein you can stagger your work hours with your spouse’s schedule so one of you can be home with the children while the other works. Alternatively, some employers may be willing to provide child care assistance as a benefit to its employees. Likewise, if your workplace offers an Flexible Spending Account program, you can invest up to $5,000 annually into a dependent account which can be used for work-related dependent care expenses including the cost for childcare.

Choosing to take time off from your nurse practitioner career to raise a family is certainly a personal, yet respectable, decision. If you plan to do so, remember that it’s never too late to reenter the workforce when you’re ready. Take actionable steps by looking at licensing logistics and requirements for working as an NP in your state such as what you’ll need to do to keep your licenses and certifications active and up to date, or what you’ll need to do to renew them when you do return.