4 ms·

Can you break down the aspects of childcare that are financially crushing?

Balgair 3y ago
Not OP but: Near me the cost of daycare is ~$500/wk, so ~$26k per year per kid. No discounts for multiple children. Median income in my area is ~$40k per year. There are a fair few state and local discounts for people near the poverty line, but things get complicated, as usual. Other aspects get rolled up into the financial costs of childcare, and they are not negligible at all, but daycare is typically the largest issue by far. As in, just solving daycare won't fix the issue. Also, daycare costs change a lot depending on location. I have friends in TN that are at ~$1000/wk and friends in the Bay Area at ~$400/wk. So the local CoL seems to have a smaller impact than you'd think. But yeah, daycare, man. You have to square that circle somehow. Like, you know the 80/20 rule? Kids are not like that. They're more like an eclipse. In that, there is a big difference between 99% and 100% of totality. With kids, you're not going to get a movable effect with just addressing 20% of the issues. You really gotta address all of the problems to get the needle moving. That's not a popular thing to say in government, because that means that kids are expensive things to try and fix and that little victories really don't matter all that much.
- brewdad 3y ago
  The little victories matter in the same way that the Snowball Effect works for paying down debt. It feels good to see marginal improvements and those improvements allow for even greater improvements in the future. The problem comes when we stop at the first improvement or use that as an excuse to not fix new problems as they arise.
  - Balgair 3y ago
    Nah, I disagree. From where I'm at, the little victories do not add up or 'scale' in SV parlance. (Now, granted, I'm focusing on increasing a country's birthrate here, not on individuals. That's a separate discussion than the one I'm having in this comment) Like, we see in the data that these very expensive little programs and attempts to get the birthrate up seem to not really get more babies out there. In fact, it seems that the more that a family has coming in, the less kiddos they have. From my seat, what I see is that governments are trying to do these very expensive 20/80 rule kinda things. Stuff like 1.5 years of parental leave, Nordic birth boxes, free school meals, etc. Many countries are doing all this kinda stuff at once, sorta, for a little while. And it's not really seeming to move the needle much all the same. That's kinda my point. It's not that you can do a program here and see a spike in birthrate, or an initiative there and see another spike. Birthrates and having kids is a whole circle thing where, I think, you're only really going to get a real change in the birthrate if you do a lot of these very expensive programs all at once. The snowball effect does not work with birthrates, I think. You gotta do avalanches. And yeah, that's a near impossible thing to make happen without tyrannical power.
wharvle 3y ago
1) The costs are heavily front-loaded. This makes the opportunity cost enormous. 2) I think we paid about $10k per birth, total. That’s not nothing. 3) Health insurance goes up. Kids are cheap but it’s still a couple thousands more per year. Plus hundreds to low-thousands per year in other healthcare spending per year (averaged—we’ve had $5k years and $1k years) 4) … Except having kids is a reverse lottery ticket for each one, and the healthcare & related costs could end up being “most of your money, forever”, if you’re unlucky. 5) Childcare costs are either $500-$thousands per kid per month (unless you’ve got relatives who are cool doing that all the time) or the entirety of one parent’s foregone compensation for the same span (five to six figures a year for most folks) 6) Housing. Unless you can’t afford it, you’re gonna find it very hard to settle for cheap housing in a bad school district. The premium in our area for a good vs. mediocre (not even the awful, horribly dangerous ones!) district is about 35-40% for a similar house. That’s… a fuckton of money, and the difference is likely to be 100% financed for folks around having-kids ages. Everything else is basically negligible compared to healthcare, daycare, and housing, or can be made very cheap with minimal sacrifice. Child related expenses were often over 50% of everything leaving our bank account, for months on end, when our kids were younger.
phatfish 3y ago
Because it is very likely to be the biggest expense you will have apart from rent/mortgage payments. In the UK it is easily 50% of the take home pay of one parent if they are on a "good" above average wage. It will soak up the the full take home pay of one parent on an average wage or around that. There are government funded childcare hours (that are increasing finally) which help, but it's still a tough choice unless both parents have earnings well above average. Families get spread out because children are priced out of where their parents live, and can only afford a small home. So the grandparent support is often hard to make work too. I find it curious that the type of people that moan about low birth rates and the loss of "family values" are also the ones voting for politicians that block house building and impose spending cuts on government services like childcare. Not having children in the current political climate is a rational choice.

Not OP but: Near me the cost of daycare is ~$500/wk, so ~$26k per year per kid. No discounts for multiple children. Median income in my area is ~$40k per year. There are a fair few state and local discounts for people near the poverty line, but things get complicated, as usual. Other aspects get rolled up into the financial costs of childcare, and they are not negligible at all, but daycare is typically the largest issue by far. As in, just solving daycare won't fix the issue. Also, daycare costs change a lot depending on location. I have friends in TN that are at ~$1000/wk and friends in the Bay Area at ~$400/wk. So the local CoL seems to have a smaller impact than you'd think. But yeah, daycare, man. You have to square that circle somehow. Like, you know the 80/20 rule? Kids are not like that. They're more like an eclipse. In that, there is a big difference between 99% and 100% of totality. With kids, you're not going to get a movable effect with just addressing 20% of the issues. You really gotta address all of the problems to get the needle moving. That's not a popular thing to say in government, because that means that kids are expensive things to try and fix and that little victories really don't matter all that much.

brewdad 3y ago
The little victories matter in the same way that the Snowball Effect works for paying down debt. It feels good to see marginal improvements and those improvements allow for even greater improvements in the future. The problem comes when we stop at the first improvement or use that as an excuse to not fix new problems as they arise.
- Balgair 3y ago
  Nah, I disagree. From where I'm at, the little victories do not add up or 'scale' in SV parlance. (Now, granted, I'm focusing on increasing a country's birthrate here, not on individuals. That's a separate discussion than the one I'm having in this comment) Like, we see in the data that these very expensive little programs and attempts to get the birthrate up seem to not really get more babies out there. In fact, it seems that the more that a family has coming in, the less kiddos they have. From my seat, what I see is that governments are trying to do these very expensive 20/80 rule kinda things. Stuff like 1.5 years of parental leave, Nordic birth boxes, free school meals, etc. Many countries are doing all this kinda stuff at once, sorta, for a little while. And it's not really seeming to move the needle much all the same. That's kinda my point. It's not that you can do a program here and see a spike in birthrate, or an initiative there and see another spike. Birthrates and having kids is a whole circle thing where, I think, you're only really going to get a real change in the birthrate if you do a lot of these very expensive programs all at once. The snowball effect does not work with birthrates, I think. You gotta do avalanches. And yeah, that's a near impossible thing to make happen without tyrannical power.

wharvle 3y ago

1) The costs are heavily front-loaded. This makes the opportunity cost enormous. 2) I think we paid about $10k per birth, total. That’s not nothing. 3) Health insurance goes up. Kids are cheap but it’s still a couple thousands more per year. Plus hundreds to low-thousands per year in other healthcare spending per year (averaged—we’ve had $5k years and $1k years) 4) … Except having kids is a reverse lottery ticket for each one, and the healthcare & related costs could end up being “most of your money, forever”, if you’re unlucky. 5) Childcare costs are either $500-$thousands per kid per month (unless you’ve got relatives who are cool doing that all the time) or the entirety of one parent’s foregone compensation for the same span (five to six figures a year for most folks) 6) Housing. Unless you can’t afford it, you’re gonna find it very hard to settle for cheap housing in a bad school district. The premium in our area for a good vs. mediocre (not even the awful, horribly dangerous ones!) district is about 35-40% for a similar house. That’s… a fuckton of money, and the difference is likely to be 100% financed for folks around having-kids ages. Everything else is basically negligible compared to healthcare, daycare, and housing, or can be made very cheap with minimal sacrifice. Child related expenses were often over 50% of everything leaving our bank account, for months on end, when our kids were younger.

phatfish 3y ago

Because it is very likely to be the biggest expense you will have apart from rent/mortgage payments. In the UK it is easily 50% of the take home pay of one parent if they are on a "good" above average wage. It will soak up the the full take home pay of one parent on an average wage or around that. There are government funded childcare hours (that are increasing finally) which help, but it's still a tough choice unless both parents have earnings well above average. Families get spread out because children are priced out of where their parents live, and can only afford a small home. So the grandparent support is often hard to make work too. I find it curious that the type of people that moan about low birth rates and the loss of "family values" are also the ones voting for politicians that block house building and impose spending cuts on government services like childcare. Not having children in the current political climate is a rational choice.