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What’s More Expensive: Childcare or Staying Home With Your Kids?

Millions of Americans ask themselves every day the important question of, can I afford childcare or

should I stay home to take care of my kids. Although it is such a large cost for most families, information

about the actual economics of the decision is hard to come by.

Many parents go through the process of deciding whether or not it makes sense to take a career break

to care for their young children, and who would do so. Michael Madowitz an economist for the think

tank Center for American Progress (CAP) and his wife were faced with this choice, he took on the task of

doing some research on the financial impact of this choice.

The results were pretty surprising, before conducting research Madowitz assumed taking a break from

work would equate to the cost of a car. Later, he came to the stark realization that it’s actually closer to

the cost of a house. Obviously, these numbers will vary from state to state but basically it’s a LOT of


The average American woman who takes a 5-year break from her career around the age of 26 will lose

out on $467,000 in income, wage growth, and retirement assets and benefits over her lifetime. On the

contrary, an average American man of the same age and time frame will lose $596,000. (Still waiting on

wage equality, sigh). A male loses a larger sum of money due to the fact that they earn more and at a

faster rate than women, and the fact that society does not expect men to take career breaks so there is

a bigger penalty. This all in turn kind of creates a sick cycle of common stereotypes, stay at home mom +

working dads. In reality, the financial implications may be pushing a lot of the choices parents have to


Now let’s get to childcare, as we all know how valuable it is not only for working parents but for growing

children . The cost for childcare is “not even close”, Madowitz says, even though you may feel

differently. We know that the cost of care is a significant chunk of a families overall income. But let’s

break it down. In Washington, D.C., childcare is most expensive in the country at $1,400 a month for a

four-year- old. At this rate, a family will pay $84,000 for five years of childcare. Seems like a lot right?

Wrong. $500,000 is the loss a parent would take if they decide to leave their job. You would end up

paying $416,000 more to stay at home and care for your child.

At Star, we understand the financial investment it takes to put your child through a Montessori

education. We want you to know that every penny counts! When your family is put through this touch

decision, really think about the financial implications of both scenarios. It turns out, you’re saving

yourself a lot of money and giving your child a head start on a great education.

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