First Person: I’m Not Taking Out Loans for Child Care

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You know things must be getting tough for the middle class when they're having to take out loans for childcare. According to CNN Money, "Child care is so expensive in New York City that City Council Speaker and mayoral frontrunner Christine Quinn is launching a loan program to help middle-class parents pay for daycare."

The article goes on to note that, "Parents with children aged two to four will be able to receive loans of $11,000, at a 6% interest rate. Applicants must have an annual income of between $80,000 to $200,000, and a credit score of at least 620, according to Quinn's office."

Our family has two small children, but we're certainly not taking out loans for childcare. While I'm lucky enough to be able to work from home; therefore, handling childcare duties as well, we're opting to find savings in other ways too.

Cutting costs on clothing…and even making some money back

Food and clothing can be some of the greatest regularly occurring expenses for kids. And when it comes to clothes, kids can ruin or outgrow these items before they've hardly had a chance to wear them. This is why we choose to shop resale for a large majority of our clothing purchases. From shirts and pants to snow suits (since we live in the Chicagoland area) and jackets, we tend to get lightly worn and often even brand name attire for pennies on the dollar.

While we still buy things like socks, shoes and undergarments new, in this way, our annual clothing budget for our two kids (ages six and one) tops out at between $100 and $200 per year, and for our family of four at about $300 to $400. Meanwhile, a TLC.com article notes that, "A North Dakota State University study from 2010 found that the average American household spends about 3.8 percent of their income on clothing. The Census Bureau states that the average household income is about $50,000 per year, so that means roughly $2,000 per year, per household."

But we don't just leave it at great savings; we take it a step further. Certain items that we don't have an opportunity to use or that has hardly been worn we take to the resale store Once Upon a Child. This store purchases lightly worn or used kids' items. We recently took some clothing and a baby swing there and came back with $38 in hand. What the store didn't take, we'll put in a garage sale, and what doesn't sell there we'll donate to charity.

Baby savings

We've gotten pretty good at finding ways to save on baby costs over the years. Two of the most significant products upon which we cut costs come by way of diapers and formula. Going brand name for these items can get expensive in a hurry. Heck, they can be costly even as store brands. However, by doing our shopping for these items at places like Target and Walmart, and using their store brands, we can often cut $5 to $15 per container off the price compared to name brands. This adds up to hundreds of dollars per year in baby savings.

Add to this our savings from using leftovers like clothing, toys, and furniture from first child that we thankfully saved just in case and due to sentimentalism, and we've added additional hundreds of dollars to our baby savings.

Summer savings

Having kids at home during the summer can lead to boredom, which in turn can lead to extra family costs. Camps, sports, daycare, and other organized activities can add hundreds or even thousands of dollars to a summer budget. This is why our family looks to cut costs during this period when kids are off from school and looking for fun.

We tend to visit parks and recreational areas where fees are nominal or nonexistent. We take time to visit and play at grandma and grandpa's house, and we vacation at spots where family members live so that we save on accommodations. Sometimes we even take advantage of staycations at home. In these ways, we keep our summer costs low while still keeping the kids entertained and having a good time.

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Disclaimer:

The author is not a licensed financial professional. The information provided in this article is for informational purposes only and does not constitute advice of any kind. Any action taken by the reader due to the information provided in this article is solely at the reader's discretion.

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