Paying for Childcare

Jun 4, 2022

One of the many challenges faced in households, whether one-parent or two-parent, is managing the cost of childcare.

Fortune magazine reported earlier this year that, during the pandemic, average daycare costs have increased by 41 percent, which is far above the overall rate of inflation. Obviously, this challenges household budgets.

Interestingly enough, I currently work with a client who owns a childcare facility. I’ve learned from that client that, like many employers, finding quality employees in the current economy has been extremely difficult. The balance between paying enough to keep good employees and ensuring financial survival for the business without raising costs is very hard to manage. Business owners know that customers can only afford so much in cost increases.

In the case of divorcing parents, there is recognition that parents have to work, and, in order to do so, the issue of how to pay for childcare must be addressed.

In the case of divorcing parents, there is recognition that parents have to work, and, in order to do so, the issue of how to pay for childcare must be addressed. For many families, this is a changing dynamic, as many had chosen for one parent to remain at home to help raise the children while the other worked. In my mediation practice and among those parents of young children whom I know, it’s no longer exclusively a mom’s job to stay at home, although, admittedly, there are still significantly more women than men who do so.

In most divorce mediation cases, the budget to support two separate households will no longer stretch far enough on one income. In two-income households that could once afford the cost of daycare (or a dedicated childcare provider, like a nanny or au pair), the establishment of a second household often unbalances the financial equilibrium once in place.

Our legal system has a straightforward way of addressing these challenges, namely, to declare that childcare costs allowing parents to work should be divided in proportion to the parents’ incomes. For some families, especially those who prefer to have the law decide the question, this provides certainty of the outcome, but may not address the overall challenge of supporting two financially sustainable households.

In divorce mediation, we can take the time to evaluate different options that can include both how to fill the need for childcare and how to address the costs. Given the opportunity to use their own creativity, many parents rearrange work schedules to be available for their children during their designated parenting time. In some arrangements, parents are creating their own financial incentives by agreeing to take on the cost of childcare during their respective parenting time, with the understanding that, if they can adapt their work schedules, they can individually save on childcare costs.

Creative childcare arrangements are just one example of how mediation can help you see a challenge as an opportunity to develop an innovative solution, in partnership with your co-parent.