How will we add childcare to our budget?

What to consider: Be strategic about your childcare options.

According to a recent survey by Care.com, the average weekly cost for an infant child in a daycare center is $213. By comparison, it’s $199 for a family care center and $580 for a nanny. As a freelancer, I’m lucky to have the flexibility that some other full-time jobs don’t afford, but I was still going to need childcare.

Luckily, there are a few things that can help curb the costs: According to a Zenefits survey, 67% of respondents reported that their small business workplace offered some degree of flexibility with regard to scheduling, hours worked or remote days. Pooling resources with nearby parents is another way to save. My neighbor and I are considering going in on a nanny share when she returns to work, which could help us cut the costs of childcare for our combined three children.

How to budget:

While everyone’s situation is different, if childcare costs are eating up a majority of your income, Dixon suggests looking at alternative options. “Look at the percentage of income that will be going to childcare,” she said. “Is it worth the expense for both parents to work if all of one parent’s income is going to childcare?” If the answer is yes, at least you might have some choices, listed above, to reduce some of the cost.

How can I possibly save enough for college?

What to consider: Saving for college is a big expense, but there are benefits, too.

According to the College Board’s 2018 Trends in College Pricing Report, from 1988 to 2018 sticker prices tripled at public four-year schools and doubled at public two-year and private non-profit four-year schools. Don’t panic, though. You have 18 years to save, and there are scholarships and work-study opportunities available. Also, there is the powerful option of starting a 529 college savings plan for your child; notably, the investment income earned within a 529 plan is tax-deferred.

How to budget:

Consistently saving even a small amount now can make a big difference in the future. “If you start a 529 college savings plan when your baby is born and begin saving just $50 a month until they turn 18 years old, your child could have almost $20,000 saved for college, assuming [for example] a 6% rate of return,” said Dixon. Remember, friends and family can contribute to your child’s 529 plan as well — so don’t hesitate to suggest they do so in lieu of yet another outfit.