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How to Start a Daycare in Your Home: The 5-Part Guide

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Kelsey Montgomery

Kelsey Montgomery

Writer & Community Manager for FCC Providers

Now is a great time to open a home daycare. There’s more support for home daycare Providers today than ever before. And with over 1 million home daycare Providers across the U.S., it’s a growing industry that experts are calling the future of childcare.

There’s a lot to love about starting your own home daycare. You get to care for young children, teach what you’re passionate about, and help out families in your community—all while earning an income.

But starting a home daycare means embarking on a journey that involves a ton of learning and strong organizational skills to be successful.

That said, there’s never been a better time to start a home daycare. The resources you need are easier to find, and there are communities out there that’ll give you tons of support. It’s a complicated process—you’ll need to learn if you’re qualified, how much it costs, what you need, or how much you’ll make—but with the right help, you can figure it out.

We’ve helped hundreds of Providers successfully start home daycares. It’s a complex process, but we’ve broken it down into 5 important parts:


1. Getting Licensed

2. Setting Up Your Home

3. Registering Your Business

4. Finding Families

5. Launching Your Program

In this post, we’ll walk through each of the 5 different parts in detail. Keep in mind that this is a generalized overview, and that exact policies and details will vary by state.

To get the details on what exactly is required in your state, download the complete 5-Part Guide to Opening a Home Daycare. You’ll get a special copy based on where you live.

Thinking of starting a daycare?


But first, are you qualified to open a home daycare?

You don’t have to have a stacked resume or a Masters Degree in Early Childhood Education to open a home daycare. You only need real, valuable experience with infants and toddlers. For instance, many Providers are moms with young children at home. Others are early-childhood professionals who have been working with children for years.

But keep in mind that each state asks for different levels of experience. Find out your state’s requirements by downloading the complete guide.

We’re feeling confident you’ll be more than qualified for this. So let’s dive into each of the 5 parts of what it takes to open a home daycare. 


How to Open a Home Daycare in 5 Steps

Get Licensed - Start a Daycare

Part 1: Apply for a Family Child Care License

Each state’s licensing process is different. Some states do everything in an online portal. Others are still using paper and pen for everything. We recommend you download the guide so you know exactly what the requirements are.

In most states, like Massachusetts, licensing takes 2-3 months. It involves online trainings, background record checks, and a home inspection. Plus, filing a lot of paperwork with the state licensing body.

Note that in most states, a home daycare license is actually called a Family Child Care License. Licensed Providers refer to their programs as Family Child Care (FCC). It makes sense because when you’re running an FCC, all the children and parents feel like family!


Setup Your Home - Start a Daycare


Part 2: Setup Your Home

Whether you rent or own your home— when you start the licensing process, it’s important to start setting up your home daycare area at the same time. That way, you’ll be ready to go once your license lands in your mailbox!

Here are the staples of what you’ll need to successfully start a home daycare:

No Chipping Paint

Any cracking, chipping, or peeling paint will prevent you from getting your License. This goes for all indoor licensed space and any exterior surfaces that kids can reach. This is very serious. If you have any paint that needs repair, start this project immediately.

Furniture Secured

Secure any items that could fall on a child to the wall. Examples: bookshelf, television, etc.

Electrical Wires

No cords or wires that are frayed or present a strangulation risk.

Blind Cords

Tie up all blind cords so children cannot reach them.


Do all stairwells (inside and exterior) have sturdy hand railings?

Hot Water

Turn on the hot water in your kitchen and bathroom sinks. Use a meat thermometer to test to make sure it is less than 120°F. Turn down your hot water heater if necessary.

Smoke Detectors

You must have at least one on each floor of your home. This includes unlicensed areas. Also, smoke detectors should be near the nap area.

Carbon Monoxide Detectors

One on each floor of your home.

Exit Signs

Posted at each exit door.

Safety Gates

At the top and bottom of the stairs. Install any safety gates at the top of a flight of stairs. Make sure they’re not pressure-mounted.

Outlet Covers

Cover all outlets in licensed areas.

Cabinet Locks

Lock any cabinet that contains toxic cleaning supplies or dangerous objects. You don’t need to lock a kitchen cabinet with only pots and pans.

Refrigerator Thermometer

The temperature in your fridge must be between 32°F and 40°F. The EEC requires an analog thermometer for your fridge. It’s to ensure you’re storing food at the proper temperature.

Changing Table

A sturdy table that you can put a changing pad on.

Changing Pad

Some Providers like having a foam pad to hold the child.

Sanitary Paper

The EEC requires that you place a barrier between the child and the changing table.

Diaper Pail

You’ll need to toss used diapers in a locking trash can or diaper pail.

Diaper Storage

If parents are supplying diapers, you will want a place to store each child’s diapers, wipes, etc.

Kids Toilet

For any child that is potty trained.

Sink for Hand Washing

Both you and the children will need to wash your hands in a sink that is not used to prepare food.

Step Stool

So that children can reach and use the sink to wash hands.

Bathroom Door

It is important that children cannot lock themselves in the bathroom. Check to confirm that your bathroom doorknob has a safety release from the outside.

Brushing Teeth

Some states need you to brush children’s teeth. If yours does, you’ll need to store toothbrushes so that the bristles are not touching. You can buy a toothbrush holder for this.

You need to have a first aid kit. Whenever you leave your house, you must bring your first aid kit with you. You will also put a copy of each child’s Emergency Card in the first aid kit (more on this later).

Verify that your first aid kit contains all the following:

  • Adhesive tape
  • Instant cold pack
  • Gauze pads
  • Gauze roller bandages
  • Non-latex disposable gloves
  • Band aids
  • Thermometer
  • Tweezers
  • Scissors
  • CPR mouth guard


Each infant must have their own crib or Pack ’n Play to nap in. Cribs should be less than 8 years old and in good condition. They should have a US Consumer Protection Safety Commission tag. Cribs must be free of soft blankets and toys: remember your SIDS training!


Each older child must have a mat or cot to nap on.


Each child should have their own bedding, clearly labeled.

Nap Spacing

The EEC requires that there be “adequate space” between each napping child.

Kids Table

Arts & crafts are best around a table. You’ll also use these same tables for lunch time, etc.

Kids Chairs

These will be for each child that is old enough to sit at the table for activities and meals.

Gross Motor Materials

Large soft blocks and structures that kids can climb on, climb in, and get moving.

Fine Motor Toys

Smaller toys and manipulatives that engage the mind and hands. Be sure not to introduce any choking hazards! Examples: puzzles, Duplo/Lego, Oobleck, Play-doh, stuffed animals, dolls, toy cars, etc.

Sensory Activities

Water-tables; soft, textured books; pillows, scarves, etc.

Arts & Crafts

Crayons, paints, paper, glue, and more. Have a driveway? Chalk is always popular!

Dress Up / Scenario Play

Kitchen, costumes, puppets, etc.


Each child needs a place to store outdoor clothes, shoes, a change of clothes, a bag, and whatever else they bring from home. You do not need to buy an expensive set of nice wooden cubbies — a set of hooks and a simple set of shelves work just as well!


Buy a corkboard and install it near your front door. On your corkboard, post each of the following:

  • License
  • CPR / First Aid Card (for you and any assistant)
  • Emergency Contacts & Evacuation Plan
  • Covered Child Emergency Cards (On a dedicated clipboard, add a copy of each child’s Emergency Card. Be sure to use a Cover Sheet to protect this personal information.)


You’ll also need to make sure that your home will be ready for a home inspection. It’s one of the final steps to getting a license. Here’s what that includes:


For each infant and toddler.


Kid-friendly plates, cups & utensils.

Sippy Cups / Bottles

In case a parent forgets theirs.

Other things to consider when setting up your home daycare

Here are other questions you should be able to answer when setting up your home:

Outdoor Space

You should have a designated outdoor area that you can go to with the children in your program. This can either be a backyard, nearby park or both

Lead Inspection

You will need to get your home inspected for lead before you can get licensed.


You’ll need up-to-date vaccination records for your pet(s) before getting licensed. And if you have a feline friend, you need to make sure their litter box is in a room that the children can’t access.

Permission to Operate

Rent from a landlord or management company, or own a home/condo that’s part of a homeowners association (HOA)? You will need to get permission from them to operate your home daycare.

Register your Business - Start a Daycare


Step 3: Get Your Business in Order

Part of being a home daycare Provider is being a small-business owner. And home daycares are different from most other types of small businesses. To be successful, you must tie the pieces together in the correct order.

Registering your business, like getting licensed, can be different in each state. To understand what your state requires, download the 5-Part Guide for your state.


Register as a “Sole Proprietor”

We recommend that Providers set up as “Sole Proprietors.” As a Sole Proprietor, you own 100% of your business, and you pay income taxes based on the profits of your business.


Apply for an EIN

First thing is to apply for a Federal Employer Identification Number (EIN). Why do you need an EIN? First, it’s what allows the government to track your business without using your personal Social Security Number.

You’ll also need an EIN because your parents will ask you to sign IRS tax forms. This is so they can take advantage of child care tax breaks. If you have an EIN, you can provide that number and you don’t need to share your SSN with all your customers.


Keep taxes in mind

Used having your employer withhold taxes and then getting a tax refund at the end of the year? Heads up—being a small-business owner means changing how you handle your taxes.

You will have to work with a CPA to set up and pay “Quarterly Estimated Taxes.” You’ll set this up once parents are paying you on a weekly or monthly basis. Then you’ll pay based on how much profit you expect to generate in a calendar year.

It’s important to start tracking business expenses immediately. But we recommend waiting 3-6 months to sit down with a CPA to discuss quarterly tax payments. Until you have a predictable income, it often doesn’t make sense to make estimated payments.


Get insured

Your homeowner’s insurance will not cover your business. All Providers should take out a separate General Liability insurance policy. Imagine a prospective parent comes for a tour and slips on your stairs and injures herself. If they choose to sue you, you’re protected. These policies, which offer up to $1,000,000 – $3,000,000 are very affordable—around only $50/month.


Find Families


Part 4: Find Your First Families

Advertising your business before you receive your license is how you start a home daycare successfully. Today, most parents are starting their search for child care online. That’s why it’s important to have an online marketing plan. In this guide, we break marketing down into these 3 steps:


Telling Your Story

People relate to stories. And parents gravitate towards the experiences and events that have shaped your life.

Why did you get started working with young children?

Who was your most memorable teacher?

Describe a child that’s had the greatest impact on you.

The answers to these questions are what allows parents to get to know you. It’s a great way to build trust you and respect before they even meet you in person for the first time.


Spreading the Word Online

Online marketing is a technical skillset. Today, it’s easy to create a website using a platform like Squarespace or Wix.

But a website is only good if people can find it!

Google and search engines won’t find your website unless it links to other child care sites. This is why and will come up in search results before any FCC Provider’s personal website.

When we help new Providers get started, this is the online marketing playbook we use:

Parents need to be able to discover your website. They need research on your business, and, ideally, schedule a tour with you all online.

Clean up your personal Facebook profile. Everything on your profile must be appropriate for work—parents will dig around.

A Google My Business profile can help parents discover local services like yours. NeighborSchools creates and manages these profiles for all our partners.


Community Engagement

Setting up a website and developing an online presence is great for inbound interest. But when you’re launching your business, you’ll need to put some work into creating outbound interest. The best way to do this? Community engagement.

There are tons of Facebook Groups out there that parents go to when they’re actively looking for child care. A good first step is to join those groups, then do a quick post about yourself.

Mention your name, town, and capacity. Extra points if you include an interesting fact about yourself. Then, either link to your website or say you’re available for private messaging.

If you’ve already done that, then keep an eye on what’s going on in the group. Most likely, a parent near you will post asking for a recommendation. That’ll be your chance to jump in and dazzle them.

Create a handful of each and keep them on you or in your car. You can post flyers or your business cards around the area on public bulletin boards.

Put those flyers and business cards to good use. Farmers’ markets, PTO meetings, and your child’s soccer game are great places to meet prospective families.


What happens when you get an interested parent?

When you get an interested parent, the first thing you should do is offer to talk to them and schedule a tour. After that, you’ll send a contract, get their deposit, and enroll their child into your daycare.

Want more details on how the enrollment process works? Download the 5-Part Guide to figure out the best rates for your home daycare, set up banking, and more.


Launch Your Program - Start a Daycare


Part 5: Opening Day & Beyond

At this point, you should have a license and families ready to go! Excellent. But what’s next?

Once you open your program, it’s important to establish good habits early. Here are the tasks you’ll need to keep in mind on a daily, weekly, monthly, quarterly and annual basis:


You must track children’s attendance every day. You also must bring this attendance tracker with you whenever you leave the property.

It doesn’t matter no matter how easily you can count to six to ensure that you have all your children with you. If there’s an emergency, it’s important that you show that you had all children accounted for and followed response protocols.

Records of Observation

See anything out of the ordinary happen to a child during the day? Have a child who shows up in the morning with an injury? If so, it’s best practice to complete a “Record of Observation” and communicate it immediately to the parent. This is for liability reasons.

Also, keep in mind that as an FCC Provider you are a mandated reporter. You are legally obligated to report any signs of neglect or abuse of a child.

Program Plans

We recommend that Providers sit down at least once a week and plan out the next 5-10 days of activities. With a plan, you’ll be able to ensure that you have the supplies & materials you need for your planned activities. Plus, it’ll help you create more engaging and meaningful opportunities for the children.

Business Expenses

Spend at least one hour a week to do review your business expenses and add them into your accounting system. Make sure to keep receipts every time you spend money for the program.

Deep Clean Friday

Nap time is a great chance to do a deep clean. That way, you can relax going into the weekend and know that the program is going to be clean again on Monday morning! But you should note that you cannot leave children unsupervised during nap time.

Evacuation Drills

Conduct and log an evacuation drill where you and all the children leave the home and assemble at the predetermined meeting spot. You also must test your smoke detectors.

Progress Reports

Every 3 months you need to complete and share a progress report with parents.

Estimated Taxes

Once your home daycare is off the ground, you’ll need to pay your taxes quarterly. This might be different than what used to if you normally pay the entire amount at the end of the year.

Continuing Education

Complete your required hours of certified continuing education.


You must renew your pediatric CPR certificate must every 12 months.

Updated Permission Form

Every 12 months you need parents to re-sign the permission forms.

How to Start a Home Daycare

Starting a home daycare is a significant undertaking. But being a home daycare Provider is a rewarding career. Providers are pillars in their communities. They’re the glue that allows parents to work. And while parents are at work, they know that their child’s getting the love, care, and attention they need to develop and thrive.

Learn more about how to start a home daycare where you live and download the guide for your state.

About NeighborSchools

NeighborSchools helps caregivers open and run high-quality licensed Family Child Care. Since 2010, one out of every five Family Child Care Programs in the US have closed permanently, leaving families with fewer options for child care when they need it most. Child care centers charge parents too much, and pay educators not enough. Family Child Care is the solution.

We started NeighborSchools in 2018 to turn the tides and help the best educators and caregivers successfully launch their very own programs.

We are a mission-driven company, based in Boston. Want to learn more? Send us an email.


Kelsey Montgomery

Kelsey Montgomery

Writer & Community Manager for FCC Providers

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