How Much Does a Home Daycare Provider Make?

How much money do you make running a home daycare?

There are a handful of factors that can affect how much a home daycare Provider makes. Here are the most common ones:

1. Location

Where you live matters. Ideally, you want parents nearby who are willing to pay for high-quality child care. We tend to see that the more populous an area is, the more competitive the child care market. Usually, Providers in these markets can set their rate at least 1.25x more than their rural counterparts. 

But if you live in a more rural area, you might find that it takes more time to fill your open spots. Plus, your pay might not be as high as someone who lives in a higher income area like the city or suburbs. 

2. Capacity

New Providers usually start with a license for up to 6 kids—with some rare exceptions. This is the case in Massachusetts, and other states have a similar policy.

But when we say “up to 6 kids”, this means you can only have six enrolled kids at a time in your daycare space. Most of our Providers who have a license for 6 actually have more than 6 kids enrolled. How? As you’ll see in our real-life examples below, they take on a bunch of part-timers! 

It’s typical to charge a higher daily rate for part-time children than you would for those enrolled full-time. By mixing and matching enrollments to your licensing capacity, you can make more money and serve more parents in your community.

As you grow in your career as a Provider, you can request to increase your capacity to 8 or even 10 children. Higher capacity = more revenue.

3. Age Ranges

If you’re a parent, you probably know that child care for an infant costs more than it does for a preschooler. That’s because an infant requires constant attention and care. But that can also mean increasing resources and hiring an extra set of hands to help out, which can raise your operation cost. 

A preschooler usually doesn’t need as many resources, which can be less stressful and less costly, but they typically don’t bring in as much revenue.

Below you’ll see that Providers usually have different rate tiers for infants (8 weeks to 14 months), toddlers (15 months to 2.8 years), and preschoolers (2.9 to kindergarten). 

Your daycare’s age range is your preference. We know Providers who love working with 1 or 2 infants at a time. We know others who enjoy having a daycare full of older kids of the same age. Either way, your daycare’s age range will influence your revenue.

4. Your Own Children

So many Providers start a daycare to spend more precious time at home with their own little ones. It’s a huge perk of the job, plus it helps you put the money you would’ve spent on child care into your own pocket.

But if you think about capacity, each kid of your own in your daycare will take a full-time spot.  It’s something to keep in mind when trying to figure your potential revenue. 

5. Expenses

Starting a home daycare is an investment. To get up and running, you’ll have to buy furniture, supplies, sensory materials, books, and more. If you leave it there at the basics, the typical home daycare startup cost is about $3000. But some Providers invest even more by repairing or renovating their homes, which can add hundreds or even thousands of dollars to your startup budget.

This is all to say that if you put money into starting your daycare, it might take some time to break even. By keeping it simple in the beginning and spending around $3,000, you should be able to break even after your first month of having a few enrollments.

How Much Did Home Daycare Providers Make in 2021?

Now for the fun stuff! We’ll walk through what 3 different Providers actually made in 2021, broken down by enrollments and location, so you can see how it all works.