Dave Ramsey Tells Man And Wife Spending $80,000 A Year In Child Care Costs That They 'Have Lost Their Minds'

It's no secret that having children costs money, but a couple who sought advice from Dave Ramsey is battling to fund their lifestyle due to incredibly high child care costs. Here's what personal finance expert Dave Ramsey had to say about these costs. 

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Raising children in the U.S. is certainly not a cheap endeavor, and the costs associated with child care have risen over the years. For example, Bankrate reported that in 2015, the estimated cost of raising a child (from birth to 17 years old) in the U.S. was around $233,610. Due to inflation driving up prices, the amended costs are now $313,939. Child care is one of the largest expenses parents must fork out of these amounts. For example, back in 2021, The U.S. Treasury Department released a report that found that center-based child care costs an average of $10,000 annually, while home-based care costs around $700 per week. So, raising children in the country requires parents to be financially prepared and responsible for spending their money on child care. 

One such couple who are out of touch with child care costs sought advice from Ramsey and co-host Jade Warshaw. Dave, a man from Philadelphia, revealed to the finance experts that he and his wife are paying a whopping $80,000 a year for their kid's day care and to hire a nanny in the summer. He explained that he was battling to pay for this child care. With his wife still in medical residency with two years to go, their combined salaries amount to $180,000 annually, and Ramsey is shocked that they're struggling to live off that amount. Ramsey gets fired up as he exclaims, "Oh, come on. A $180,000, and you will explain that with child care costs?" When Ramsey learns how much Dave and his wife spend on child care costs, Ramsey exclaims, "Why? You bought them a college?" 

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To put this $80,000 on child care costs into perspective, this is an amount paid for Ivy League schools. For example, Statista revealed that the annual cost to attend Columbia University is $69,045. So, right now, Dave and his wife are paying close to or more than what it costs most people to attend college. Dave breaks down his costs. Currently, they're paying a base of $25,000 per kid for child care tuition, plus extra for early and aftercare. This excludes money spent on child care costs during the summer holidays.   

Ramsey responds, "I'm going to be as nice as I can, Dave," and continues, "You guys have lost your minds." Warshaw agrees with Ramsey and tells Dave there are cheaper routes they can take for good quality child care. Ramsey, who's still shocked by the money spent by this couple, exclaims, "I mean, are they going to Harvard? What the crap?"

"I don't care how much money you make. There's not enough money in the world that doesn't make that stupid," Ramsey said. 

Warshaw told Dave that an alternative to save them money during the summertime is to find a free summer camp. Warshaw explains to Dave that while day care is expensive, it doesn't have to be as expensive as he's currently paying. There are options for other parents like Dave who are struggling to finance child care costs. For example, depending on their income and the age of their children, parents may be eligible for child care tax credits. Parents can check if their employers include benefits like child care subsidies and on-site day care centers at a discounted rate or even offer a flexible spending account. 

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