Does Working Remote Save You Money on Childcare? Not Necessarily

A job you can do from home won't automatically spare you the expense of childcare.

A friend of mine who has been working remotely since the start of the pandemic had her first baby earlier this year. After an all-too-short parental leave, she jumped back into work from home, all the while attempting to juggle her full-time job and her newborn baby.

Not shockingly, she realized very early on that that arrangement just wouldn't work. And so now, she drops her baby off at daycare in the morning, does her job from home, and then retrieves her baby once she's done for the day.

If you're working remotely and are having a baby, you might assume that you're in for some major savings on childcare. But while you might manage to eke out a bit of savings, you shouldn't expect those savings to be substantial.

An unavoidable expense

Working remotely definitely has its benefits. Not having to commute to an office means not having to run up a huge credit card tab at the pump. And it can also make for a better work-life balance.

But if you're having a baby, don't make the mistake of assuming you'll be able to get your job done while also managing to tend to your baby's needs. That's just not realistic.

Similarly, say you have young children who aren't babies, but who aren't old enough for elementary school. If you get a fully remote job, you might assume you won't have to pay for childcare. But chances are, your 2-, 3-, or 4-year-old won't just leave you alone to work when you need to. Rather, your child might interrupt constantly, asking for everything from meals to bandages to attention. And that could, in turn, impact your job performance and compromise your employment status.

A better bet? Plan on paying for childcare for young kids or a baby, even if you'll be working from home full-time. You might save a little money by virtue of needing fewer hours of childcare in the absence of a commute. But you should definitely be sure to factor the cost of childcare into your budget.

A good way to save on childcare

It's hardly a secret that childcare is expensive. But if you have to pay for it, make sure to sign up for your company's dependent care flexible spending account (FSA).

Many people are familiar with healthcare FSAs, where you set aside pre-tax dollars to pay for things like medications and copays. Well, there's a childcare version of that, and it pays to take advantage if you have to spend money for someone to look after your kids.

Similarly, there's a tax credit called the Child and Dependent Care Credit, and its purpose is to put some money back in the pockets of tax-filers who pay for childcare so they can work. Be sure to look into these options if childcare is an expense you're forced to grapple with. But just as importantly, be realistic about your childcare needs if you're working remotely so you don't wind up putting your job on the line, or stressing yourself out to an unhealthy extreme by trying to do it all.