Written by Robert Thompson III | 1/18/21

Since the pandemic closed schools and daycares for millions of families in March, as a result, this transformed working parents into caretakers and teachers. The child care crisis finally hit us and gave a collective consciousness. Should we spend more time with our children? This has been by far the best thing to come out of this pandemic. The pandemic exposed a worldwide emergency for low-wage child care who found themselves out of a job as their employers closed. 

A recent survey of California providers by the CSCCE (Center for the Study of Child Care Employment) discovered that 77 percent of child care companies have lost income because of the pandemic. 80% percent of them have more expensive costs associated with cleaning requirements. Many providers fear getting the corona at work however, they can’t afford to close down not even for a short period of time.

Boost workers pay

A survey earlier this year found that 30% percent of centers would have to shut down permanently if forced to close for two weeks or more. To help child care providers like Carreno stay in business many professionals have called for a bailout of the child care industry, estimating that providers around the country need about $50 billion to keep paying their expenses between lower revenues and potential temporary closures.

Now President Joe Biden has made such a bailout part of a larger proposal which also includes provisions to boost workers’ pay and strengthen their power to unionize to help America’s caregivers. “If we truly want to reward work in this country, we have to ease the financial burden of care that families are carrying, and we have to elevate the compensation, benefits,  and dignity of caregiving workers and early childhood educators,”  Biden 

said on Tuesday during a speech announcing the plan. 

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  Biden’s Plan

Firstly, after having kids you will notice money starts sinking if you don’t have a budget 

plan. According to Care.com, about 55% of families in the U.S. say they spend around 10,000 dollars a year on childcare. For example, Most families spend $565 a week on nannies and $215 a week on daycare. Therefore, some parents even had to quit their job to have full attention to kids. The more kids parents have the more money they need to spend on them. Joe Biden wanted to help the situation and make childcare more affordable. As a result, the President is sending $15 billion in funding to the childcare and development block grant program. Biden wants to expand the Child Tax Credit, and it is currently worth 2,000 per child under the age of 17.

Child Tax Credit

In fact, he also plans to boost the Child Tax Credit to 3,000 per child, and 3,600 per child under the age of six. Therefore, he’s looking to make Child Tax Credit fully refundable. Currently, the Child Tax Credit is only partially refundable. Up to $1,400 can come back to tax-filers in refund form. Furthermore, If a given tax-filer does not owe the IRS money they’ll only get $1,400 per child. The Child Tax Credit is only for parents of children under the age of 17. It doesn’t matter if they’re paying or not. The Child and Department care give a maximum of $1,050 per child under 13 and 2,100 for 2 or more children under 13. The President’s wanted to boost it so it’s worth $4,000 dollars for one child and $8,000 for 2 or more children.

The credit will also be available to families earning up to $400,000. This speaks to the fact that childcare can be a burden even for higher earners with multiple children. And, it will be refundable. 

Conclusion

Child care in America has not worked well with anybody even before Covid-19. It hasn’t worked particularly well for children or for parents and not even for the people who are providing services and working in these programs. For most families, child care is unaffordable, costing around 11 hundred a month in many states. It is also very expensive to provide. Quality care requires low caregiver-to-child ratios and strict safety protocols, even in normal times. Even with fees that are unexpectedly high for many parents many programs still struggle. They have little cash on hand for emergencies, and they often pay staff poverty-level wages and offer no benefits. Child care workers nationwide make an average hourly wage of just $10.82, and some earn far less.

More than half rely on some form of public assistance to get by, and they’re more likely than other workers to lack health insurance and paid sick leave.

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Wealth Tip

Entrepreneurs can pay their child up to $12,500 as a deduction for the business and tax-free income for the child Here’s how 👇 

1. Child under 18

2. Child has a separate account 

3. Create a job description

4. Reasonable wage

5. Keep good records of the work

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