Finance

• Child Care and Development Fund– (CCDF) provides assistance to low-income families who need child care due to work, work-related training and/or attending school. In 2012, $5.2 billion was allocated to this fund. The program aims to  improve the quality of child care, and promotes coordination among early childhood development and after-school programs.
  
• Flexible Spending Account– (FSA) is a special account you put money into that you use to pay for certain out-of-pocket health care costs. Since you don’t pay taxes on this money. you’ll save an amount equal to the taxes you would have paid on the money you set aside. How does this help: If your job offers an FSA, you can put aside up to $5,000, which is the family limit, in pre-tax dollars to pay for child care expenses. This fund could get as much as $2,000 in tax savings if your combined contributions reach the maximum.
• State Assistance– Each state receives funds from the federal government for their state’s child care fee assistance program. Click here to find the contact information for your state. Many of the subsidies have strict income and age limit guidelines, however exceptions can be made for children with a disability. You can find your state’s child care subsidy website on this State by State Resource Map. See below for some examples of specific State assistance programs and grants that are available:
  • Washington: The Child Care Subsidy Program– helps families to pay for quality child care through either the Working Connections Child Care, or Seasonal Child Care.
  • Nebraska: Children’s Cabinet–  is a financial assistance program that can refer families to providers, help them apply for subsidies, and can even help families who want to pay a relative for care.
  • North Carolina: Smart Start is a public/private partnership with the goal of promoting high quality early care that is child-focused, family-friendly, and fair to providers. For years, Smart Start subsidy funds have been used to increase the quality of early child care and education in the state.
• Head Start Programs– Comprehensive child development programs which serve children from birth to age 5, pregnant women, and their families. They are child-focused programs and have the overall goal of increasing the school readiness of young children in low-income families.
• State Funded Pre-K– More states than ever are providing publicly funded preschool. Some states offer Pre-K programs at low or no cost to eligible families, while other states have made pre-K available to all families. Your local Child Care Resource and Referral agency (CCR&R) can tell you if your state funds pre-K for some or all families.
• Military and Dod Families–  Child Care Aware® of America offers child care fee assistance to eligible members of the military and DoD. Eligibility requirements are determined by each branch of service or agency. Visit Child Care Aware® of America’s website to find out if your branch or agency is covered

The “529 Plan”

A 529 Plan is a savings plan specifically designed to help families set aside funds for future education. They are operated either by the state or an educational institution, and studies have shown that parents who use a 529 plan are significantly more successful at saving than those who don’t. Additionally, there are three types of 529 plan for you to choose from:

• 529 Savings Plan: This is similar to a 401(k) or a Roth IRA, and your financial contributions are invested into things like mutual funds. 
• 529 Prepaid Tuition Plan: This plan allows you to pay the cost of in-state college tuition in advance. If your child decides to go to school out of state or to a private university, the money from that plan can be transferred. In some states, however, the full amount can’t be transferred, so look at the rules in your state before setting up your plan.
• Private 529 Plan: This plan will allow you to pre-pay the cost of tuition for participating colleges or universities at today’s prices. This will be particularly useful considering the constantly rising costs of tuition.