Infant care costs roughly 10% of a family's annual income in nearly all states, study finds
FILE-Day care workers care for kids at a center. (Photo by Anne Cusack/Los Angeles Times via Getty Images)
Child care expenses can add up and absorb a significant amount of a family’s income.
Bankrate, a personal finance company, released a new study revealing that child care costs are one of the biggest expenses in household budgets in the U.S., with infant care costs topping 10% of the median family income in 48 states and the District of Columbia in 2023.
RELATED: Child care now costs more than a mortgage, study finds
The report also compared other household expenses and noted that child care for one infant costs $14,070 on average, which is more than a household's average annual budget for food ($9,985 per year), health care ($6,159) and transportation ($13,174).
New Mexico was the state where infant care was the least affordable, accounting for 20.5% of the median family income, or roughly $13,521 in a year out of an income of $65,952, according to Bankrate's study.
What states have the least affordable child care costs?
- New Mexico, 20.5%
- Hawaii, 20.1%
- New York, 19.6%
- California, 18.7%
- Massachusetts, 18.4%
Which states have more affordable child care costs?
- South Dakota, 8.7%
- North Dakota, 9.8%
- Utah, 10.3%
- Idaho, 10.9%
- South Carolina, 11.2%
Despite those states having relatively affordable child care, Bankrate, citing a report by ReadyNation, noted that aside from North Dakota, each of the four states have higher numbers of "child care deserts" where it's challenging to find affordable child care.
RELATED: Child care costs are now rising at twice the rate of inflation, report finds
According to the study, the item that costs households more than child care on average is housing expenses, which have an average cost of $25,436 per year.