Different types of fees at your childcare center are all necessary parts of running a childcare business. While childcare is an essential and rewarding career, it doesn’t happen for free. You and your staff need to get paid.
That said, childcare fees are not greedy or “bad.” They’re simply a way to account for additional services you provide for the families who entrust their children to your care. Fees can also incentivize positive behaviors among your parent customers, such as picking their kids up on time and paying their childcare tuition before the due date.
Keep reading to better understand the different types of fees at childcare centers, and how you can set up a fee structure that suits your business.
A Primer on Fees at Childcare Centers
Before enforcing childcare center fees, you need a way to communicate the costs and reasoning to parents. The most important thing to have in place is some kind of childcare payment policy. This is an official agreement that parents sign, stating they understand the pricing structure and fees, along with the potential consequences of unpaid childcare bills.
In general, make sure you’re clear, transparent, and fair about childcare fees. Don’t charge unnecessary, unexpected fees that aren’t in the payment policy. Be sure to communicate ahead of time if any policy terms are going to change, so parents aren’t taken by surprise.
Fees = An Ethical Part of a Childcare Business Model
Remember, fees are a normal, ethical part of doing business. As a childcare provider, you need to make a profit so you can continue offering the best services possible. Fees cover all the extra time, resources, premium services, and even little inconveniences that add up to cost money.
Childcare fees also allow you to pay your employees fairly and on time. They ensure you’ll be able to afford the right amount of childcare supplies, cover rent and maintenance costs, and maintain a responsible business budget.
7 Types of Fees for Childcare Businesses
When establishing your childcare or daycare fee structure, here are the top items to consider. Every childcare business is different, but these are the most common fees exchanged between parents and teachers.
1. Tuition Fees
Tuition is the amount of money a family pays for ongoing childcare. Fees vary depending on the frequency of childcare (such as daily, hourly, weekly, etc.), the child’s age, and enrollment availability. You can set tuition per hour, as a package plan, or customize it per family based on their needs. Typically, tuition is charged monthly and delivered by invoice to parents.
2. Late Payment Fees
When parents don’t pay tuition on time, childcare centers charge late payment fees. For example, this might be a $45 fine for every week the bill is late. The fee incentivizes on-time payments so parents don’t have to pay extra. Late payment fees also make up for the financial nuisance of waiting on expected tuition to go through. Be clear about late fees and due dates in your payment policy.
3. Late Pickup & Early Drop-Off Fees
One of the most common fees in childcare is the pickup/drop-off fee. Parents are busy; it’s normal for them to need early or late childcare sometimes. However, this isn’t always the most convenient situation for your business, especially with set operating hours. Many childcare centers charge something like $20 for every 30 minutes a parent utilizes excess childcare.
4. Onboarding Fees
Also called a registration fee, onboarding fees help you cover costs and materials for new students. This fee may also include things such as family welcome packets, parent handbooks, branded T-shirts, and adding new contacts to your childcare management software. Include this fee in the initial tuition payment upon enrollment.
5. Meals and Snack Fees
Some childcare centers include snacks in tuition; others offer them at an additional cost. Some families prefer to pack a lunch for their child to bring to daycare; others find it helpful to pay a childcare provider to prepare kid-friendly snacks. Calculate the costs of food, determine whether you want to offer it as an add-on, and keep track of which families pay for meals.
6. After-Hour Care Fees
Childcare and daycare centers often charge premiums for families who want early morning, evening, or even holiday childcare. Since these times are outside of typical care hours, parents can expect to pay higher hourly fees plus any other additional costs required. It’ll be helpful to establish these premium prices beforehand, and make parents aware of their options.
7. Other Service Fees
Transportation, unscheduled “drop-in” care, and special activities such as field trips all cost money. Clearly outline any other possible fees under additional services in your payment policy so parents are charged fairly.
Daily Connect: A Complete Childcare Billing Solution
No matter what types of childcare fees you charge, it’s crucial that you have a way to easily collect and organize all payments. Childcare billing software is one of the best things you can use for your business, especially when it comes with features that streamline your billing processes.
At Daily Connect, we help childcare centers manage their everyday operations better. With our new parent billing features, you get all the support and digital insights you need to take control of billing, invoices, and fees. These features include:
- Automated invoicing — instantly schedule invoices, reminders, and late notices
- Multiple payment options — receive ACH transfer, credit/debit card, cash, or check
- Split payment options — allow families to split their childcare bills
- Organized reporting dashboard — view all unpaid, paid, unprocessed, and late bills next to parents’ contact information
- Subsidy and scholarship logs — remember special funds and financial aid customers
- Fields for additional fees — keep track of every additional fee, fully customizable for your childcare center
In addition to our newest billing features, you get all the other benefits of the Daily Connect app for childcare and daycare management. Keep track of business performance, child attendance, learning assessments, parent-teacher communication, and more. Digitally organize important documents such as incident reports, daily checklists, and childcare licensure renewals.
If you’re ready to make your childcare fees and overall business structure easier and more streamlined, the Daily Connect app is for you. Click here to get started with a free trial of all these features today.