Childcare Center Billing: A Quick Guide

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Done right, running your own childcare business can result in major success. You can provide an important service to your community, helping young children learn important skills, while also making a great living for yourself. But one of the most frequent difficulties business owners in the daycare industry face is managing childcare center billing.

With the right tools and practices in place, setting up a childcare center billing system can help the owners, staff members, and parents provide the best childcare possible. If you’re trying to improve the financial aspect of your childcare business, here is a quick guide to set yourself up properly.

Set Your Cost of Tuition

To bill effectively, you first need to know the cost of tuition for someone to enter your childcare program. If you’re running a daycare that is already well-established, you likely have tuition down, as well as all the details that come with it. 

Determining Tuition Costs

If you’re new to running a childcare business, here are some of the things to consider when setting up the cost of tuition:

  • Business expenses (rent, payroll, utilities, etc.)
  • Insurance and licensing costs 
  • Marketing budget
  • School supplies
  • Taxes and deductions
  • And more

Competition and Capacity

Your tuition rates will also depend on how much local competition charges, as the parents who are considering your daycare center will compare with other schools. Look at how much they’re charging and how they handle their tuition process so you know what to base your pricing on. 

Another thing to consider is the capacity of your facility. How much will rates change if you’re not at maximum capacity? Some childcare centers leave wiggle room so their maximum capacity brings in extra revenue. Others are comfortable always running at maximum capacity with a long waitlist. If you have specific financial goals for your center, you may have to factor in future gains in your tuition setup. 

Pricing Structure 

Once you know your tuition costs, you need to decide how to best structure your pricing. When parents sign their child up to attend daycare, they want clear expectations of how and when they’ll pay the bill. 

Some daycare providers charge hourly, whereas others run on a weekly or monthly payment plan. Other things to make clear in the pricing structure is special additional fees such as:

  • Enrollment fees
  • Late pick up fees
  • Special holiday prices
  • Late payment fees
  • Summer vacation childcare plans
  • Special deals for advanced payment 
  • Optional extras, like field trip fees

If there are any other specific details necessary to families in your childcare center, make sure that you outline them clearly in your payment policies. 

Childcare Center Billing: Payment Methods and Policies

Once the parents enrolling in your daycare understand the pricing structure, the next issue they’ll  have questions about is how to make payment. It’s best to create a set of client policies that clearly explain costs, payment methods, and tuition agreements. 

How to Collect Payment

Most daycare providers collect payments through online payments, using methods like credit cards or ACH bank transfers, but others will accept cash or checks. Having an online payment system is the most convenient option for childcare centers today, enabling payments to be collected on auto-pilot. Whether it’s through a payment collection page on your school’s website or a childcare center parent billing software, many parents appreciate the option to pay online. This way, they can monitor their bills and set up recurring options. 

Parent Policy Handbook

Instead of sharing a random collection of paperwork and documentation with the parents who enroll in your childcare center, most childcare centers offer a handbook. Whether it’s a paper handbook or a digital handbook, a parent policy handbook will make it easy for the parents to have all their questions answered in one place. If your daycare center accepts any form of financial aid, make sure you set up details about that in the policies as well

Tracking Billing and Accounting 

Every childcare center needs to keep track of parent billing and payments on an ongoing basis. With consistent accounting, you’ll save yourself the headache of losing track of late or missed payments, misfiling paperwork, and developing poor communication with parents

Billing Frequency

Determine how often you will bill at your childcare center. Will payments be due once a month? Bi-weekly? Weekly? Depending on your facility’s bills and expenses, make sure you’ll receive childcare payments in a timely manner so you have enough overhead to operate your business. 


How will your daycare center managers keep track of all the payments that come in and out of your business? It’s a good idea to keep track of all your revenue and expenses on a central platform. Some of the areas you should track are: 

  • Tuition from each family
  • Invoices
  • Receipts
  • Additional fees
  • Online payment dashboard
  • Log of transactions 
  • Operational fees and dues

While some daycare center owners do their accounting and bookkeeping themselves, you can also consider hiring a professional accountant who is familiar with the childcare industry.

All-in-One Childcare Center Billing Software 

Having childcare software that handles all your parent billing needs will streamline your processes, and can make your life a lot easier. Some childcare software systems such as Daily Connect offer invoicing, parent payment tracking, and a variety of payment processing. All of these can be done within the app, saving you and your staff a lot of time and resources. 

Childcare software also allows your business to keep a close eye on payments and parent communication simultaneously. For example, you can set up an automated invoice that will be sent out on a designated date each month, so parents never miss an upcoming bill notice. It allows them to pay instantly through the app or online. Or, if they prefer to set up automatic payments, they have the option to do so. 

Other features of this type of software include: 

  • Sign-in and sign-out tracking
  • Student learning and assessment tools
  • Staff-teacher communication boards
  • Parent-teacher direct messaging 
  • Childcare center management software
  • Documentation and compliance tracking
  • And more

If you’re ready to implement a full-featured childcare software that can handle the billing for your childcare business, get started with Daily Connect today. See what Parent Billing can offer your center. If you have other questions about childcare software, set up a demo with our team to learn more

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