Here’s How Much It Costs To Be A Stay-At-Home Parent

It’s no secret that many young parents these days face a stark choice: pay through the nose for professional child care—or leave the workforce and become full-time caregivers themselves.

Many of us weigh this decision by doing some quick, mental math. We multiply the number of years we plan to be stay-at-home parents by our current incomes, and then use that number to determine if the potential pay cut stacks up against not having to pay exorbitant rates for child care.

For lots of young parents, that arithmetic points toward staying at home. After all, the average cost of child care is now double what it was 25 years ago, according to Census Bureau data. The cost of enrolling two little kids at a child care center now equals 59% of the median income of a woman between the ages of 21 and 31, the group most likely to have young children, according to a new study by the left-leaning think tank, Center for American Progress. (Because men still make more than women on average, it adds up to 54% of the median income of a man in the same age group.)

Depending on which state a young parent lives in, that ratio of income-to-child-care costs is often even worse, the CAP study found. Take Massachusetts, for example. Women between the ages of 21 and 31 in that state have higher median incomes—$38,320 per year—when compared to their compatriots nationally. But the cost of putting two kids in a child care center in Massachusetts runs an average of $29,843 per year, according to 2015 data from the non-profit Child Care Aware of America. That’s a solid 78% of a young Massachusetts woman’s median salary.

When that’s the math, taking a big pay cut to become a full-time caregiver begins to seem totally rational—which is perhaps one reason that more American mothers are now choosing to stay at home than any other time in the past two decades, according to a 2014 report by the Pew Research Center.

But that’s not the whole story. A new online calculator released June 21 by CAP throws a curve ball. It’s not enough to just look at lost wages, the authors say. The real financial cost of becoming an unpaid caregiver must take into account a whole host of other, long-term monetary factors, including lost retirement funds, lost benefits, lost wages and lost years of wage growth. (And that’s to say nothing of the fact that unpaid caregivers will end up with smaller Social Security payouts after retirement.) If you look at that broader picture, the actual economic impact of leaving the traditional workforce is usually about three to four times larger what we expect.

Take, for example, a 28-year-old, college educated woman who makes $48,500—the median annual salary for college-educated Americans between the ages of 25 and 34—who plans to leave the traditional workforce for five years. If you do the quick math, her decision to become a full-time unpaid care giver might appear to make sense: She’ll leave roughly $240,000 on the table in the form of her lost wages over five years, but she won’t have to spend tens of thousands of dollars a year on child care.

But then look again. According to the CAP calculator, which draws on data from the national census, the Bureau of Labor Statistics, and the non-partisan group, Child Care Aware of America, our 28-year-old mother will also give up $213,018 in lost retirement assets and benefits and $244,811 in lost wage growth. If you add that to her $242,500 in lost wages, that’s a staggering total income loss of more than $700,000. Suddenly, taking five years off looks, well, kind of financially insane.

That reality puts many young parents—and especially young women, who are still far more likely to be full-time caregivers—in a really tough spot. Should they find a way to stay in the work force, come hell or high water, or do they simply choose to take the financial hit and hope for the best?

The answer to that question, of course, depends on a host of unquantifiable and personal factors—the non-monetary benefits of caring for young children, for example, or the special needs of a kid, or whether there’s family nearby who can perform child care duties for free. It also depends on other realities of life, like marital status, income and whether a young parent is also responsible for caring for a sick relative or aging parents.

A young mother who is married or partnered also has a financial leg-up. The potential of a dual income household makes short-term, full-time, unpaid caregiving a much more economically feasible option, while single parents have to make ends meet on their own.

Those who are in higher income brackets also enjoy a better income-to-child-care ratio: wealthier families can expect to spend as little as 7.2% of their family income on child care, according to research by the Census Bureau. (While that’s still up from the average of 6.3% in 1986, the earliest year that data is available, it’s not going to break the bank.) Families on the lower end of the income spectrum are often required to shell out as much as 40% of their income on child care, according to the Census Bureau—substantially more than many families spend on food.

Read more: I Surveyed More Than 1,000 People to Find Out How Having a Working Mom Really Affects Kids

Advocates say these numbers point to a dire, and worsening, social crisis, and while the issue is not likely to become a centerpiece of the 2016 election any time soon, both parties’ presumptive nominees have already weighed in, offering very different solutions.

Democratic presumptive nominee Hillary Clinton, who has fashioned herself a champion of women and children, has laid out a plan to create universal preschool for all children, in addition to affordable child care options, through federal subsidies, tax rebates, and the existing Early Head Start programs. Tax breaks for young families, including the Child Tax Credit, the Child and Dependent Care Credit, and the Earned Income Tax Credit, all of which give back thousands of dollars to families with children, are important, she says, but emphasizes that state and federal government must do more.

Republican presumptive nominee Donald Trump’s solution, meanwhile, has focused on compelling private sector companies to provide child care to their employees. “It’s not expensive for a company to do it,” he said at a town hall event in Iowa last fall. “You need one person or two people, and you need some blocks and you need some swings and some toys…It’s something that can be done, I think, very easily by a company.” Trump has not elaborated on the plan or explained how, exactly, companies would be encouraged to spend on in-house childcare.

In the meantime, most young parents are stuck doing the same calculations—only now with slightly more complicated math.