Ultimate Guide: How To Make $4000 a Month From Home/ Home Daycare Edition
Do you want to work from home full-time and actually make money?
Here is one easy way to make over $4000 per month!
When you are entering midlife (40’s) there may be many reasons that cause you to develop the need to create a new source of income for yourself…stay at home mom, money required to allow you to pursue your purpose, illness or condition that makes it hard to commit to a day to day corporate job, needing more income than you are currently making to support a growing family or college etc.
Whatever your reasons are there are a number of ways to make additional income or create a work from home scenario.
In a related article I list all the ways that I have made money at home for myself that you can easily replicate and this is one of the major ways that I generated over $4000 per month consistently for several years without having to leave my home or even get out of my pj’s some days while staying home with my 3 youngest kids.
This is how I did it and what I learned the hard way.
My Home Daycare Story
I have always been an entrepreneurial person…when I was a kid I had the lemon aid stand, I ran a carnival in my backyard and gave my toys away as prizes, I babysat, cut grass…you know all the usual childhood ways to make your own money.
I worked from a young age so that I could always have money to buy the things I wanted and when I found myself at home with a young baby it became difficult for me to go back to work. I tried for a period but in the end it wasn’t right for me.
So being the entrepreneur that I was I made it my mission to find something to do to keep me mentally & creatively stimulated and to earn some money while I remained home full-time.
There have been a few methods I have used over the years that I describe in a related post such as interior design, home organizing/cleaning, freelancing, selling handmade crafts & quilts…all the way to running a home daycare. The last one kind of fell in my lap by accident and turned out to be the most stable & profitable to date.
How it started was I met a family at my sons school when he was in junior kindergarten who we became close with. The little boy was going to have to move away due to his mother not having care for him while she worked, so to avoid this unfavorable situation I offered to watch him before & after school for the remainder of the school year so that he could finish it off.
I ended up babysitting free of charge to help this family out for half the school year (I was offered money but turned it down, but accepted lots of free food & treats as payment).
This led me to wonder if I could do this and make some money. So that is what I ended up trying out. I have been doing it ever since…almost 10 years now.
After my first experience with before & after care I continued on with it and then slowly progressed to add in full-day childcare as well.
Having this home daycare business has financially saved my family many times and even for a point in time became our sole family income.
I have made anywhere from $500 per month to OVER $5000!
I am going to give you the formula that worked best for me, as well as tips to save you from many, many, headaches that come from taking care of kids all day, dealing with parents and running the business.
Things I wish I had done from the start.
12 Steps to Running a Profitable Home Daycare
Decide what your goals are…hours offered each day, full-day or before & after school care, ages of kids who will be in your care and how much money you want to make each month? Everyone will have a different motivator here or it may change over time.
For me the main motivator was making extra money while I was on maternity leave with my third son. I wanted to stay home and gave myself the goal of making $1000 to be able to do that.
I knew that if I returned to work it would cost me over $1000 for daycare and then I would also have to figure out before & after school for my school age son..it would have been a lot of money, driving and juggling. It didn’t seem worth whatever money I would be left with in the end after all the work related expenses.
So, my goal was $1000 per month and free time during the day to take care of the baby…that sounded good to me. So I picked up one full-day girl and a family of three a few days per week for before & after school care…I met my goal.
After deciding on your goals understand the different forms of daycare. As mentioned previously I offered before & after school & full-time daycare. Here is a description of both:
Before & After School Care. As it sounds, it is you watching the children from drop off from parents (your set start time) until they either get picked up by a school bus or you walk them to school. Then at the end of the day you collect them from school or the bus until parents can come and pick them up.
In this case all you require is a couch, tv and maybe breakfast food if included or after school snacks. This option is nice if you want to have your days free, however you will make less money. An additional add on service here is watching kids on days the school is not open like March Break etc. ( full- day rates should apply here).
Full-Daycare. You watch children from parent drop-off until end of day pick-up. In this case you will require a lot more accommodations (activities, food, space etc.) for the children and in turn can charge more money. The remainder of this article focuses on detailing the full daycare scenario.
Now that you have decided your time commitments & your income goals it is time to look at the logistics for the business itself within your home.
Overall space in your home for the daycare. It can be one room or an entire home. In my case I started with my living room and dining room being the spaces that I ran the business out of. After moving to a new house I had a bonus room and turned that into a dedicated toy room for the kids and then kept the living room and dining room for the space as well.
Some people will convert an area in their basement into a dedicated space as well. Whatever works for you is possible, it may just take some organizing and planning that is all.
You also need to look at an outside space for kids to play. Do you have a back or front yard for them to safely play in? Are you located within walking distance to safely take the kids to the park for outside playtime? In this case will you require a stroller or wagon?
You will need a play zone for toys, crafts and activities. This can be any space you choose. I kept toy bins in a cupboard so that the kids could easily access them and then were easy for them to also put away when done playing.
The more organized the better it will be for you. To fill the space I would use age appropriate/safe toys my kids no longer played with, I would buy items from the dollar store and would keep my eye out for free/thrifted items in great condition..i.e. kids bikes, wagons, blocks etc.
Do not rush out and buy a bunch of crafts and toys…in all reality kids are happy with only a few fun options and tend to play with the same things most of the time…like that one item they all fight over ha ha. See what they are drawn to and add to that.
My kids all loved big building blocks and the 3 year old’s loved playdoh and cookie cutters…nothing fancy or expensive. Remember the more you have for them to play with the more there will be to maintain and clean.
You will need a space for eating and appropriate chairs for the kids to reach the table height. I found all my kids over 3 yrs could sit in a regular chair and any who were younger or shorter got a booster seat on a chair or I had one high chair for the youngest. I also had dedicated plastic divided dishes for the kids (like a bento box) and plastic cups for them to drink out of. Keep your eye in mom groups and market place for free or inexpensive children's chairs.
Bathroom accommodations. I had parents provide any diapers & wipes required for the children and I had a toilet potty seat & stool for the children who were training.
Also be sure to have a space in your home for extra clothes for the kids provided by their parents in cases of accidents…which their will be many. Another tip is to always have plastic shopping bags or large Ziplocs on hand for any rinsed soiled items.
You will also need a space for naps or quite time. I had one dark bedroom upstairs with a playpen set up for any babies to have a nap in a quite dark space (I only ever had 1).
For all the kids who were between 2-3 years old, who sometimes would nap and other times not, I would set up my living room for them. I would announce “quite time” right after lunch clean up and all the kids would grab a pillow and blanket out of a tucked away basket.
We would set up on the couch or make a fun slumber party space on the carpet for them to lay and quietly watch a movie or in most cases they would fall asleep. This will depend again on the ages of the kids and your space, just be creative with what you have.
O.k. So now that you have decided on your hours you want to work, money you would like to make and the space you have to accommodate the kids it is time to find some families to work with. Time to create your listing
Be sure in your ad to be clear about your services…include: your hours of operation, your rates, your approximate location and any schools in the area, if you are pet friendly or not, that you include healthy meals and snacks or not.
Be sure to let them know of any features like outside play area, toy room, CPR training (not required but could be an asset. I have never been asked to provide this before) or walking distance to a great park.
Be sure to invite them for a visit to come and view for themselves. You can also include photos of your space but in all honesty I have never added more than a nice view from my backyard.
Where to list your ad to find great families to work with. In my experience local home daycare pages on Facebook is where I have found all of my families, as well as word of mouth. You can search through Facebook and join these home daycare pages or even local mom groups.
Check if they have any rules as to when you can post and submit your listing. I have had no luck listing in the general marketplace and have even had a few scammers message me, so be careful where you post and the information you give out.
When I receive messages from potential families I will creep their profile to see if they are indeed who they say they are before going ahead and booking a viewing of my home. Once in contact set-up a viewing and answer any additional questions.
The interview and clearly laying out some guidelines from the very start. This is the step of inviting the family in to see your space, meet you and any other kids in your care and for YOU to decide if this family will be a good fit for you.
They are not only asking you questions and deciding on you but you are making judgments as to whether you want to go ahead as well. It is O.K. to turn a family down if you have off feelings about anything.
This is the step that created some issues for me down the road in my business (and honestly continued to because I didn’t feel comfortable changing the deal part way through the arrangement). I have a tendency to offer the world with little expectations in return.
Do not over promise to the families you are interviewing either to win them over or because you are naturally a very accommodating person. You will regret it down the road and will have set the ground work that will be very hard to go back on once the deal has been made.
Be clear and have a contract.
What to include in your contract and why.
Here is where I got myself into some trouble. I had no contract and no guidelines. I like to be accommodating and fair…so what were my mistakes and what should you 100% ad in your contract?
Have very clear hours of operations and extra fee’s for late pick-ups. I offered no set hours. I ended up having kids dropped off and picked up anytime between 5:30am and 6:30pm. To be clear that is 13 HOURS per day!!!!…it was exhausting and I could not sustain it.
I was able to remedy this by setting new hours for families between 6am and 5pm...anything over was extra and had to be arranged ahead of time. I explained the situation and that some kids were getting dropped off early so I had to close earlier. The parents were very understanding and we worked together for any overtime situations.
Have a set number of “free” sick days allowed for a month and clearly state anything above will be charged for. Or clearly state that they are paying for the spot whether there or not. Same price every week regardless.
I unfortunately for me offered sick days with parents not having to pay and no notice required. I was looking at it from the perspective of parents not making money when kids were sick and I wanted to be empathetic….well it turned into kids missing days very frequently and me not getting paid sometimes for an entire week.
This was the biggest downside of my arrangement and I wish I had changed it from the start. Some parents definitely took advantage of this loophole sick or not sick.
I did change this policy for all new families and charged for the spot (minus planned approved holidays).
I also took no deposit when I started with a family which I definitely should have taken at least a 1-2 weeks non-refundable payment (I will explain why in a moment).
I had childcare payments agreed to be paid on the Friday at the end of every week. I had no late payment fee’s and had not indicated any penalties for non-payment. I also had never stated how much notice of service cancelation I required.
What happened? I had people forget to pay me on Friday and then I had to email people on the weekend sometimes several times for payment reminders. Most of them usually paid right away, but I did on a pretty frequent basis have people tell me they couldn’t pay for a week, 2 weeks and one time for a month.
I had people tell me on Friday they no longer needed my services as of that day and I was left with spots to fill to get my income back ASAP. Yes, I said people not person, because it happened more than once, more than two times..it was a horrible blow to my income.
I had created the mess by being accommodating and not having a contract in place that clearly stated the deal. That is not how to run a successful business, unless you do not need the money.
If I had collected a deposit, that would have covered the missed payments and no notice of canceling services and I would have been in less of a bind financially.
Vacation Days. I also once again did not have anything in place for vacation days. I gave notice right away that I took one week in the summer and a long weekend with the dates. I also told parents they did not have to pay when I was off.
Parents usually informed me of any holidays they may take at that time, however you still need something in place. Will you give them 1 week of vacation without paying or are they still expected to cover their spot regardless? I have heard of Home Daycares running similar to a facility and you pay for the spot.
The summer months I ended up with less than half my income from all the vacations and missed days. I would suggest 1 week and pay for every missed day after that. You would be surprised at how many nice sunny days there are in the summer and people taking days off to enjoy them, at your expense ha ha.
Holidays. You also need to include in your contract if you will be working on any statutory holidays (Thanksgiving, Easter etc.). Some people still have to work and you need to let them know you do not and they will have to find alternate care for those days. I do not charge for these days and I do not work on these days.
Fee’s. It is also good to have amounts clearly stated and what form of payment you will accept. I charge the local going rates. $40 per child full-day, $20 per child half-day (4 hours or less), $25 for before & after school and I would charge $10 per hour over close times if requested.
I accepted cash, but preferred e-transfer for the ease of keeping records for tax purposes. I also provided tax receipts for parents at the end of the tax season. Make it clear the day you expect payment (every Friday etc.) and that a late fee may apply if payment is not on time.
As for any health & safety sections in your contract you will need to enquire about that. I have never included such things, but it may be something that can be very helpful someday. i.e. liability, insurance, first aid training, emergency procedures.
Ok now you have all your ducks lined up lets create a great working environment to make your life easier.
Create a dedicated space and boundaries of rooms that are off-limits. If you let your house become a free for all it will be a chaotic, stressful mess in no time. You want to contain the daycare as much as possible. I have my main floor open for the daycare. This includes my entry, washroom, kitchen, living room and toy room. No one was allowed in the basement and no one was allowed up into the bedrooms with the exception of my own children leaving for their own quite time.
I could see all the kids at all times this way and I never had messes outside of this space. It also allowed my children a break from the daycare and to protect their personal toys etc.
I created zones...toy room was for playing (not running or yelling), outside was for running & yelling ha ha, living room was for quite time & movies…The kids adapted to what could be done in each space.
One of the most important things you can do when you have a home daycare to save your sanity is to have routines. Kids are creatures of habit. They quickly learn and understand what they are allowed to do, what is coming next to look forward to and what the expectations are of them.
It will save you a lot of questions from the kids…they will know the drill. TIP***link cleaning up their mess followed by outside time or their favourite craft…you will be amazed how motivated they become to clean up. Here is my sample routine that I followed and also posted for parents to see:
6am - 9am. Arrivals, breakfast, quite time watching a movie or in the toy room. Arrivals were staggered with some kids arriving very early so this was necessary to keep things relatively quite for tired kids arriving and my own sleeping family.
9am - 10 am. Free play in toy room. (dress-up, blocks, play kitchen, train tracks, crafts etc.)
10am - 10:30am. Clean up time and getting ready for outside time. (washroom breaks etc.)
10:30am - 11:45am. Outside time (weather permitting. Winter months we were likely only out 20 minutes if really cold)
11:45am - 1pm. Lunch time, washroom breaks, quick playtime while I cleaned up from lunch.
1pm - 3pm. Quite time and naps. Hurray you have made it…easy peasy from this point of the day on…
3pm - 5 pm. Clean up from nap time followed by snacks and a t.v show. Most kids would venture back into the toy room for some more free play (this time also would contain craft time or outside time depending on the day and weather).
In all honesty I would base a lot of the days off of what the kids were into that particular day. Were they exited to have a dance party and sing along? Were they looking forward to playing with playdoh? Or did they just want to quietly play with some toys. I read the crowd and if I felt they were losing interest or bored we would find something else stimulating or fun to do next. I was structured but not inflexible.
Along with creating a routine I also created a weekly menu (it varied sometimes but was pretty consistent). You will quickly learn that kids don’t like most foods ha ha...some are great but others will refuse to eat all day. ALL DAY! Unless you offered them a cookie of course. So how do you overcome this?
make very plain kid friendly foods that you have come to learn your kids like. I made everything under the sun and learned they would only eat grilled cheese, fries & nuggets and pancakes etc.
So I made them regularly. I also created a bento box type lunch. A plate dived into sections..one was the main, then a fruit/veggie and then a treat if they ate or attempted to eat most pf their food.
I did also have some very picky eaters who would bring their own lunches to ensure they would eat something, and most times they didn’t really eat that either…no food and endless energy…I never understood ha ha.
I also became familiar with certain kids favourites and would give them each a day of their favourite lunch foods. This definitely helped.
Everyone had to stay at the table until most kids were finished. NO wandering off because you refused to eat. You had to wait for the majority to finish first.
I also would save the food that wasn’t eaten for 10-15 minutes because more times than not I would be told they were hungry right after lunch was done and they could go back and finish their lunch.
It seemed that they werent actually “hungry” for lunch, they just wanted to see what else I had to offer. I spent a lot of time trying to convince kids to eat food and not just treats.
The kids also knew that when lunch clean up was done and quite time had started there was no food again until snack time. They made the choices to eat or not and they did understand how long they would have to wait for snack time. We need to give these guys credit for this…they can make a choice and accept the consequences even at 3 years old.
All food and drinks remained in the kitchen. Drinks were available all day, but food was only at set times.
Mental Health Breaks for you…“Sanity Breaks”. As you know kids can be loud, move around a lot, make messes, fight, cry…well when you times that by 5 it can and will get overwhelming at times.
There will be moments when you will finish your work day ready for bed and not want to get up and do it again the very next day.
There are things that you can do that will help with this and you must do them to avoid burnout (which is very, very real). Here is what I have learned from many years of experience:
Use the daily routine and meal plans. It will take the guess work out of the day and you can run on auto-pilot for the basics. The kids will understand expectations and usually abide by them.
Get outside when its loud…if it is not scheduled outside time and it is a nice day…outside go out anyways. The level of craziness for me went from a 10 down to a 3 once we were outdoors. I could take a breather and recharge.
We spent most of the spring and summer months outside, coming in for food, washroom breaks and quite/nap time. It burned their energy running and there was less mess and noise for me to deal with.
Be very strict with quite time…it is not just for them. I had kids who napped along with kids who did not. I kept it quite so no one was disturbed and it allowed me up to 2 hours to sit in the room with them in peace while they watched a quite movie. I could read, tidy my house or just drink my tea.
I looked forward to this time on rough days and it saved me. Disclaimer. I had very well behaved kids who I watched with minimal fighting with each other or crying..almost never…however when they all play at the same time and are laughing & running & having fun…it can still be very over stimulating for us…you will need that agreed upon time for quite.
Time out spots. I had some rambunctious boys for a period…I ended up creating the time out stair for them to sit on (for 1-2 minutes) if they were getting out of hand or if there was conflict. It helped keep them inline sometimes and other times they just bounced on the stair ha ha, but they knew and accepted the consequences.
They really showed responsibility and it wasn’t about punishment, it was a time to let them know they were going to far and needed a moment to bring it back in. There was never crying when put on the time out spot they just went and waited for their time to pass and try again with better behaviour. (parents were notified when we had excessive time outs or out of hand behaviour, but that rarely happened).
Take time off…I booked a week off in the summer along with a long weekend. I also took off every holiday like Christmas and Easter. I looked forward to that time and it recharged me.
Also, if you are feeling sick or burnt out take a sick day…don’t abuse it but take it if you need it. There were only a few occasions that I really needed a break but I let the parents know as soon as I decided it was necessary and took the day…no explanation required other than day off.
A surprising challenge that I didn’t anticipate was the behaviour of my own kids who were home with me throughout a lot of the daycare years. It seemed all the kids would follow the rules and my own kids would try to run wild. Go figure.
It was challenging because it was their home and they were used to being able to do a lot of the things they weren’t allowed to do when daycare was happening…i.e. grabbing a snack or playing outside.
On weekends it was not structured and they had a hard time understanding on weekdays that it had to be different. So try to be empathetic to your kids who now live in your workplace.
There will be times when they don’t want to share their own personal toy, or mom…teaching moments are what they become. So when my kids were trying through the day, I would pass them off to my husband in the evening so that I could take a mental break from the around the clock childcare.
Excersise. I know this may sound odd but I started working out early in the morning right after all the kids arrived. I did a workout video in the living room while the kids had free time in the toy room and it made me feel great afterwards. I even had 2-3 of the kids work out with me everyday, which was super cute and a lot of fun for them.
How to keep kids entertained?
Playdoh with cookie cutters and rolling pins.
Colouring with markers (do hide them and supervise, they will colour themselves & each other, true story). Also, I could not get them to sit and colour with crayons..it had to be markers.
Building blocks. I just had a bucket of large blocks and they would build houses and towers etc. They loved them.
Dance parties (YouTube is great for kids music videos and dancing).
Exercise and games outdoors. Scavenger hunts, races etc.
Sandboxes. No need for fancy sand box toys. They loved digging with sticks, old spoons and cups.
Bikes (tricycles, small bikes with training wheels, wagons, play cars).
Play kitchen with toy food.
Dressing up with any sort of costumes. I had saved all the old Halloween costumes from over the years so had an assortment of princesses to ninja turtles.
Playing with oversized boxes. They liked to build houses and forts. Appliance boxes were great and sturdy.
Decorating cupcakes with sprinkles etc.
Building blanket forts. They loved this but it did cause the most drama when someone would stand-up unknowingly and knock it down. FYI ha ha.
Cars, dolls, trains…the usual kids toys.
Business, Regulations and Money Matters
Taxes.
You will most likely be issuing tax receipts and claiming your income. Parents will want a tax receipt to help them lower their tax bill using the childcare allowances and if they are claiming them then you need to claim them as a source of income as well.
Research and be aware of your local tax laws. You can make up to a certain amount before you have to pay any taxes on the income what so ever. Once you go above that limit you will be in for a rude awakening if you haven’t been paying attention and planning for the tax season.
Write off all of your childcare related expenses i.e. food, rent/mortgage payments, utilities, materials & craft supplies, toys, internet, gas to and from the grocery store. Be sure to set aside a percentage of your income for your taxes.
I did not have to pay taxes for the first 5 years because I fell under the limit, however the first year I did have to pay it was $3500.00!!! I was not anticipating that and have now adapted to try and lower my yearly tax bill.
Number of kids allowed in your care.
Where I live I can have 5 preschool aged children including my own. So that limited my capacity until my kids were all off to school. I also got around the child limit with Before & After care.
I was only allowed 5 children but most of them arrived after the school kids left on the bus and were picked up right after school was finished. So I did not have any over lap and was able to run a Before & After program, as well as a Full-Day.
I had a full roster for before & after, as well as the second group arriving for full-day. It was financially rewarding and I was allowed to do so without breaking any regaltions.
Always be sure to have money saved for a rainy day…things happen and can leave you unexpectedly with no income i.e. a pandemic, a parents job loss or illness, or even your own illness forcing you to not take kids in for a period.
I had a very rocky period of the kids all getting sick one month. There was not a week that went by that half my kids were off. That means that for that month I lost half my income…you can’t plan for these scenarios but you can prepare for them by having some money set aside or by not relying on the full amount that you make…ie. I always “planned” to take home $800 per week.
I could plan my budget around that and it was most likely going to happen. If I had a full week and made $1000 great, bonus.
But if someone was sick for a day or two then it wasn’t a hit because I had a built in buffer. As mentioned previously I did end up switching to parents paying for the spot for the month and not the days they came. This way I knew exactly how much I was going to have each and every month. It made life so much easier.
Plan the years to come.
This one was not obvious to me until it hit me all at once and my business stumbled. I had a full roster of kids. The ages ranged from 3-4 years old which was great. Everyone was on the same sleep schedule and for playtime it worked out great...same interests & levels of play.
However...I was anticipating the start of the school year when my last child was going to be full-time (she was 4 heading into the summer). Then I started to realize all the daycare kids were the exact same age…all of them.
What did this mean? It meant that in 2 months I no longer had full-time daycare kids. I still had Before & After school (thank God), but not my main income source.
So be aware. Plan ahead (months and months) to refill those spots or stagger your age groups…maybe have a few 2 year old’s for example. I decided it was my ticket out and on to something else, keeping with my B&A kids, but having my days free to pursue new opportunities. Thank you daycare for proving for me for almost a decade. Wow!
* Since writing this post I have jumped back in to Full-Day Care again as well. I could not find another job that gave me the same freedom to be at home and making the same amount of money. If its not broke don’t fix it I guess.
Home Childcare can be very profitable and very exhausting at the same time. There were many times I wanted to quit but was trapped by the money and ease of being home.
It is hard to work outside of the house when you make more at home, have no childcare costs of your own, no vehicle costs and don’t have to get dressed up everyday. It is also very rewarding being part of these children’s lives at such an impressionable and fun age.
This business is all about finding the right balance that works for you and for your family (because they are living at your work place in reality).
Be sure to really research and think about this choice before moving further. Be able to commit to the year before taking on a family. It is not fair to try and not like it and leave people scrambling to find a new provider.
I hope this Ultimate Guide to Home Childcare has helped you either decide on starting a business or given tips to help with one you may already have underway.
Leave a comment below if you found this helpful in any way!
Thanks for reading!