Man Does The Math On Finance Guru Dave Ramsey's Claim That It's 'Stupid' To Spend $80K On Daycare

Ramsey's response has outraged parents everywhere, and one man proved they have every right to be.

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Ask any parent in this country and they'll tell you that the costs of daycare has become not only unaffordable, but absurd. 

So when finance guru Dave Ramsey told a dad who recently called into his show that spending $80,000 a year on daycare was "stupid," it incensed parents all over the internet, because it ignored the situation parents are facing.

A man on TikTok did the math on Dave Ramsey's claim and found that an $80k daycare bill is indeed many parents' reality.

It certainly should not be a surprise to anyone that daycare is crippling many families' finances. Costs were already high to begin with, but since federal daycare subsidies enacted during the pandemic were allowed by the government to expire in September 2023, costs have skyrocketed even more.


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Still, on its face, the dilemma the dad who called into Ramsey's show is facing does seem hard to believe. They spend a staggering $80,000 a year in childcare for their two children. Granted, the dad said that his kids' daycare is "fancy," so presumably there are cheaper options.


But this isn't buying a car or a plane ticket, where you can strip off bells and whistles to get the price down. This is the people taking care of your children. What parent wouldn't spend top dollar for that peace of mind?



Suffice to say, Ramsey didn't see it that way. He called the expenditure "stupid" and told the dad to "downgrade" because "it's time to take the kids off filet Mignon," a dismissive take that has incensed many parents. 

TikToker and finance expert Freddie Smith actually did the math and found what many moms and dads already know: Ramsey's take is completely out of touch with the realities parents are facing when it comes to daycare costs.


Smith found that the dad's $80k daycare bill was right on par with the costs Ramsey called 'stupid.'

Smith began by laying out the pricing the dad had detailed to Ramsey: They pay $25,000 per kid for daycare, plus extra charges for extended care before and after the standard workday. "And it doesn't go during the summer, so during the summer we need a nanny," the dad said.

Smith did a simple Google search for daycare centers in Philadelphia, where the dad said he lived and went with one of the first ones that came up — presumably a middle-of-the-road daycare in terms of costs. 



As the screenshots Smith used showed, the daycare charges "$314 a week for an infant per full day." Aftercare is an additional $10 or $15 per day, depending on how late the parents need their child to stay.


"So for an infant at this school, it's $19,200 for the year." He then added a toddler to the bill, with aftercare, which was an additional $14,800. "That is $35,000 for two children... that is astronomical," Smith said.

Smith predicted that it's going to get far worse."If you can charge these kinds of prices because of the supply and demand," he said, "investors are coming for this next." That, unfortunately, is already happening as private equity firms move into the daycare industry at a rapid pace.

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The average cost of daycare in the US is $10,000 a year, with many parents paying far more.

Granted, the $35,000 Smith calculated is a far cry from $80,000. But there are myriad other factors that play into a daycare choice. Perhaps a cheaper option is too far away from the parents' home. Perhaps the cheaper options have terrible reputations. The list goes on.


Miranda, a friend of mine in suburban Detroit where cost of living is far cheaper than East Coast cities like Philadelphia, found herself in this situation. The expiration of the federal subsidies' put her daycare bill at $15,000 a year for her toddler son.



But with her twin babies about to enter daycare as well, that bill was set to balloon to nearly $54,000; more than her husband's entire teacher's salary. And that's all without having to pay for early or aftercare due to her flexible work schedule.

She, too, has cheaper options in her area. "But once you start talking to other moms, it's a 'you get what you pay for' type of thing," she said in reference to negative stories she heard about the quality of care at more affordable facilities.


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So instead, her teacher husband has decided to resign and become a stay-at-home dad. "It's the only way we could get by without sweating bullets every month — and god forbid there be an emergency."

Many other parents, of course, don't have such options, nor do they have the option of spending $80,000 a year for top-quality care, like the dad who called into Dave Ramsey's show.


But the point is this: Parents shouldn't have to be put in a position of nickel-and-diming things like the people charged with keeping their children alive all day. Nickel-and-diming is for things like groceries and entertainment, not childcare.

And with even the average cost of childcare in the U.S. ballooning to $10,000 a year — before the subsidies expired — and the median household income in America just $74,580, it's easy to see why so many parents are strapped by childcare, not to mention going into debt to pay for it.

So to the Dave Ramseys of the world: No, parents aren't "stupid" for paying through the nose for childcare, and they're not irresponsible either. The political and governmental systems allowing this mess to continue worsening are. Direct your ire at them.


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John Sundholm is a news and entertainment writer who covers pop culture, social justice, and human interest topics.