How Much Does It Cost to Start a Daycare? (2026)
One-time startup cost
$26,950 to $218,000
Monthly burn
$5,800 to $32,000
Itemized cost breakdown
| Item | One-time | Monthly |
|---|---|---|
| State licensing & facility permit fees | $250 to $3,000 | $0 |
| Classroom furniture, cots, toys & initial learning materials | $5,000 to $30,000 | - |
| Indoor/outdoor play equipment & safety surfacing | $3,000 to $40,000 | - |
| Lease deposit & buildout (ADA bathrooms, sinks, childproofing, kitchen) | $15,000 to $120,000 | - |
| General liability, property & abuse/misconduct insurance | - | $200 to $2,000 |
| Fire, security & door-access systems installation | $1,200 to $8,000 | - |
| Childcare management software, billing & communications tools | $0 to $2,000 | $100 to $500 |
| Initial marketing launch (signage, social ads, local listings, open house) | $2,000 to $12,000 | - |
| Food, snacks, diapers/wipes & cleaning supplies | - | $500 to $2,500 |
| Staff background checks, CPR/First Aid training & initial certifications | $500 to $3,000 | - |
| Staff payroll (lead teachers, assistants, substitutes) — often >50% of revenue | - | $2,000 to $12,000 |
| Facility rent or mortgage payment | - | $3,000 to $15,000 |
6-month runway
$61,750 to $410,000
Startup cost plus six months of burn: a rough floor for how much cash to have in hand before you open, since most businesses aren’t profitable from day one.
How to lower these costs
Lease deposit & buildout (ADA bathrooms, sinks, childproofing, kitchen) is one of the largest one-time costs ($15,000 to $120,000). Look for used or leased equipment, a smaller initial order, or a phased buildout to shrink the upfront check.
Indoor/outdoor play equipment & safety surfacing is one of the largest one-time costs ($3,000 to $40,000). Look for used or leased equipment, a smaller initial order, or a phased buildout to shrink the upfront check.
Facility rent or mortgage payment runs $3,000 to $15,000/month. Negotiate the rate up front, shop multiple vendors, or delay this line item until revenue can cover it.
Staff payroll (lead teachers, assistants, substitutes) — often >50% of revenue runs $2,000 to $12,000/month. Negotiate the rate up front, shop multiple vendors, or delay this line item until revenue can cover it.
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But is it profitable? →
See margins, demand, and competition for a daycare.
Frequently asked questions
How much does it really cost to start a daycare?
Total startup cost ranges from about $2,000–$10,000 for a home-based daycare that passes state licensing to $50,000–$500,000+ for a modest commercial center with a leased space and 30–50+ kids. The biggest swing factors are real estate, buildout, and whether you start modestly or go full-scale immediately.
What’s the cheapest way to get into the daycare business?
A licensed in-home daycare using an existing suitable room is the cheapest path — often $2,000–$5,000 for minimal equipment, insurance, and the license. However, revenue is capped by legal child limits (often 5–8 kids), so profit scales with owner-operator effort, not footprint.
Are there special financing options for opening a daycare?
SBA 7(a) and microloans are common; some states offer child care startup grants, facilities loans, or reimbursement programs for children receiving subsidies. Many owners also borrow from home equity or retirement accounts, but debt service directly eats into already thin margins.
What ongoing costs catch new daycare owners off guard?
Staff wages and payroll taxes typically consume 45–60% of revenue, rent and insurance another 15–25%. Food, supplies, and licensing fees recur steadily. Many first-time owners underestimate the cost of substitute staff, compliance updates, and professional development required to keep a license.
What hidden costs will my business plan overlook?
Hidden costs include regular facility safety upgrades (fire marshal inspections often demand changes), steep background-check fees for every new hire, and bad-debt write-offs from parents who skip town. There are also indirect costs in covering a classroom when a teacher calls out sick and no substitute is available.
National Census establishment data was not available for this category. Cost and margin figures are informed estimates drawn from public industry sources (trade associations, government labor/business statistics, industry reports) combined with real Google Ads search-demand data. They are directional, not audited — actual costs and margins vary by market and operator. Updated July 2026. Read our methodology →
Buying a daycare? Due diligence checklist →
Founder of IdeaCrystal. Previously founder & CTO of Geonode and Repocket.
Connect on LinkedIn →DIRECTIONAL RANGES, NOT YOUR NUMBERS
Does Daycare make financial sense for you?
These are directional ranges, not your specific numbers. Run the numbers on your exact plan (real demand, competitor pricing, operating costs, and break-even) before you commit this kind of capital.