Business development

How to create a childcare center budget plan

Plus, a free editable childcare budget template
create a childcare budget
June 3, 2024
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In a rush? Here's a quick breakdown.

  • It might be boring, but we can all agree that having an annual budget is critical to having a successful childcare center.
  • Learn what to include in your budget and some top tips to make them even more accurate and insightful.
  • Free childcare budget template made just for you -- Simply download and edit. We did the most tedious part for you!

It’s probably one of your least favorite parts of the job, and the word itself - "budget" - probably instantly makes you think of boring spreadsheets and number-crunching. But still, we all know how important it is to have a solid annual budget for your childcare center. Not only does it keep things running smoothly, but it also ensures that you can provide the best care possible for the kiddos. 

Also, we have created an editable childcare budget worksheet for you, which you’ll find at the end of this article. So basically, the most tedious part is all done for you! Everything is set up. You just have to add your numbers and edit some information so it’s best for your center. 

Before you get to that free preschool budget template, let's talk about why an annual budget is so crucial and what to include in one.

teachers meeting and making a childcare budget

Why an preschool annual budget matters

Financial stability

Imagine running out of funds halfway through the year and not being able to pay your staff or buy essential supplies. An annual budget helps you plan your finances in advance, so you know exactly how much money you have and where it’s going and where it’s coming from. This way, you can avoid any surprises and keep your childcare center financially stable.

Resource allocation

A budget allows you to allocate resources efficiently. At a preschool or childcare center, there is a wide variety of expenses to consider, like paying salaries, buying educational materials, or updating your playground, or planning an open house for the community. 

Knowing how much you can spend in each area helps you make the most out of your resources, and make informative decisions with how much to allocate to where. It ensures that nothing important gets left out and that you can provide a well-rounded experience for the little ones.

Goal setting and planning

Setting goals is essential for growth and improvement. With a budget, you can set realistic financial goals for your center. Maybe you want to hire more teachers, add another toddler classroom, or even expand and open another center. An annual budget can help make that attainable. You can have a better understanding of how much money to set aside, and easily track your progress throughout the year.

Transparency and accountability

Having a detailed budget promotes transparency and accountability. When everyone involved knows where the money is coming from and where it’s going, it builds trust among staff, families, and stakeholders. 

While focusing on each child’s growth and development is critical to a successful childcare program, you can’t forget that simultaneously, a preschool or center is a business. An annual operating budget shows that you’re running a professional and well-organized operation, which can attract more families to your center, and boost your revenue.

daycare budget template

Preparedness for unexpected expenses

Life is unpredictable - especially when working in early childhood education. There is never a dull moment as the kiddos are constantly exploring and engaging with unfamiliar objects and stimuli. Maybe a child accidentally ripped a bean bag and the beads are getting everywhere, or maybe screws are becoming loose on the playground, or maybe you need more staff. An annual budget allows you to set aside an emergency fund to cover these unforeseen costs without disrupting your regular operations.

Better decision making

When you have a clear financial picture, making decisions becomes easier. You can assess whether you can afford to introduce new programs, hire more staff, or invest in better facilities. This helps you avoid making hasty decisions that could strain your finances, and make you have to cut corners in your regular operating budget.

Future-oriented roadmap

An annual budget is more than just a financial plan; it’s a roadmap for the future of your childcare center. It helps you navigate the ups and downs, ensures you can provide high-quality care.

What to include in a childcare annual budget template

Now that we’ve covered why having an annual budget is so important, let’s get into the nitty-gritty of what should be included in one. 

Creating a budget might seem daunting at first, but breaking it down into these categories makes it more manageable. Start by listing all your income sources and estimate the total amount you expect to receive over the year. Next, itemize all your expenses, both fixed and variable. Be as detailed as possible to ensure you don’t miss anything.

a woman making a childcare budget on her laptop

Here's a simple bullet list to guide you (and all of these categories you will find in the daycare budget template below):


  • Tuition fees: It helps to break it down into monthly payments (as we do in the template provided below). It is easy to break down by half-day and full-day attendance if needed, and also, make sure to include additional services like after-school programs, if relevant.
  • Government subsidies and food programs
  • Registration fees
  • Fundraising
  • Grants 
  • Donations


  • Salaries and wages
  • Benefits
  • Professional development and training: Workshops, trainings, certifications, etc.
  • Operational expenses: This includes costs like rent/mortgage, property taxes, electricity, water, gas, internet, and other utilities.
  • Classroom supplies: Art supplies, toys, and any other educational materials for both the children and the teachers.
  • Food and nutrition
  • Technology: Like childcare management software, tablets and computers. 
  • Marketing and advertising
  • Insurance: Property insurance, liability insurance, etc.
  • Miscellaneous: This is where you should include emergency funds, maintenance and repairs, and anything else necessary for your preschool or childcare center. 

Putting it All Together

Last, but definitely not least: calculate your total revenue and your total expenses. Then, subtract your total expenses from your total revenue. This is how much your total annual income will be!

Ideally, your income should be higher than your expenses. If not, you’ll need to look for areas where you can cut costs or find ways to increase your income. Remember, the goal is to create a balanced budget that allows your childcare center to operate smoothly and grow sustainably.

Some final tips for successful budgeting

Regular reviews: Don’t just create a budget and forget about it. Review it regularly, at least quarterly, to ensure you’re on track and make adjustments as needed.

Involve your team: Get input from your staff. They might have insights into certain expenses or ideas for cost-saving measures.

Be realistic: It’s important to be realistic with your numbers. Overestimating income or underestimating expenses can lead to financial trouble.

Use tools: There are plenty of budgeting tools and software available that can make the process easier and more efficient (like Famly, which has all the financial tools, reports and data you would need to budget)

Plan for the future: Always keep an eye on the future. Consider how your priorities and needs might change and prep accordingly.

Now, what you probably clicked on this article for…

Free childcare budget template. Just download and add your childcare center’s numbers!

childcare budget template

The big ideas

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Official Danish Government Reopening Advice

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UK Nursery Covid-19 Response Group Recommendations

The full recommendations from a working group of over 70 nursery chains in the UK.

Please note: here at Famly we love sharing creative activities for you to try with the children at your setting, but you know them best. Take the time to consider adaptions you might need to make so these activities are accessible and developmentally appropriate for the children you work with. Just as you ordinarily would, conduct risk assessments for your children and your setting before undertaking new activities, and ensure you and your staff are following your own health and safety guidelines.

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