Thinking of Becoming a Foster Parent? Here’s How the Finances Shake Out

A parent and child hold hands.
If you decide to become a foster parent, you won't be on your own financially. State agencies cover many costs. Tina Russell/The Penny Hoarder

Choosing to become a foster parent is a significant decision.

And it isn’t just a significant emotional decision — it’s also a significant financial decision.

If you’ve weighed the emotional costs and are prepared to open your home to children in the foster-care system but are scared of the financial aspect, you don’t have to be.

Foster care will take a lot of emotional work on your part, but it won’t bleed you dry financially.

If you’re serious about becoming a foster parent and you’re able to meet your household expenses, finances don’t need to be a roadblock.

It is, however, important to note one thing:

In some situations, you may end up paying more money than you will receive from the state to support a foster child — especially if you choose to go above and beyond.

Either way, if you are maintaining a good standard of care, you will not be profiting at all. (But that’s OK, because if you’re only in it for the money, you really shouldn’t become a foster parent.)

It’s not an inexpensive endeavor, but, if you’re certain about bringing foster children into your home, the assistance you will receive from the state should make it doable.

The Up-front Costs of Becoming a Foster Parent

Prior to opening your home to a child or children in the foster care system, you’ll encounter a series of up-front costs and financial requirements.

Income Requirements

Generally, you’ll be required to have a sufficient income before becoming a licensed foster parent. While most states do not have a specific income threshold, your household income should be enough to cover basic care and necessities and meet any current financial obligations for you and the people in your home.

Without counting the financial aid you will receive for fostering a child, you should be able to cover your rent or mortgage, general bills (such as utilities) and food and clothing for your family and any children who may be placed in your home.

You will most likely have to provide financial records like tax returns or pay stubs to confirm your household is financially secure.

Pre-service Training

Before you can become a licensed foster parent, you will need to take pre-service training classes.

These classes are generally a crash course in everything from parenting and safety to dealing with emotional trauma. You’ll also learn how to navigate the foster care system from within and how to work with a child’s team — the social workers, relatives and just about anyone else who has a role to play in the child’s case.

Usually, pre-service training consists of four to 10 sessions over as many weeks, although the number of hours required varies by state.

These courses are often inexpensive or free, and some states will reimburse you for fees for pre-service training.  

Health and Background Information

You will also be required to undergo health and background checks before a child can be placed in your care.

Generally, you will be responsible for paying any associated fees for office visits, fingerprinting or paperwork submissions, although some states offer assistance or reimbursements.

Home Study and Safety Updates

Some states will require you to have a home study done.

Again, most home studies will be done for free or for a nominal fee, but it is the preparation for the home study and safety check that may cost you out of pocket.

In the majority of states, you are required to have working smoke detectors installed near sleeping areas and portable fire extinguishers on hand. (Many state agencies will supply these for free.)

You most likely also will be required to install other safety equipment throughout the house, like a thermometer in the refrigerator, a fence around the pool and an accessible landline telephone.

If you’re going to be fostering young children, you should also have general baby and toddler safety features installed in your home, such as cabinet and drawer locks and baby gates at the top and bottom of the stairs.

Equipment and Care Items

While you will be reimbursed for certain care items over time, it will be your initial responsibility to outfit your home in a way that meets the needs of the child or children you will be welcoming.

Some children will arrive with a bag of clothes and personal possessions, and some will arrive with nothing.

You should have supplies on hand to clothe, feed and house a child for at least the first few days until you can secure adequate clothing and personal-care items.

If you will be fostering babies or toddlers, you should have the proper bed, dishes, high chair, bath tools, stroller, car seat — anything a child that age might need — ready to go as soon as a child arrives in your home.

While not a requirement in every state, you’ll most likely also need to have reliable transportation and vehicle insurance to transport children to doctors’ appointments or family visits.

You Won’t Be on Your Own Financially, Though

Your state agency will help you care for the children placed in your care by providing financial assistance.

General Stipend

States give anywhere from about $10 to $40 a day — between $300 and $1,200 per month — depending on the age and needs of each child.

In Florida, for example, as of January 1, 2018, a foster parent would receive a monthly stipend of $457.95 for a generally healthy newborn to 5-year-old, $469.68 for a child between the ages of 6 and 12, or $549.74 for a child 12 to 21.

These general subsidies cover five main categories of care: food, clothing, housing, transportation and personal, (which includes things like school supplies, books, entertainment and personal-hygiene supplies).

In many states, children under the age of 5 are also eligible for WIC, the federally funded supplemental nutrition program for women, infants and children.

Some states also include a separate, one-time payment to help cover initial expenses like clothing and toiletries upon a child’s arrival in your home.

Generally, stipends are mailed by check every month.

Health Care

Nearly every child in foster care is eligible for Medicaid, which includes preventive, screening, diagnostic and treatment services, as well as mental and behavioral health care.

You should not have to absorb the cost of any medical expenses for a foster child in your care; your agency will take care of any extra costs and should work with the health care provider directly.

Day Care

Most states cover day care costs for children younger than school age in families where a single parent has a full-time job or in dual-parent households where both parents work full time. Parents who work full time from home or who are enrolled full time in school may also be eligible to receive child care assistance.

In most cases, you may send the child only to a state licensed child care facility. Once the child is enrolled, the state will usually pay the day care center directly.

However, if there are discrepancies (for example, due to a child being enrolled at a weekly or monthly rate and then attending the day care facility on a daily rate because of a change in schedule), you may be required to pay the difference. In some instances, it can also be difficult to secure paid child care if two parents work opposite shifts or schedules.

Most states do not cover after-school care for school-age children or summer care when school is out. Be sure to ask your caseworker for options when it comes to after school or summer care, however, as there may be organizations or programs in your area that can help.

Respite Care

Most states limit to just a few hours the amount of time a foster child can be left with a babysitter or family member who does not meet certain qualifications.

If the foster parents need to be away for more than a few hours (say, a day-trip for a family funeral), they would need to place the foster child in respite care even if they had arranged adequate care for a biological child at a relative’s home.

Respite care is offered through the state, and can last anywhere from a few hours to a few days. It’s usually provided by people who are either certified to foster children themselves or who have been specifically trained to provide respite care.

Generally, respite caretakers are paid through the state at the state’s daily rate for a foster care placement. Occasionally, it is up to the foster parents themselves to pay the respite caretakers that sum. Some states limit the number of paid respite days a foster family is entitled to each year.

While foster parents are encouraged to make their foster children feel like a seamless part of the family — which includes outings, vacations and family events — certain situations won’t allow for total inclusion.

Because a child’s biological parent often has the final say on whether or not the child can travel out of the area or miss visitation sessions, foster parents occasionally face missing important family events or not being able to help in emergency situations that arise for an out-of-town family member.

Respite care ensures that foster families are able to carry on with their lives as normally as possible without experiencing burnout or shying away from taking in a foster child due to an upcoming event or planned and paid for trip.

Understand Your State’s Foster Care Rules and Regulations

Foster care rules and regulations vary by state, and sometimes even by county. While an overview of the costs associated with becoming a foster parent can help take the intimidation out of the process, for a full and accurate representation of the requirements and costs you’ll face, you should contact a local foster care agency for more information.

If you’re not ready to call but want more information on what you can expect your state to help you with, you can go here and use the drop-down menu to select your state. You’ll be able to see state-specific information on foster care, including local rules and resources and contact information for people who will help you get started.

If you want to learn how one foster mom has handled both the financial and emotional costs of fostering more than 25 children, you can read about her experiences here.

Grace Schweizer is a staff writer at The Penny Hoarder.