Do you have a passion for children and want to start a home daycare in 2023? Here are the steps necessary to get your daycare up and running.

How To Start a Daycare at Home in 2023: A Step-by-Step Guide

Do you have a passion for children and a desire to be your own boss? It could be the perfect opportunity to start a home daycare in 2023. With more families seeking infant and toddler care, now is an ideal time to open your own home-based daycare.

This guide will walk you through the steps necessary to get your daycare up and running. We’ll cover everything from licensing requirements based on where you live to how much money you should charge for services and marketing tips that can help you attract clients quickly. So let’s get started!

Step 1: Apply for a Home Daycare License

Even home daycare businesses need a license to operate. That’s why the first thing you need to do before anything else is to apply for a license with your local governing authority. Every state has different requirements and regulations to meet to obtain a license, so make sure to do your research before you apply.

One thing to keep in mind is that each state has a different licensing process. Some do everything in an online portal. Others are still using paper and pen. There are guides available to help you understand the necessary requirements to start a home daycare in each state. You can obtain these guides online.

In states like Massachusetts and New York, licensing can take up to two or three months. It involves online training, background record checks, and a home inspection. Plus, you will also have to file a lot of documents with the state licensing body.

It is important to understand that different States use different terminologies to describe home daycare. In most cases, it is referred to as Family Child Care (FCC) and the license application process is for a Family Child Care License.

Step 2: Setup and Prepare Your Home

Even before obtaining a license, you can start preparing your home and make it look like an actual daycare center. The reason for this is that the license isn’t just for you—it’s also for your daycare space. It’s also a lengthy process, as you will need to meet many health and safety compliance requirements.

Converting a part of your home into a daycare is pretty straightforward. However, you will need to think about how you want to set up your space. Consider the safety of children and plan where you will provide meals, rest times, and activities. Here are other areas that you’ll need to consider when preparing your home daycare space:

Kids Furniture

To create a safe and comfortable environment for children to play, rest, eat, and learn, you’ll need age-appropriate furniture such as playpens, toddler tables and chairs, cots, mats, and high chairs.

Equipment and Toys for Developmentally-appropriate Activities

To encourage children’s physical, emotional, and cognitive growth and development, you’ll need toys and equipment that promote age-appropriate skills such as fine motor skills, gross motor skills, problem-solving, creativity, and social interaction. These may include puzzles, building blocks, art supplies, books, musical instruments, and outdoor play equipment.

Nap Time Needs

Childcare providers are required to provide a safe and comfortable sleeping environment. You will need to provide individual cribs or cots for each child and fresh linens that are washed regularly.

Mealtime Supplies

You must provide children with healthy meals and snacks that meet their nutritional needs. This includes plates, bowls, cups, utensils, and bibs. You’ll also need a high-quality blender or food processor, bottle warmers, and a refrigerator to store breast milk and formula.

Entryway Items

To ensure that unauthorized people don’t enter your daycare, you’ll need a secure entryway with a sturdy gate or door with a lock, an intercom or camera system, and a sign-in sheet.

Bathroom and Changing Station

You’ll need a separate bathroom with a child-sized toilet, sink, step stool, and plenty of toilet paper, wipes, and diapers. You should also have a changing station that includes disposable gloves, diaper cream, diaper pails, and hand sanitizer.

Outdoor Space

Providing outdoor play opportunities is essential for children’s physical health and well-being. You’ll need a safe and secure outdoor area with a fence, age-appropriate play equipment, and shade.

First Aid Kit

You should always have first aid supplies in case of an accident or injury. Your kit should include bandages, gauze, antiseptic spray, and tweezers.

Other Essentials

In addition to the basics, you’ll also need to follow a variety of health and safety protocols to keep children safe in your care. These may include background checks for employees or volunteers, storing hazardous materials out of reach, and having a clear emergency plan.

Step 3: Establish Your Business

Now that you have a license and your home is ready to go, it’s time to establish your business. Here are some important steps to take to establish your home daycare business:

Become a “Sole Proprietor”

Establish your daycare business as a sole proprietorship, meaning that you are the owner and have complete control over your business operations. You must research your state’s requirements for registering your business and obtaining the necessary licenses and permits.

Apply for an Employer Identification Number (EIN)

An EIN is a unique ID number that the Internal Revenue Service (IRS) assigns to businesses for tax purposes. You must apply for an EIN for your daycare business, which you can do online through the IRS website.

Always Remember Your Taxes

As a business owner, you’ll need to pay taxes on your income and any employees you hire. Keep detailed records of all your expenses, including any supplies or equipment you purchase for your daycare business.

Get Insurance

It’s essential to have liability insurance to protect your business from any accidents or incidents that may occur on your property. Check with your insurance agent about what kind of insurance coverage you need for your home daycare business.

Starting a home daycare business can be a rewarding way to earn income while caring for children, but it’s essential to take these important steps to ensure that your business is legal, protected, and successful.

Part 4: Start Acquiring Clients

Once you’ve set up your home daycare business and are ready to start caring for children, the next step is to get clients. Here are some tips for marketing your home daycare business and attracting new clients:

Tell Your Story

Share why did you start your home daycare business and what makes it unique. Highlight your qualifications, such as certifications, experience, and training. You can create a website or blog to promote your business and showcase your services.

Set Up an Online Presence

Create social media profiles for your home daycare business on platforms like Facebook and Instagram. Share posts about your services, photos of your daycare space, and updates about what the children do in your care.

Spread the Word

Tell your family, friends, and neighbors about your home daycare business and ask them to spread the word. You can promote your business at local parenting groups, schools, and community events.

Start Acquiring Enrollees

Offer promotions or discounts to attract new clients. You can also offer a referral bonus to current clients who refer new families to your home daycare. Once you have clients, provide exceptional care to satisfy them. Happy clients can help generate positive word-of-mouth referrals for your business.

Remember, marketing your home daycare business requires effort and patience. Keep promoting your business, maintaining your online presence, and providing great care; clients will start rolling in. Good luck!

Step 5: Set Up a Billing System

Once you’ve started to acquire clients, it’s time to set up a billing system. Here are some essential tips for setting up your billing system:

Choose a Payment Processor

Choose an online payment processor like PayPal or Venmo to handle your payments. Make sure you select the right one for your business and that it offers features such as automatic billing and invoicing.

Decide How You’ll Handle Late Payments 

Establish clear policies on late payments upfront. Determine how you will handle late payments, such as charging a late fee or suspending services until the balance is paid.

Create Invoices

When billing clients, create invoices clearly stating your payment terms and fees. Include your contact information on all invoices in case clients have questions.

Set Up Automatic Reminders 

Set up automatic payment reminders to guarantee that your clients are paying on time. This will help you save time and avoid awkward conversations about late payments.

Use a Billing Software

Use billing software to track payments, create invoices, and manage your books. Good billing software will make keeping your finances organized and up-to-date easier. In addition, some software solutions offer additional features such as payroll, expense tracking, and analytics.

Try ReliaBills!

Running a daycare business at home has the same end goal as every other business: getting paid for your services. While you’ve got the hard work of caring for your clients covered, ReliaBills can take care of getting you paid with automated payments and invoices.

ReliaBills is a cloud-based invoicing and billing software designed to automate payment processes, reduce administrative overhead, and streamline payment processing duties. ReliaBills’ payment processing features include automated recurring billing, payment tracking, payment reminders, online payment processing, and much more!

ReliaBills also provides valuable tools that help manage customer information, monitor payment records, and create proper billing and collection reports. As a result, invoice and billing management are simple and convenient. You also get access to active customer support, ready to assist you whenever you need help.

Get started with ReliaBills for free today! And if you want more features, you can upgrade your account to ReliaBills PLUS for only $24.95 monthly! Subscribing to ReliaBills PLUS will give you access to advanced features such as automatic payment recovery, SMS notifications, custom invoice creation, advanced reporting, and more!

With ReliaBills, you have an all-in-one solution to your invoicing and payment processing needs. Our convenient solutions will enable you to focus more on running and growing your home daycare business. Get started today! Visit to learn more.

Wrapping Up

Just as there are no shortcuts to success, opening and operating a successful home daycare business isn’t easy. You will need to be willing to put in the work. But if you follow our guide and use the right tools, such as ReliaBills, you’ll be better positioned to start and grow your home daycare business. Good luck!

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