Written by

Jennifer Carlson

May 15, 2025

Edited by

Tamatha Hazen

Fact-checked by

Kristen Cramer

How to open a home daycare

If you're wondering how to start an in-home daycare, we've got you covered! Starting a home daycare requires careful planning, attention to detail, and a genuine love for children. By following the steps in this guide, you'll create a safe, successful, and rewarding business in your own home.

1. Research & planning

Start by understanding your state and local regulations. Each area sets its own requirements for home daycares, including licensing, safety standards, and adult-to-child ratios. Research the demand in your neighborhood and decide what age groups you'll serve. Then create a daycare business plan outlining your goals and budget.

Education

Most states don't mandate a college degree to start a daycare, but having some education or training in early childhood development is strongly encouraged. Certain licensing agencies require you to complete child development courses or earn a Child Development Associate (CDA) credential before you start.

Some states set a high school diploma or GED as the minimum educational requirement. If you want to run a larger daycare or employ staff one day, your employees may need an associate's or bachelor's degree in early childhood education. Maintaining your license may also require ongoing professional development training.

Funding & grants

Starting a daycare, even on a small scale, is an investment. You'll need to buy toys, food, cots, babyproofing supplies, and more. Luckily, the U.S. Office of Child Care provides grants to many licensed child care programs across the country, which can help offset your costs.

Reach out to your state's Child Care and Development Fund (CCDF) Administrators for support. They can connect you with helpful resources, guide you to available grants, and assist you throughout the application process.

Pricing

After you're familiar with the rates of other daycare centers nearby, you can figure out how much to charge for in-home daycare and set your rates. In-home daycare costs $540 to $1,000+ per month on average, depending on the age of the child and the location.

In-home daycares normally charge less than bigger centers because your overhead costs are lower. However, that can work in your favor! Some parents prefer home daycares because there are fewer kids there than in large centers.

2. Licensing & certification

You must secure the proper licenses for your state before opening your doors. Contact your state's child care licensing website to learn about:

• Required training (CPR, first aid, child development)

• Background checks for all adults in the home

• Home inspections for safety and cleanliness

• Health and immunization records for you and your family

Getting a license for a home daycare is simpler than a large daycare center, but it still requires careful attention. Most states limit the number of children in a home daycare to 4 to 12.

Health & safety

Daycares must follow strict health and safety rules, including staff background checks, first aid training, safe sleep practices, and maintaining clean, childproof spaces. Proper food handling, managing allergies, and enforcing sick child policies also protect children's well-being.

Providers must secure entrances, conduct emergency drills, keep immunizations current, and ensure adequate space. These measures create a safe, healthy environment where children can learn and grow confidently.

3. Prepare your home

Make sure you're complying with local zoning laws and HOA rules, if applicable. Transform your space into a safe, welcoming environment and dedicate a specific area for child care activities. Remove hazards, install safety gates, and lock away cleaning supplies and medications.

• Set up age-appropriate toys and learning materials

• Provide child-sized furniture

• Create separate areas for play, naps, and meals

To help balance your personal and professional life while working from home, set clear boundaries. Establish routines that help transition between daycare hours and your family's private time. This will help your home run smoothly and keep you from feeling overwhelmed.

Insurance

Before opening your daycare, protect your home and personal assets with the right insurance. At a minimum, you should have:

• General liability insurance

• Professional liability coverage

• Homeowner's insurance endorsement (if required)

• Workers' compensation (if you hire staff)

See our Home Daycare Insurance guide for more details. If you're not sure what's required in your area, consult with an insurance agent to ensure you have the right coverage.

4. Choosing a name

Pick a daycare name that shows what you stand for and attracts local families. Choose something easy to say, remember, and spell, like "Little Scholars" or "Bright Beginnings." These names sound friendly and suggest learning and care.

Before you decide, make sure no one else is using the name or has trademarked it. Try to get a matching website address and social media name so parents can easily find you online.

Example names

Our Daycare Name Ideas guide features more than 100 original names for childcare centers! Choose a name that reflects warmth, positivity, and the age group or style you plan to focus on. Here are some creative examples:

• Precious Sprouts Family Daycare

• Storybook Home Childcare

• Sunshine Circle Family Daycare

• Heartfelt Home Childcare

• Happy Haven Home Daycare

5. Setting up your business

Writing a thorough daycare business plan can help you stay organized and impress potential investors or funding partners. A great business plan should include your mission, your philosophy for childcare, your goals, and a detailed budget. It should cover rent, supplies, income, and licensing fees, plus a description of all the services you'll offer.

Create policies

Clear policies help your daycare run smoothly and professionally. Write a contract or handbook to show parents before they enroll their children. This should cover the following subjects:

• Hours of operation

• Fees and payment schedules

• Age groups you serve

• Meal or snack plans

• Tutoring (if applicable)

• Sick child policy

• Discipline procedures

• Emergency plans

Marketing

Let your community know you're open for business! Offer tours to interested families and highlight your safe, nurturing environment. Use a mix of online and offline marketing strategies:

• Create flyers and post them at local businesses

• Join TrustedCare for access to more clients and business tools

• Set up a simple website or Facebook page

• Ask friends and family for referrals

• Register with local child care resource agencies

Pros and cons of setting up a home daycare

Opening a home daycare offers a cozy, flexible, and often more affordable childcare option for families, but it also comes with unique challenges. Understanding both sides can help you decide if this path fits your goals and lifestyle.

FAQs about how to start a daycare from home

What are the requirements for home daycare?

Each state has different rules for opening an at-home daycare, but the most common ones are:

• Be at least 18 years old

• Have a high school diploma or GED

• Complete required training

• Pass background checks and fingerprinting

• Get a medical clearance from a doctor

• Attend a licensing orientation

• Pass a home safety inspection

• Provide enough indoor and outdoor play areas

• Follow state rules for child ratios

• Keep immunization records up to date

• Have clear policies for meals, emergencies, and daily routines

• Apply and pay licensing fees

• Undergo regular inspections and renew your license

For a more detailed explanation, read our guide on in-home daycare requirements!

How much do home daycares make?

Home daycare providers in the U.S. earn around $14 to $19 per hour nationwide. This translates to an average of $500 to $2,000 per week, depending on the number of children enrolled, your location, and any overhead expenses.

Can you run a daycare in a rental home?

Yes, you can run a daycare in a rental home in many states, but requirements vary by location. In California, for example, landlords cannot refuse to rent to you or evict you just because you operate a licensed family child care home, even if your lease says "no businesses."

In some states, you need your landlord's written permission and may need to show proof of liability insurance. Always check your state and local regulations, inform your landlord, and meet all licensing requirements before starting a daycare in a rental property.

Can an HOA regulate a daycare?

Yes, HOAs can set rules or restrictions on daycares according to their bylaws and state laws, but state protections for home-based childcare may limit their power. Always check your HOA's rules and talk to an attorney or your state licensing agency before opening a daycare in an HOA community.