Understand the Financial Impact of Being a Foster Parent

As of 2023, about 343,000 children were in foster care in the United States on any given day.  They are providing these children with a place to stay and some guidance in a life that has likely been fairly hectic up to this point, as foster parents.

Many potential foster parents may not be thoroughly familiar with all of the ins and outs of the foster care system, namely, here in Virginia.  Just as raising, nurturing, and caring for any child, becoming a foster parent has financial implications; we will go into great depth to help you understand all the economic impacts and benefits of being a foster parent. 

If you are considering the prospect of foster care, read on to understand the financial impact of becoming a foster parent.

The Necessities of Being a Foster Parent

While there are many requirements for foster children, there are some simple human necessities that you should consider for foster kids (or any kids, for that matter).  Let's take a quick look at these seemingly obvious necessities before delving into the details regarding financial responsibilities.

Food

While children seven and under may not require the same caloric intake as teenagers, they are still growing children who need to be fed nutritious foods to support healthy growth and provide energy and nutrition to maintain an active lifestyle.

The average cost of feeding a five-year-old child in America is approximately $150 per month, depending on one's thriftiness and the child's dietary preferences.

This doesn't include extras like the occasional pizza night, treats, or eating out. These factors will likely push the total closer to $200 per month.

Providing foster kids with a nutritious meal shouldn't be expensive. Old tricks, such as sticking to the outside aisles of the grocery store and clipping coupons, can make nourishing meals affordable for foster children.

Food Assistance Programs

The Virginia Department of Social Services provides food assistance programs to eligible families.  In conjunction with the USDA, the VDSS offers a Supplemental Nutrition Assistance Plan (also known as SNAP).  This program may make you ineligible for foster parenting, as foster parents must be financially stable to support themselves and the foster children.

Transportation

An ability to provide some transportation is not just vital for everyday life; it's essential when you have children in foster care in Virginia in your care.  As we all know, children are prone to accidents no matter their age, and it is an absolute necessity to have the ability to get the child or children to the hospital or another emergency service as needed.  If you do not have a car when being licensed, this may hinder your steps to becoming a foster parent.  However, working with your home study team to develop a strong vehicle plan before a foster youth comes to your home can help address this issue.  All Foster care programs will carefully look for this in the home study process and pre-service training.

School and Extracurriculars

Even if you choose to homeschool the child, you have been entrusted with the task of fostering.  It's essential to have the ability to socialize the child with other kids their age. This is an expectation of foster care in Virginia, and you will receive a monthly allowance to help offset the costs.

Many parents and foster parents choose to engage their children in extracurricular activities, such as a youth sports league, Boy Scouts, Girl Scouts, or another civic youth organization. 

There should also be some time for physical play and education, such as visiting a State Park or local Children's Museum - all of which require some form of transportation. If you live in an area with predominantly public transit, you should check the local or state laws regarding requirements for children on public transport (car seats, restraints, etc).

Car Payments

If you own or lease your vehicle, you should also consider your car payments and fuel.  A multi-passenger used sedan in 2022 can still cost upward of $35,000, or about $500 per month for six years.

This can become a burden to even the most frugal of families.  Hence, a close examination of your monthly expenditures is vital for transportation before entering the foster care system.

Transportation Reimbursements

In addition to other financial assistance listed below, foster parents may also be eligible for transportation reimbursement.  This reimbursement may be claimed when a foster child requires medical care at a facility for primary or emergency care and is reimbursed on an as-used basis.  In Virginia, this is very hard to receive, but in other states, it is mandatory to use these services.

Education

Some foster parents might prefer homeschooling due to the sometimes unpredictable length of a foster child's stay. However, this is not allowed in Virginia. The public school system must be utilized unless a child has an IEP that states a private school provider may be used.

Public School

Because homeschooling is not permitted for foster children in Virginia, foster parents must conduct thorough research regarding the costs of public schools. Financial considerations for public schools include:

• Textbooks
• School lunch
• Clothing/Uniform Requirements
• Additional School Supplies
• Toiletries
• Medical care for infectious diseases/parasites
• Technology
• Book fairs/extracurricular fees
• Concessions
• Field Trips
• Musical Instruments

Allowance

This word is in the Top 10 Favorite List of every kid's vocabulary. While allowances can be taken for granted, they are a fantastic way of teaching children how to work for the things they want. It is also an excellent way to teach them the basics of accounting and banking principles. 

That said, foster parents have to set limitations, or allowances can get pricey. Check out this allowance guideline from Scholastic for kids under 10 to understand what we mean. 

While that allowance money isn't likely to break the bank, it should be a consideration for foster parents when deciding what the most important lessons to pass on to a child in their care are. 

Healthcare Costs

As with any family, child, or individual, healthcare costs will be a concern regarding the financial impact on a family or child's welfare.

Foster children up to 18 years old are eligible for Medicaid benefits, as per the Virginia Department of Medical Assistance. If they are enrolled at age 18, they remain eligible until the age of 26. 

There are also physical and mental requirements to be licensed as an eligible foster parent. While those requirements are not readily available, you need space in your home and a willingness in your heart to foster children. While these may not fall directly under "healthcare costs" for you personally, there are some exceptions. 

If you or your co-parent has a severe chronic physical or mental issue, there may be additional steps to take depending upon the specifics of the situation. Ultimately, we want to ensure that foster children are placed in a home where they can be adequately cared for in all aspects of their developing lives. 

So how might this have a financial implication? The foster parents may be asked to provide medical histories and submit to physical and other fitness tests before being approved.

While most of the said tests are free of charge or covered by Medicaid or reimbursement, there may be additional charges depending upon the provider or the county in which you receive the tests.

Prescription and OTC Medications

Once again, depending upon the Medicaid status and the child or foster parents' needs, prescription and over-the-counter medications will likely be highly affordable. This is not to say that there won't be an outlier or two, but in most cases, the financial impact of purchasing standard prescription and over-the-counter medications should be low. 

Monthly Stipend For Foster Parents

There is a multitude of assistance for foster parents in Virginia. One of the most common questions that new or prospective foster parents have is, "Do I get paid to be a foster parent?"

The answer is both "yes" and "no." There is no intention of making a profit from taking in foster children. However, the Commonwealth of Virginia and many other states offer monthly stipends to help offset certain costs associated with caring for foster children. 

First, let's take a quick look at the things that may be eligible for assistance with the monthly stipend. Then, we'll delve into the details of each one to provide you with a clearer understanding of the financial implications of being a foster parent. 

Monthly stipends and added benefits for foster parents include (but are not limited to):

• Standard Maintenance Costs
• Clothing
• Enhanced Maintenance Payments
• Medicaid
• Contingency Fund For Property Damage
• Respite Care

Standard Maintenance Costs

While this may sound like a fee for having your oil changed, it is actually much more impactful. Most foster parents rely on this stipend to help offset the cost of caring for a foster child, and while it can be broadly interpreted, there are specific expenditures it is meant to cover. 

This stipend is meant to help cover the cost of food, clothing, school supplies, shelter (i.e., rent, mortgage, etc.), insurance, and other "incidentals," according to the Virginia Department of Social Services.

The allowance for clothing and food can differ based on the child's age, as older children often require more expensive clothing and more food to keep their bellies full. 

Clothing

We hit on it above, but clothing can be a significant expense! That's why there is an eligible additional benefit depending on the age and needs of the foster child.

Enhanced Maintenance Payments

Some children in the foster care system may require special needs. As a result, there are built-in enhanced maintenance payments to support foster parents who are kind enough to care for these children. 

These payments can be used toward special medical equipment or medications that may be needed beyond specific Medicaid allowances, as well as for special transportation, education, and other services that can help make the child's transition to a new care provider easier and more comfortable for both the child and foster parents.

It is essential to remember that these payments, allowances, and stipends are in place to support the fostering of children. They are not meant to cover the total cost of childcare. 

Daycare

Another high cost that prospective foster parents should consider is the cost of daycare if both of the foster parents are employed full-time. While daycare costs in the United States are surging, Virginia also helps cover these costs for foster parents. While not directly stated in the benefits for foster parents, monthly maintenance payments can be used to supplement daycare for foster children. 

Where not eligible, foster parents can explore other government aid options, such as Head Start, or they may choose to pay for the child's daycare out of pocket.

Foster Care Tax Credits

Foster parents can claim extra tax deductions depending on the number of children they have fostered in any given year. In 2021, the maximum tax credit for foster parents was $4,000 for a single child and up to $8,000 for two or more children through the Child and Dependent Care Credits. This is in addition to the federal Child Tax Credit. 

It is again important to remember that this tax credit is in addition to the multiple other government assistance stipends and programs offered to foster parents. 

Comprehensive Breakdown of Payments and Benefits

The sheer number of financial benefits involved with becoming foster parents in Virginia can be genuinely head-spinning. Let's take a moment to regroup and review what we've covered before summarizing the benefits of foster children.

Because (as aforementioned) most of the benefits are based on the child's age, they can differ somewhat. Read on for the details.

Maintenance Payments

For children aged 0 to 4 years old, payments for clothing and other out-of-pocket necessities are slightly lower; the rate increases as children age.

Foster parents in Virginia will receive in 2022

• Room and Board for children 0-4 years: $339 per month
• Room and Board for children 5-12 years: $388 per month
• Room and Board for children 13+ years: $470 per month 
• Clothing for children 0-4 years: $60 per month
• Clothing for children 5-12 years: $80 per month
• Clothing for children 13+ years: $124 per month 
• Personal Care, Recreation, and Reading for children 0-4 years: $95 per month
• Personal Care, Recreation, and Reading for children 5-12 years: $102 per month
• Personal Care, Recreation, and Reading for children 13+ years: $109 per month
• Monthly allowance for children 0-4 years: $0 per month
• Monthly allowance for children 5-12 years: $10 per month
• Monthly allowance for children 13+ years: $32 per month

This equals out to the following total monthly payment rate for regular maintenance per foster child:

• Children ages 0-4 years old: $496 per month
• Children ages 5-12 years old: $580 per month
• Children ages 13+ years old: $735 per month

Exceptions and Unfortunate Circumstances

Sometimes, when a child has been in the foster care system for an extended period or has undergone some previous trauma, there can be significant challenges for foster parents. This is why it takes very patient and loving people to open their homes to foster children. 

Property damage contingency payments are for unfortunate circumstances where an accident or intentional incident occurs involving a foster child. These events are exceedingly rare, but this is intended to safeguard foster parents from severe financial harm resulting from property damage.

Maintenance payments are made to foster families in the absence of a foster child who has been gone for less than 14 days. This covers the time limits for respite care, runaways, or other acceptable exceptions. 

It is also essential for foster parents to note that foster children placed in a home on a trial basis are not eligible for maintenance payments or other stipends until a final agreement is settled. 

Common Out-of-Pocket Costs For Foster Parents

As with any childcare, there will be unforeseen out-of-pocket costs that arise from time to time. While these shouldn't be substantial and are left solely to the discretion of the foster parents, they can range anywhere from a trip to an amusement park to an extra set of crayons. 

What happens when they need that emergency dental work after taking a dodgeball to the mouth in Physical Education Class? Or what about that recorder they need for Music class that you didn't know was required until the night before they need it? These are, again, just a few examples of out-of-pocket costs, so get ready for parenthood!

Again, the examples are too many to pin down just a few. Out-of-pocket costs won't be substantial after considering the monthly maintenance payments. 

What If I am Fostering a Relative?

Relatives can be considered eligible foster children under specific circumstances. According to the Kinship Care Program, administered by the Department of Social Services in Virginia, there are multiple ways for a close relative to care for and foster a child who may have been removed from another relative's home. Various resources and answers to Frequently Asked Questions can be found here.

Financial and Background Requirements For Foster Parents

As you may have suspected, there are also stringent financial and criminal history requirements for obtaining a foster parent license. While many of these can be resolved or explained without future financial implications, past decisions can be vital during an evaluation. 

All members of the foster family living in the home must undergo a background check of some level. Some things to consider and expect in a financial background and criminal background check for potential foster parents include (but are not limited to):

• All required paperwork is submitted and; 
• No criminal traffic convictions (misdemeanors and felonies)
• Ability to show substantive and sustainable income
• No sex offender history
• No convictions or guilty pleas for assault or other domestic issues

Documentation Needed and Associated Fees

While many of the following examples of documentation can be obtained free of charge, there is typically a nominal fee for obtaining copies from the issuing authority. Regardless, they are all required to become a foster parent in Virginia:

• Birth Certificate
• Social Security Cards or Numbers
• Medical Records
• Vaccination and Immunization Records
• Proof of Citizenship
• Proof of pets in the home and required vaccinations therein
• Marriage Certificate (if legally married)
• Other documentation stating the marriage status
• Current lease or ownership information
• Assets housed in a banking institution
• Assets (including property) outside of a banking institution

Home Modifications After Inspection

A significant step toward becoming a foster parent is opening your home to an inspector to ensure that the living conditions are satisfactory and safe for any child entering and living within said quarters. If any safety hazards are identified, it is not the end of the world.

Most inspectors will provide suggestions (albeit substantial) to potential foster parents on changes that should be made to their home to make it a safer space for the foster child. These hazards run the gamut from the obvious, such as unlocked cabinets, to something that most new parents wouldn't initially think of, like baby gates or other barriers at the bottom and top of a staircase.

In more egregious situations, inspectors may require a specific change to be made to the home before they approve the child's placement. For instance, if a pool, a fence, or some other safety barrier needs to be purchased and installed. The inspector will also look for smoke alarms and carbon monoxide detectors - are the batteries all up to date and the alarms operable?

For example, if a wood stove heats the home, it stands to reason that it will get very hot when in use. The inspector may require that you erect a barrier or a sturdy baby gate at a minimum to keep small children from being harmed by the wood stove. Again, this is just one small example to give you an idea of the types of things that may be asked of new foster parents.

These modifications may have a fraction of the financial impact, but most alterations can be reimbursed using monthly maintenance payments. 

Commonly Missed Safety Hazards For Foster Kids in Foster Care

While every home and every child is different, there are some common safety hazards you should check for and mitigate before a home inspection. These can have a significant financial impact, depending on the severity, so it's critical to cover your bases.

• Childproof hardware for cabinets
• Childproof hardware for furniture and corners
• Childproof electrical plug covers
• Operable door and window locks
• Operable door and window screens
• Presence of lead paint
• Presence of asbestos
• Smoke-free home
• Firearms are locked up and out of reach
• Safe and friendly pets
• No sharp objects lying around
• Operable heating and cooling apparatus
• Enclosed or otherwise safe lawn space

Other Financial Concerns After Inspections/Interviews

If the child is small enough to be legally still required to use a car seat or booster seat, you should be prepared to prove that you can accommodate this need. As with the other examples above, this can be mitigated by monthly maintenance payments. However, they can become stretched thin, especially at the beginning of foster care, as they prepare to care for the foster child. 

Foster parents should also expect and prepare for other members of the household to be interviewed, including juveniles, to determine the compatibility of each child and their needs for each respective home.

While this may not seem like a monumental financial impact, family members may sometimes be asked to provide proof of therapy, mental health diagnoses, and other issues that may require expenditures on the potential foster parents' behalf. It may also require the foster parents to take some time off work to facilitate these needs.

Cost of Court Hearings and Attorneys

Most of these fees will be covered by the Commonwealth of Virginia. However, extenuating circumstances may require the foster parents to incur some of the costs, for example, if it is a kinship claim against one of your family members or another complicated situation that requires additional work on the part of an attorney or the court system. If child protective services are involved, and the foster child you are looking after comes from a home where abuse and neglect have occurred, court costs will be covered by the Local Department of Social Services.

The Average Cost of Raising a Biological Child

We briefly mentioned it before, but the financial impact of becoming a foster parent is significantly less than raising a biological child. That is not to say that having children is a bad idea, but rather for comparison for prospective foster parents. We've thrown a lot of big and potentially scary numbers at you thus far, but they're not any heavier than raising your biological children. 

For example, the average cost of raising a child from birth until 18 in America is nearly a quarter of a million dollars. Sure, tax credits and other benefits also help parents, but foster care systems offer numerous routes for covering extra care costs and providing support.

Now Relax

Now that we've laid all the cards on the table, you may be slightly overwhelmed. This isn't an effort to talk anyone out of foster care - quite the opposite. It is of the utmost importance that foster parents understand every aspect of the foster care system and the potential financial implications it may have on their families. 

Many of the numbers and ramifications above are overwhelming enough to make your head spin. The good news is that Virginia has your back regarding maintenance payments, reimbursements, and other allowances for foster parents.

The cost of raising a child in a happy and healthy home is never cheap. The difference in being a foster parent is that organizations like fosterva.org help you navigate the financial obstacles and provide the educational and nurturing support that many new parents lack.

This guide has been designed to thoroughly prepare you (not scare you) for the beautiful journey you are considering.

Call Today to Talk About Being a Foster Parent

There is much to talk about regarding the financial impact of being a foster parent in Virginia. As with most government programs, there are several requirements, but significant benefits are associated with completing them. 

If you've made it this far in this article, you are interested in becoming a foster parent. Many of these requirements can seem overwhelming - even mind-numbing - at first. Still, the professionals at Fosterva.org are passionate, dedicated, and more than ready to help you begin your journey as a foster parent. Please, reach out to us!