What are the Financial Considerations for Foster Parents?
The number of children in foster care is counted every year on September 30th, the end of the fiscal year. According to USA facts, there were 407,493 children in foster care in the US at the end of 2020.
The Virginia Department of Social Services reports that as of August 2022, there are 5041 children in the foster care system. While several factors may lead to a child or teen entering the foster care system, abuse and neglect are the most common reasons. Overall, however, one must consider that these children usually enter the system through no fault of their own.
When contemplating the possibility of fostering, it is expected and welcomed for prospective foster parents to have many questions and concerns about an advantageous but rewarding step in their lives. One of the many questions we here are what are the financial considerations for foster parents I should consider at this stage? A financial plan is essential for you and your family, if this is adopting a child in time or starting with respite care.
The first step is educating you about the fact that foster care is a temporary arrangement for children and teens when their parents or primary caregivers are going through a crisis. When youth cannot remain safely in their homes and must enter foster care, the first goal is to reunite them with their families as soon as possible safely.
If you consider the possibility of becoming a licensed foster parent, read on to learn some potential financial responsibilities and obligations to consider. We have Foster Parent Advocates, Family Services, and Clinical and Home Study Specialists available to assist you with navigating all aspects of the fostering journey.
Essential Maintenance Payments
You will receive a monthly maintenance payment for caring for your foster child(ren). This money is intended to use toward the basic costs of child care. Essential maintenance payments per month vary depending on the foster child's age.
You should be able to pay your monthly bills with your income and use this as extra income invested into your foster child(ren). A typical range of payments includes the following:
● Ages 0-4 receive $471 per month
● Ages 5-12 receive $552 per month
● Ages 13 and up welcome $700 per month
There are certain situations where you may receive more than the basic maintenance payments mentioned above. This includes problems where children need extra care. If you feel your foster child needs additional care, you are not being compensated for it. You can request an evaluation by the Treatment Foster Care agency (Child Placing Agency - CPA).
Documentation of any extra care required to support a child helps in receiving these additional funds when you need them. While a child is in your care, good documentation is critical. The caseworker should be able to assist with training and support while a child is in your foster home. Enhanced maintenance payments are made on child-by-child bases, and support is designed to support the child's welfare.
Foster children receive a monthly clothing allowance. However, if the foster parents have funds to provide clothing that is highly encouraged, some local Department of Social Services (DSS) or Licensed Child Placing Agencies (LCPA) give these funds at certain times of the year. Therefore, it is essential to know when these disbursements are made and plan accordingly concerning seasonal shopping.
Foster children qualify for Medicaid and will be covered for all medical expenses. The foster families' financial status is not a consideration for them to qualify.
Prescription and OTC Medications
Medicaid covers prescription drugs, while over-the-counter medications are usually considered an out-of-pocket expense.
There is a transportation reimbursement available for Medicaid clients. Mileage used to get a client to an appointment is reimbursable. Transportation services are provided for clients as well. Registrations for these services can be made through Logisticare.
Respite care is offered to foster parents to account for different circumstances. In these cases, another licensed care provider is approved to take temporary care of your foster child(ren). There are times when foster parents may have an emergency and may have to leave town for a few days or need a break due to tension. Whatever the situation, when approved, the temporary care provider assists with maintaining the relationship between the foster parents and foster child(ren) by having a healthy break from each other.
Women, Infants, and Children (WIC) Program
WIC is a nutritional program that women, infants, and children can participate in. Foster care children between zero to five can be eligible for the WIC program.
Free School Breakfast and Lunch
Since your foster care child(ren) will be enrolled in public school, they will be eligible to receive free school lunches and breakfast. Free school breakfast and lunch help eliminate the added expense of providing these meals for the school day.
Another cost that prospective foster parents should consider is the cost of daycare if the foster parents are employed full-time. While not directly said in the benefits for foster parents, the monthly maintenance payments may be used toward supplementing daycare for foster children. When the child may be too young to stay at home after school, the local DSS may assist in covering these costs for some foster families.
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. The maximum tax credit for foster parents is $4,000. The tax credit is in addition to the federal child tax credit. Please check with your tax advisor, as rules constantly change because we are not tax experts.
Property Damage Funds
Contingency funds are disbursed to foster families by the Virginia Department of Social Services. They have funds specifically to give foster parents in case any significant damage happens to the home by foster children. Foster children have been through a lot in their lives, sometimes resulting in behavioral problems.
After having been through abusive situations, these children tend to act out without solid support systems in their lives. This is why fostering is so rewarding; you get to play a positive role in children's lives who need it.
However, it's essential to do this responsibly, hence the Virginia Department of Social Services' recognition that damage may happen to you that you aren't responsible for. Remember that an extensive process takes place to receive these funds, as you must be approved and validated for your situation.
After taking in all of this information, you may ask yourself, why should I even consider taking on this huge responsibility? There is honestly no easy answer to that question. However, some considerations can assist you in getting to a solution.
Whether you've never had children, you're an empty nester, you just can't get enough kids, or you may feel like you're not done parenting yet. Fostering a child allows you to expand your parenting skill set and grow in unexpected ways.
This is an excellent opportunity for those who feel it is their destiny to be a parent and haven't yet fulfilled that destiny to their satisfaction. No matter what stage of life you're in, if you have the resources, patience, and love to foster a child in need, you can learn more about parenting — and yourself — through foster care than in more ways than you can imagine.
We hope you decide to become a foster parent is an excellent thing for you and your family. We stand ready to assist you at every step of the way! At FosterVA, we are here to give you additional support as you need them.