McCormick Institute for Early Childhood

BY Robyn Kelton | January 27, 2020

A woman wearing glasses and a suit is smiling in front of a flag.

Sim Loh is a family partnership coordinator at Children’s Village, a nationally-accredited Keystone 4 STARS early learning and school-age enrichment program in Philadelphia, Pennsylvania, serving about 350 children. She supports children and families, including non-English speaking families of immigrant status, by ensuring equitable access to education, health, employment, and legal information and resources on a day-to-day basis. She is a member of the Children First Racial Equity Early Childhood Education Provider Council, a community member representative of Philadelphia School District Multilingual Advisory Council, and a board member of Historic Philadelphia.


Sim explains, “I ensure families know their rights and educate them on ways to speak up for themselves and request for interpretation/translation services. I share families’ stories and experiences with legislators and decision-makers so that their needs are understood. Attending Leadership Connections will help me strengthen and grow my skills in all domains by interacting with and hearing from experienced leaders in different positions. With newly acquired skills, I seek to learn about the systems level while paying close attention to the accessibility and barriers of different systems and resources and their impacts on young children and their families.”

This document may be printed, photocopied, and disseminated freely with attribution. All content is the property of the McCormick Center for Early Childhood Leadership.

Warning: we are about to shine a spotlight on money, a topic that many of us do not like to think, much less talk about. But as a business owner, it’s imperative that you have a solid understanding of the financial health of your business. If you don’t, you run the risk of actually paying to run your business rather than making money on it.


The 2018 reliability and validity study of the Business Administration Scale for Family Child Care (BAS) found that 44% of family child care providers do not have a budget (Talan and Bloom, 2018). This number is shocking, and is also reflective of what I have seen in the field when conducting formal BAS assessments as well as when informally conversing with family child care providers. I think one of the reasons this number is so low is confusion related to terminology. What I often see is that providers mistake their actuals for their budget. Let’s take a moment to clarify the two terms:


Money Talk


The BAS defines a budget as is a projection, or a plan for the amount of money that will be made (revenue) by the child care business and the amount of money that will be spent (expenditures) to operate the child care business during the fiscal year (Talan and Bloom, 2018). It is important to note two key words: plan and projection. A budget is a document for the future, it captures what you plan to earn and what you plan to spend, it does not reflect the money you have actually spent or earned. It is also not an accurate reflection of the money in your bank account or pocket at any given time. Rather, it captures your financial goals and aspirations.


Actuals reflect how much money (income) has actually been received and how much money (expenses) has been paid out at a given point in time during a fiscal year (Talan and Bloom, 2018). Your actuals reflect how much money you actually earned and how much you actually spent, but they do not tell you how much you will earn next month or how much you will spend over the course of the year. These are sometimes referred to as “income and expense statements.” According to the BAS reliability study, 64% of providers keep track of income they receive and 60% keep track of business expenses (Talan and Bloom, 2018).


When I am talking with providers, they often say they have a budget. However, when I begin to ask more about it, or when we look at their documentation, what commonly happens is that we discover what they thought was a budget is really their actuals. They have records that have tracked their income and expenses so that they can see money coming in and going out, but they haven’t made the leap yet to crafting a budget which serves as a guide or plan for the future.


Making the Leap


So how does one make the leap to a budget? One option is to start by looking at the past. Closely tracking all your income and expenses for a month or more (ideally more) allows you to predict what your financial habits might look like in the future. The following steps can be used to develop a budget:


  1. Track all your income and expenses by collecting receipts and referring to paid bills.
  2. Categorize all business-related income and expenses by type (e.g., rent/mortgage, food, supplies, insurance, utilities, parent payment, Food Program reimbursement). I find it easiest to do this in an Excel document making each row a line-item and each column a month. There are also numerous resources available to help you create a budget ranging from computer software to books—find whatever way works best for you.
  3. Summarize the totals for each category so that you can clearly see how much you spent and earned in each area. Each category is called a line item.
  4. Use those totals to predict how much you will spend and earn in each of the twelve months of the year. At this point you should also take a moment to think about any other money that you might earn or spend related to your business that may not have been captured in the month(s) you tracked. Examples might include business liability insurance payments or tax payments, or extra money spent during holidays. Add any of these additional items into the totals or create new line items for anything that was missing. You should have an estimated total for each line-item or type of expense of income you have. Do this for each month in the upcoming year.
  5. After you have made your line-item estimates for each month, summarize the totals for the end of the year. This is your budget! It clearly communicates how much you plan to earn and how much you plan to spend for the year.
  6. One last thing: is your total projected revenue higher than your total projected expenditures? If so, this means you are planning to make a profit! If not, are there places you can make adjustments, like reducing your expenses or generating additional revenue? The beauty of having a budget is that you can plan in advance to make sure that you are operating your business in a way to make money.


Benefits of Both


The beneficial relationship between actuals and a budget is bi-directional, having one helps you navigate the other and vice versa. Having both is your first step to financial peace of mind. Tracking your actual income and expenses helps you keep tabs on your current fiscal status and helps you predict your budget for the future. Your budget then helps you plan long-term as well as make better spending decisions in the moment. Both documents are critical to sound financial health and having one without the other leaves you with only half the picture. You might be a family child care provider because you love children, but you need to make sure you are operating your business so you are not losing money by doing what you love!


Looking for more information on financial operations? Part 2: Tips for Tracking Actuals and Budgeting is forthcoming.

If you are interested in receiving training on the BAS, the McCormick Center for Early Childhood Leadership offers several opportunities including an upcoming BAS Reliability Training, March 24-27, 2020. More information is available here: https://mccormickcenter.nl.edu/events/business-administration-scale-bas-reliability-training-032419/.


Interested in learning more about financial operations for center-based child care administrators? Attend the PAS Reliability Training March 9-13, 2020 at the McCormick Center! More information is available here: https://mccormickcenter.nl.edu/event-type/reliability-training/.


References

Talan, T.T. & Bloom, P.J. (2018). Business Administration Scale for Family Child Care (2nd ed.). New York: NY: Teachers College Press.


Robyn Kelton, M.A., is a Quality Training Specialist for the McCormick Center for Early Childhood Leadership at National Louis University (NLU). Robyn conducts training and research on the Business Administration Scale for Family Child Care (BAS) and the Program Administration Scale (PAS) and serves as a national reliability anchor for both tools. In addition, Robyn reviews BAS and PAS assessments for the assessor certification system. Robyn holds a Bachelor of Arts degree in Psychology from the University of Kansas and a Master of Arts degree in Psychology with an advanced certificate of study in Organizational Psychology from NLU. Robyn is currently a doctoral student in the brain, behavior, and quantitative science psychology program at the University of Kansas. Prior to joining the McCormick Center, Robyn spent three years as a lead teacher in a kindergarten classroom for an after-school program. Robyn’s research interests include leadership in early care and education, family child care, child development, and autobiographical memory.

By Cara Murdoch February 16, 2026
In early childhood education and care (ECEC), we know that some of the simplest ideas can carry the biggest lessons—and many of us have been singing “The Ants Go Marching” for years without realizing it might also be a leadership guide. Ants may be tiny, but their colonies run on teamwork, communication, flexibility, and a clear sense of purpose—all things ECEC programs rely on every day. By taking a closer look at how ants work together to support their colony, early childhood leaders can discover practical and familiar ways to strengthen teamwork, value every role, and lead programs where everyone is marching in the same direction for children and families. Ants are busy creatures; they work with a purpose and know their jobs in the colony. Ants exhibit teamwork and collective effort. Ant colonies demonstrate intelligence, division of labor, communication systems, and cooperative behaviors. They can recognize and respond to the colony's needs. They overcome their challenges through trial and error, learning from their experiences, and sometimes even develop innovative strategies. In the ant colony, individual ants work together as a unit, each with a unique role that determines the colony's survival and success. The ant colony functions just like a superorganism, where the actions of each individual ant are a part of the highly efficient system that supports the whole colony. This concept of collective action is closely related to human teamwork! Ants have a lot to teach us, as we work in ECEC. teamwork Just as ants collaborate, relying on their communication and coordination to complete tasks, humans thrive when working together, as each individual brings their own unique skills and perspectives to their “colony.” Ants depend on each other. Each ant has a specialized job, and the colony relies on the cooperation and coordination of all its members to thrive and survive. Each ant’s contribution, no matter how small it may seem, is vital to the success of the colony as a whole, and the strength of the group is built on the cooperation of each individual. Similarly, in ECEC programs, teamwork — working together and helping one another —leads to better results than trying to do everything alone! When we collaborate, we pool our strengths, share our knowledge, and support each other, which can lead to more creative and efficient solutions. Each person in the program brings unique skills and perspectives, filling gaps and helping compensate for one another’s weaknesses. This shared effort allows your program to tackle tasks and achieve goals that would be difficult, if not impossible, for one individual to accomplish on their own... just like in an ant colony! Adapting to face challenges Ants are highly adaptable creatures. Have you ever watched a disrupted colony hurry to move the uncovered eggs to a protected space? They respond quickly to changes or disruptions in their environment. Their ability to quickly assess new situations and adjust their behavior will help the colony continue to function efficiently, even when the unexpected happens. Their adaptability is the key to their survival, allowing them to overcome obstacles and thrive. Early childhood programs also need to adapt to challenges. When unexpected changes occur, each person needs to be flexible and find new ways to contribute to the program's success. Just as ants adjust, programs must reassess their strengths, collaborate, and develop alternative solutions. Adaptability is essential for proper teamwork! honoring individual roles In an ant colony, different ants take on very specific roles. There are worker ants, soldier ants, and the queen ant. Each ant’s role is crucial to the success and survival of the colony, and all roles are interdependent; they work together to achieve common goals. This division of labor that exists in an ant colony can be compared to the different roles and unique talents found in an ECEC program. Just as ants rely on each other to perform specific tasks, each ECEC team member brings their own expertise and skills to the program. In a project or workplace setting, one person may excel at brainstorming creative ideas, another might be skilled at organizing tasks and managing timelines, and someone else may be particularly adept at technical skills or problem-solving. This diversity of roles within a team ensures that every aspect of a project or goal receives focused attention. In center-based programs, there are the director, teachers, kitchen staff, and other roles as needed. The diversity of roles in a program helps to ensure that the program is successful and thrives. clear purpose and goals In an ant colony, survival is the common goal. The colony’s success depends on each member performing its specific role. Their unwavering focus on the survival of the colony is connected to their success. It demonstrates the power of their collective action, driven by a clear and unified goal. ECEC programs thrive when they are aligned around a shared and clear purpose and goals. When program members understand and commit to their common goals, the well-being and growth of children and families, their efforts will become more effective and coordinated. Just as ants bring different strengths to the program, each person brings different strengths to the program. It is alignment around shared goals that enables the program to overcome challenges and succeed. When everyone in the program is clear on the goals and helps work together toward them, the whole program becomes more focused, resilient, and motivated - just as an ant colony becomes stronger when every member is working toward survival! Ants work together harmoniously to achieve their common goals; they set aside individual competition in favor of colony cooperation. Each ant focuses on its specialized task. This spirit of ant cooperation is key to the colony's survival and success, as it enables the colony to accomplish more complex tasks than any single ant could manage alone. ECEC programs can benefit from adopting a similar approach that emphasizes collaboration and shared goals over individual achievement. In an ECEC program, when members support each other and work together, they can leverage each person’s strengths to accomplish more than they could individually. Instead of competing for recognition or resources, each member can focus on the program’s success, fostering a more positive and productive environment. learning from ants Ants have so much to teach ECEC programs when it comes to cooperating and working together as an effective team. Whether it's knowing your own role and abilities, supporting each of your fellow team members, communicating clearly and effectively, being flexible, or avoiding competition, the ant colony is an excellent example of these qualities! Let your ants go marching!!! Ant Life, author unknown I am just an ant, A small life is what I live, But I have dreams for bigger things And so much more to give If only I could grow A foot or two would do I could live a life That others look up to.
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