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Cost to raise a child: As much as $399,780

Depending your income level, you'll spend anywhere from $173,490 to nearly $400k from infancy to age 18, a report says.

By Donna_Freedman Aug 14, 2013 2:30PM
Logo: Baby with money (Creatas, Photolibrary)
A middle-income family will spend $241,080 to raise a baby born in 2012 until the age of 18, according to a report released today by the U.S. Department of Agriculture.

That's an increase of $6,180 over the previous year, according to the annual "Expenditures on Children by Families" study. But it's a little lower than usual, just 2.6% vs. the normal average increase of 4.4% from year to year. This is likely due to the fact that housing costs did not increase significantly in 2012.

The study defines "middle income" as between $60,640 and $105,000, pretax. Kids got more expensive for the other two income groups as well.

Households earning less than $60,640 will spend $173,490 (an increase of $4,410). Those who bring home more than $105,000 will ante up a whopping $399,780 (a jump of $10,110).

Do kids really cost this much? And is there any way around it?

The answers are "maybe" and "definitely" -- but compromise is just as important as common sense.

Common sense would dictate that moving to an expensive area means a higher cost of raising a family. Job searches could thus be focused on the more affordable regions of the country.

Overall expenses are highest for those in the urban Northeast, urban West and urban Midwest, according to the study. Those living in rural areas or the urban South spent the least.

Yet compromise is necessary for those whose jobs and/or family ties already have them anchored down in an expensive region. Do you move to a cheaper state and save money immediately, or do you stay where you already have work and a support system and focus on saving money in other ways?

The pressure to overspend

It's tempting to dismiss such large dollar amounts as the result of people spending frivolously on their kids. But the two largest expenses are housing and education/child care (as much as 33% and 23%, respectively) and the third-highest expense, food, takes up to 18% of the total budget. None of these three categories is discretionary.

It's easy to spend a bundle on your bundle of joy even if you don't go in for high-end clothing or pricey preschools. Parents overextend themselves buying homes near good schools and by paying for lessons, sports fees and other activities they believe will benefit their kids (especially during the college search).

"Competitive educational environments and an awareness of what it takes for children to succeed are prompting more spending," notes an article in Bloomberg Businessweek.

"It's not just the cost, it's the pressure," Ellen Galinsky of the Families and Work Institute told Bloomberg. Families don't get the support they need to help them "navigate" the process of bringing up children, she said.
That process has changed considerably since the first study, in 1960. Housing was also the largest single expense back then, but health care was only 4% of the total budget (now it's as much as 8%) and education/child care just 2%.

Food costs have actually gone down since 1960, when it was the second-biggest component. The difference is likely due to changes in agriculture, according to the USDA.

Interestingly, clothing and miscellaneous expenses also decreased by a few percentage points despite today's emphasis on designer labels. The drop in clothing costs is likely due to "technological changes and globalization (having) made clothing less expensive," study authors say. Miscellaneous spending probably decreased due to the growth in other categories, "which are often seen as discretionary."

Understanding the true costs

Having trouble wrapping your mind around those dollar amounts? Check out this interactive visualization tool produced by the USDA and FutureAdvisor, an online investment adviser company.

You can search costs by region and look at expenses by birth year. For example, the total amount to raise my older nephew, born in 2001, is projected to be $242,736. His younger brother, who came along five years later, will cost $245,733 -- an increase of about $3,000.

Seeing that kind of trend could help parents decide when (or whether) to have another child. Those who are considering kids "someday" might decide to start a little sooner -- or to wait until they're on a more solid financial footing.

They can also make carefully considered choices. For example, do you really need a four-bedroom home and a monster minivan if you're planning just one or two kids? Having one parent home with the kid(s) will nix the second-biggest expense, although you must factor in both the loss of income and the impact on retirement.

You can also trim expenses via tried-and-true frugal hacks such as cooperative or multigenerational housing, thrift stores, gardening, couponing, home cooking, bulk buying, keeping automobiles longer and being a late adopter of technology.

But unless you're living in a paid-off home in a rural area or the urban South, there's only so much you can do to reduce costs. Keep long-term expenses in mind when considering the size of your future family, advises Bo Lu of FutureAdvisor.

"Couples know children can be expensive, but they often don't understand the true cost," he says. "Children are expensive, and families should plan for that."

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Aug 14, 2013 3:55PM
They forgot to mention the ones on welfare that we have to pay for too.
Aug 14, 2013 5:41PM

So basically $1000 a month.


These figures must have been generated by the same idiot used to determine child support after a divorce.


You know, the amount which causes the payer to have to live out of a shopping cart and eat dog food!

Aug 14, 2013 9:49PM
I don't have any kids but I get to pay for those who can't to do anything but reproduce.
(And it's nice to know that they feel that they are entitled to this.)

Aug 14, 2013 7:09PM
Stupid article, as if I wouldn't have to pay for housing if I didn't have a child.

Aug 14, 2013 5:44PM
The sad part is how much those that don't have children will spend to support others that do but will not support them.
Aug 14, 2013 3:48PM
And this is newsworthy...I think those of us who are parents realize kids cost money.  It's another mouth to feed, body to cloth and mind to teach.  All of this costs money if you want that person to grow up to be a productive well balanced adult.
Aug 14, 2013 8:12PM
The trend of giving every kid a trophy has not helped them at all. It has hurt them more than anything.
Aug 14, 2013 6:45PM
How much does it cost that same Middle Class Family to pay for and raise all of Obama Sons and his hordes of professional Welfare supporters??
Aug 15, 2013 9:11AM
Why the shortened age span? What about the other 12 years after 18? "Kids" are still at home and/or living off mom and dad at age 30. Every parent I currently know with grown kids right now is still supporting them in some substantial fashion.
Aug 17, 2013 5:48PM

And who's report is it?  Some left-wing, northeast idioat liberal that has no common sense!


It only cost alot if the parents are fools who pamper their kids plus have no financial management skills.  If you have kids, it also requires common sense -- something half our population does not have. 


By the way, it will cost me about $32,000 to raise my kids. 

Aug 19, 2013 7:59AM

I don't know where these numbers are generated, UNLESS it's based on what welfare programs put out for those too lazy to work.


I have two sons with families, one has 4 children - 1 in college, the other 6 children.  Neither of them earns a salary (both wives choose to work) large enough to accommodate the numbers provided in this article.


The only thing I can think of that would generate this information is that the figures used are based on the most expensive housing, clothing, schools, etc..  The middle income folks I know who are raising children purchase clothes at garage sales (in neighborhoods where they spend the highest $$) and store clearance sales.  They buy 'pre-owned' automobiles and drive them forever doing as much of the maintenance as they can themselves.  Families in our social circle live in nice homes, some own some rent.


Remember, folks, figures may not lie, but LIARS DO FIGURE.  The purpose of the article is beyond me as I don't find much realism in it. 

Aug 14, 2013 5:47PM
Obamaville needs breeders to breed to create future taxpayers to pay the debts - get back in there and do it again
Aug 14, 2013 7:10PM
I am a single parent and find that the most expensive cost from my daughter at the moment is clothes and shoes. She seems to be growing by the minute. Diapers are also costly. She is 19 months old and isn't showing any interest in Toilet training.
Aug 19, 2013 8:57AM
Yeah, the costs of raising a kid are going up, because once you have them, you can't get them to leave!
Aug 19, 2013 1:39PM

Any male and female can make a third person....usually. Doesn't mean they can support them. I like the old days...can't afford em from the start...LOSE them. If you start a family jobless, this is the most selfish thing you can do, it means that not only will the system be supporting your new person on the planet, but most likely the parents, who use their offspring as a meal ticket.

Aug 19, 2013 10:39AM
The higher it gets the more the taxpayers have to give to the unwed mothers who don't work.  All the more reason deadbeat dads should pay up or be neutered.
Aug 19, 2013 10:05AM
This story goes well with the one last week where the two parents were saying they don't have jobs and with there third kid on the way government welfare and food stamps just don't cut it,they were overweight with tattoos and multiple piercings! 
Aug 19, 2013 9:20AM
send me the money an i'll cut my nuts
Aug 19, 2013 3:52PM
Figuring till age 18...that would be $2,222.22 a month for 18 years, seems a little high to me.
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