You may feel like winning the lottery upon seeing your child after birth, but the cost of raising a child to adulthood can also cost a fortune. Although this can be easily calculated, the results may not be that accurate because of some uncontrollable factors such as economic changes and unforeseen circumstances during the child’s life.
Despite the inaccuracies, it will still be wise to know how much does it cost to raise a child if you decide to start your own family.
Costs to Raise a Child
The average cost of raising a child from birth to 17 years old in the US ranges from $13,000 to $20,000 every year.
According to the US Department of Agriculture (USDA), the total cost amounted to $233,610 in 2015. Adjusting for the inflation rate, the current cost will be equivalent to $284,570.
This amount is broken down into the major components of childcare:
- Housing – 29% ($82,525.30)
- Food – 18% ($51,222.60)
- Childcare and Education – 16% ($45,531.20)
- Transportation – 15% ($42,685.50)
- Healthcare – 9% ($25,611.30)
- Miscellaneous – 7% ($19,919.90)
- Clothing – 6% ($17,074.20)
Factors Affecting the Cost of Raising Children
Raising a child is a happy responsibility for parents, but definitely not a walk in the park. As you can see above, it can be as complex as it is very expensive. However, there’s no one size fits all when it comes to this kind of cost, as some parents can have a much lower parental expenditure than others.
Having said that, there’s a lot to consider before you decide to be a parent and plan how much to spend on raising your kids. They are as follows:
The cheapest regions in the US to raise a childwould be in rural areas. This is because people in the countryside either have a simpler lifestyle or are able to manage their money well since they plant and grow their own food.
The most expensive would be in the urban northeast region, where New York belongs. Take a look at how much raising a child costs in these particular regions:
- Rural – The areas included in this region are municipalities or towns that have a population of less than 2,500 people. The total cost is $193,020, or an average of only $11,355 per year.
- Urban South – The states of Alabama, Arkansas, Delaware, District of Columbia, Florida, Georgia, Kentucky, Louisiana, Maryland, Mississippi, North Carolina, Oklahoma, South Carolina, Tennessee, Texas, Virginia, and West Virginia belong here. The total cost is $232,050, or an annual average cost of childcare of $13,650.
- Urban Midwest – States belonging here should expect to spend an average of $13,376 annually, or a total of $227,400. Illinois, Indiana, Iowa, Kansas, Michigan, Minnesota, Missouri, Nebraska, North Dakota, Ohio, South Dakota, and Wisconsin belong in this region.
- Urban West – If you happen to live in either Alaska, Arizona, California, Colorado, Hawaii, Idaho, Montana, Nevada, New Mexico, Oregon, Utah, Washington, or Wyoming, the average yearly cost of raising a kid is $14,439, or a total of $245,460.
- Urban Northeast – This is probably where the majority of the richest Americans live. The states that belong here are Connecticut, Maine, Massachusetts, New Hampshire, New Jersey, New York, Pennsylvania, Rhode Island, and Vermont. The average cost of child-rearing in either of these states is around $15,535 per year, or a total of $264,090.
2. Income and Lifestyle
Apparently, the annual income of the parent or parents can significantly affect child-rearing costs. If the parents have an annual income of less than $61,530, then they need to set aside 25% of it for their child, which can be anywhere between $9,130 and $10,400.
If the yearly income is within the range of $61,530 to $106,540, then 16%, or $12,800 to $14,970, should be used for the child’s necessities. If it is more than $106,540, then 12% of the income, or $21,330 to $25,700, would suffice to raise the child.
As your child grows up, his or her needs and expenses tend to increase as well. The primary factors that contribute to the increase are the child’s education and food.
From birth to two years old, the average cost is around $12,000 to $14,000 per year. From three to five, the expenses are relatively the same as the first two years. Between six and seven years old, the annual expenditure goes down to $12,800 per year.
From nine to eleven years old, the child’s body changes in preparation for puberty; hence, the needs change as well. With that said, the yearly cost for these ages is $13,680 per year.
Then, it continues to rise as they age, from 12 to 15 years old, costing around $14,420 per year. At 15 to 17 years old, the average cost has already reached $14,970 per year.
4. Number of children
Aside from the child’s growing years, the childcare costs also rise if you have one or two more children. If you only have one child, then you need to have around $17,038 every year to raise your son or daughter until he or she is old enough to live independently.
If you have two children, then the annual cost of raising both children is $28,600. If you plan on adding one more child to your family, then make sure you have $33,346 per year to provide them with their needs.
You should take note that the cost increases as the number of children increases. However, the cost per head decreases due to the fact that some expenses that were supposed to be for one child alone may be shared by two or more kids. Some examples include rooms, toys, and clothes (hand me downs), among others.
5. Whether you have a partner or you’re a single parent
It would also be more difficult if you raised your child or children on your own. Beside taking care of your children’s needs, you also have to provide for yourself. Hence, the total amount of expenses you need to cover is $172,200.
However, if two parents are raising a child, then the overall cost of parenthood is around $174,690. Note that these figures are for low-income households only.
On the other hand, high-income solo parents consume around $319,020 on their children, and around $372,210 is spent by married couples.
6. Presence of Grandparents
Some may underestimate the importance of having your own parents or the grandparents of the kids around. However, if you come to think of it, how much of the cost of raising a kid have you saved just because your parents were willing to babysit your child?
The monthly cost of preschool daycare ranges from $370 to $1,100 but could even be as much as $2,000 depending on where you live.
In the best case, you may even be able to cross out the entire childcare or daycare cost with the presence of grandparents around. That’s if they are willing to do the service for free.
Before you even begin to think about the cost of fulfilling a lifelong dream of becoming a parent, you must remember that not everyone may be lucky enough to biologically have a child. But if you are, then expect to spend around $11,200 for normal delivery and around $15,000 via Cesarean section.
Those amounts do not even include the cost of check-ups, procedures, and workups, as well as vitamins, supplements, and medicines during the entire term of pregnancy.
However, there are some options you can consider when everything doesn’t go as planned:
- Fertility treatments: some parents find it hard to conceive a child and will resort to fertility treatments and counselling. A session of in vitro fertilization typically costs $15,000. However, it is possible to require several rounds to successfully conceive.
- Adoption: couples who have tried everything to have a child but failed, or even single Americans who don’t want to get married but want to raise a child, often opt to adopt instead. If you decide to adopt within the US, expect to spend between $15,000 and $40,000. However, adopting from abroad can cost around $50,000 or possibly even more.
As you can see, raising children is not all about the good stuff, especially when you are a single provider. But when you see them grow up and turn into the person you wish them to be, then, every single dollar you have spent is going to be worth it.