helping your children financiallyKids these days! They can be so expensive!

Raising a child gets more expensive every year.

Not only does inflation take its toll, but there always seems to be another activity to do.

The older your children get, the more they are likely to cost (well, once you get them out of the initial “baby” stage where diapers can be a killer cost).

The USDA says that children are getting more expensive as well. I recently plugged my information into the Cost of Raising a Child Calculator offered by the USDA, and found that my 10-year-old son is expected to cost me $28,350 just this year.

We’re not on track to actually hit that mark so far this year, but the results have me thinking. I’m sure there are those in other places who spend that much on their kids — or spend even more — each year.

What Do You Provide for Your Children?

I only have one child, and apparently that makes a difference. After playing around a little bit, I discovered that the average yearly cost for each child goes down when you have more kids. Probably because multiple children share the resources that you provide for them.

So, what are some of the amenities you provide to your children? Here are broad categories the USDA includes in the calculation:

  • Housing
  • Food
  • Transportation
  • Clothing
  • Healthcare
  • Childcare and education
  • Other

On top of that, the USDA calculator takes into account where you live (regional) and how much money you make. At first, I thought it odd that how much money you make matters.

However, when I thought about it, I realized that many of those with higher incomes feel pressure to spend their money a certain way by doing things like sending their kids to private school, providing some sort of private lessons, and by buying more expensive clothes. Just where you live and the car you drive as a person with a higher income can influence the average cost of the activities your child is involved with.

The following infographic from Quizzle puts some of the data into perspective as well:

The Cost of Raising Kids (Infographic) - An Infographic from Quizzle Wire

Embedded from Quizzle Wire

For most families, the cost is going to be somewhere closer to $13,000 a year.

How Can You Reduce the Costs of Raising a Child?

Of course, the calculator just offers an average. Many people get away with spending a lot less on their children each year. I’ve performed the calculation on my son, and I’m below average in all the categories.

My total for my son is on track to be about $17,000 this year — lower than the more than $28,000 the government thinks I will spend.

A lot of the price reduction comes from figuring out ways to reduce the costs associated with raising a child, and not falling prey to the “expectations” of your income group.

Some of the costs, like being careful with what you spend on clothing, and taking the time to shop carefully, using coupons and sales, for groceries, can be cut just by being savvy.

Additionally, if you are a family that is more interested in financial freedom than keeping up with the Joneses, you can reduce all of your costs (including those that deal with raising kids) with a modest home and modest cars. If you have a partner, and can swing the one-income thing, you save on childcare costs just by having one parent stay at home.

Finally, limiting your children’s activities can save you a great deal of money. After all, do you really need to pay for your kids to do four or five extracurricular activities? You run the risk of burning them out. Instead, consider limiting them to two activities. You’ll save money, and your kids won’t run the risk of becoming too stressed.

What do you think? Does it cost so much to raise a child? How do you save money?


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Comments | 2 Responses

  1. says

    As someone who has 5 (soon to be 6 kids) I have a huge issue with these numbers. Yes, we live in an area where the standard of living is very low, but it’s not like you take the cost for one kid and multiply it by the number of kids. Kids share things. If a kid shares a bedroom with a sibling, can you really count the housing cost a full 2 times? Also, kids need more as they get older (clothes, books, etc) , but then there is more resource in the house to share. So hand-me downs help in this instance. The cost to raise my only daughter is high. The cost to raise the 4 boys will decrease with each one, as they share property, clothes, even toys. My kids have everything they need (and more), but these numbers assume you buy new for every kid… every time — and never retain assets.

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