As most parents already know, having kids is basically the equivalent of lighting money on fire. And parents of babies who say you’ll save money once they are done with diapers? Hahahaha. Nope. The older they get, the more expensive they get. School supplies. Sports. Camps. Food. The baby days are a breeze compared to financing teenagers.
Just to drive in the knife, the U.S. Department of Agriculture has released a new report citing that the average cost to raise a child born in 2015 from infancy to age 17 is currently … drumroll please … $233,610.
If that number staggers you, try this on for size: It doesn’t even factor in college tuition or costs related to pregnancy, adoption, or childbirth. And we all know that by the time that baby even enters the world, you’re already in the hole. So add on the mountain of money required for college ($20,000 — $45,000 annually), and well … best get planting that money tree in the backyard!
The USDA explains that this is an average cost analysis for middle-income families with married parents. The number is higher in more expensive parts of the country, such as the urban Northeast, and lower in areas such as the rural Midwest. Also, families with lower incomes will spend substantially less (averaging $174,690) and those with higher incomes will average $372,210.
According to the USDA’s report, housing and food make up the greatest portion of a families budget (consisting of 29% and 18% respectively), followed by childcare, education, transportation, and healthcare. Clothing made up the smallest portion of the budget.
According to Louisa Quittman, Director of the Office of Financial Security for the U.S. Department of the Treasury, MyMoney.gov can help a family develop a budget that works for them and also save for emergencies or big purchases like a home or college tuition.
“MyMoney.gov can also help you provide money management lessons for your children to help them be more prepared for their financial future,” Quittman shared.
ChooseMyPlate.gov/budget helps families shop and cook smart by providing sample menus, tips for understanding prices, and guides for reading food labels.
But if you’ve read this far and still haven’t really absorbed anything after $233,610, there still a few more tidbits of good news in the report: Although housing costs have continued to increase in recent years, food costs have decreased due to changes in American agriculture. Also, despite kids being more expensive as they get older, this report asserts that sharing resources means families with more kids actually spend less per kid. Kids with multiple siblings may share a room, toys, clothing, and food is often purchased in bulk quantity, all of which save on costs.
If this number still doesn’t sound right to you, check out this handy calculator tool, which lets you input your personal information and determine the potential cost of raising your own children. I have three kids myself, and after inputting their ages and the area of the country where we live, I ended up with an estimated cost of $42,000 annually to raise my kids.
So if you’ll excuse me, I’ll be off snipping some coupons and setting up for a garage sale …More On