Kids 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 $20,660 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 have two children still at home, 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.
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 some of the categories and above on others.
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?
