Raising kids is expensive: Here's how you can plan

The U.S. Department of Agriculture recently released the 2015 Expenditures on Children by Families report, also known as, “The Cost of Raising a Child.”

Let’s face it. How many parents really need a study to tell them it’s expensive?  All they have to do is see how little money they have left at the end of the month.

Still, the report first issued in 1960 as a way to determine child support and foster care guidelines, can be a valuable resource for parents trying to estimate how much they’ll need to support their families. It can be especially helpful when determining if both parents need to continue working or if one can afford, what has become a luxury in America, to become a full time caregiver. 

The study was developed by economists at USDA’s Center for Nutrition Policy and Promotion, and estimates that for a child born in 2015, a middle-income married-couple family will spend between $12,350 and $13,900 annually (in 2015 dollars), or $233,610 from birth through age 17 on child-rearing expenses.

That cost is even higher for families living in urban coastal regions and the South. Parents in Pennsylvania and New Jersey can expect to pay $253,770 or $20,000 more on average.   

And of course, that amount really doesn’t tell the whole story.

What is does include are the necessary major expenses with housing and food having the biggest impact on spending and clothing the least: 

Housing                                  29%
Food                                        18%
Child care/education           16%
Transportation                      15%
Health care                             9%
Miscellaneous                        7%
Clothing                                  6%

The report does not include costs related to pregnancy or college, nor take into account that more and more young adults continue living with their parents well after graduating from high school and college.

It is important to note that child-rearing costs vary greatly depending on the number and ages of children in a household. As family size increases, costs per child generally decrease. Report author and CNPP economist Mark Lino, PhD emphasized how significantly costs are impacted by the number of children in a household.

“There are significant economies of scale, with regards to children, sometimes referred to as the ‘cheaper by the dozen effect.’ As families increase in size, children may share a bedroom, clothing and toys can be reused, and food can be purchased in larger, more economical packages.” Lino said.

As a result, compared to a child in a two-child family, families with one child spend 27 percent more on the only child and families with three or more children spend 24 percent less on each child. 

“Understanding the costs of raising children and planning for anticipated and unexpected life events is an important part of securing financial health”, said Louisa Quittman, Director of the Office of Financial Security for the U.S. Department of the Treasury.

Good advice!

To help parents manage, the government has a wealth of online information and tools including:

Cost of Raising a Child Calculator which will provide a detailed personalized report for your family.

MyMoney.gov which assists in budget planning, determining child care costs, and saving for emergencies or big purchases like a home or college education. It even has money management lessons for your children to help them be more prepared for their financial future.

ChooseMyPlate.gov/budget which can help reduce food expenses.

Having children is expensive, but I can’t think of a better investment for our future and the future of our county.


Have a question for the Healthy Kids panel? Ask it here. Read more from the Healthy Kids blog »