The Cost of Cute: A new report highlights that raising a child now costs almost a quarter of a million dollars.

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I once heard a comedian joke that babies and children are made so cute just so parents can cope with the fact that they’re so much work and difficult to raise. That may be true, and we can add the fact that children are pretty expensive to that list.

The United States Department of Agriculture (USDA) recently released their annual Expenditures on Children by Families report, highlighting the accumulated cost of raising a child. The USDA tallied the line items or many different expenses, such as housing, transportation, child care, health care, food, and clothing, etc. for raising a child from 0-18 years old, but not beyond. The result?

A middle-income family now can expect to pay about $245,340 to raise a child. Of course that number fluctuates depending on the family’s income, the region in the country where they live, if they live in a city (more expensive) or the suburbs or country, and if their child gets a public or private school education.

But the reality is that on average, it costs almost a quarter of a million dollars to raise a child in America – without even factoring in college or continued financial support past 18 years of age. For families that have four children, that means they very well could be allocating a million dollars or more to get them to adulthood.

To put those numbers in perspective, the USDA-reported price tag is about a whole 2% just from the year before, a $4,260 increase. The biggest expenditure increases in recent years have been in the areas of transportation and food (a 13% increase since 2008). Child care in particular was the biggest expense for many families, as in 2012, care for just one infant cost more than the median rent in nearly half the states in the U.S.

The good news is that inflation has kept overall costs level over the last few years, and low gas prices should help drop transportation costs. But even though we’ve safely climbed out of the recession, median incomes are still 8% below what they were before the economic downturn of 2008-2012.

The USDA also reports a wide variance in child raising costs depending on where you live. For instance, in the urban South it only costs an average of $230,610 and in rural regions of the country the average is even lower ($193,590). Low-income rural families spend the least, at only $145,500 per child.

It’s most expensive to raise children in the urban Northeast ($282,480). The report also illuminates a huge income gap, particularly in the northeast where high-income families are expected to spend about $455,000 to raise a child to the age of 18, nearly double that of low-income families in the same region.

Conspicuously absent from these numbers is the cost of putting a child through college. In fact, the average cost of public college is now $18,390 per year and private institutions cost a whopping $40,920 per year. Of course a lot of students take out student loans to cover the cost of a higher education, but most parents still contribute. Young adult children are also living at home longer and requiring some economic assistance far past 18, usually until they enter the workforce in earnest.

Here is a breakdown of the average costs of raising a child:
Housing and transportation:  $107,970
Child care and education:  $44,400
Food:  $39,060
Clothing and Miscellaneous: $33,780
Health care: $20,130

How expensive are children per age?
0-2 years old   $12,940 per year
6-8 years old   $12,800 per year
15-17 years old  $14,970 per year

What expenses take up the highest percentage of the yearly budget?
Housing 30%
Food 16%
Transportation 14%
Clothing 6%
Health Care 8%
Child care and education 18%
Misc. 8%

So how much do you think you’ll spend on your children? What are your biggest expenses with raising children? What are some ways you try to save?


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