What Are the Highest Costs of Raising a Child? Suffice it to say that costs will likely increase over time - and if history is any guide, we can expect long-term inflation of around 3.8% per year. Nobody knows what future inflation rates will be.The cost of raising children varies from year to year.There are two problems with this approach, however: Theoretically, this figure will rise by around 3.8% per year - meaning the cost will be $16,613 in Year 2, $17,244 in Year 3, and so on. We estimate an annual expense of $16,005, based on 2022 figures. To conceptualize this, it’s helpful to look at the yearly cost. This means that the cost to raise a child should increase at a rate of approximately 3.8% each year. Looking at long-term average inflation rates from 1960 through 2021, we can see that costs rise around 3.8% per year, on average. The latest official figure we have is for a child born in 2015, and the estimated cost is $233,610 total.įor 2022, the inflation-adjusted estimated cost is around $288,094 total, or approximately $16,005 per year.īut what about the future? It’s difficult to predict how fast the cost of living will rise, but increasing costs are almost inevitable due to inflation. It’s also important to keep in mind that overall costs will likely continue increasing over time as a result of inflation, eating away at buying power. Some years may be quite high, while others may be much lower. Of course, costs will vary significantly from year to year. While that’s still a hefty figure, it seems far more attainable than $288,094! Taking a rough average, that’s around $16,005 per year - or approximately $1,334 per month. The $288,094 figure can seem incredibly intimidating - but remember, that cost is spread out over 18 years. How much does raising a child cost yearly? ![]() Just as households spend drastically different amounts on entertainment, dining out, etc., spending on children varies substantially. public school, can greatly impact total costs. Lifestyle choices: Lifestyle choices, like the decision to send children to private school vs. For this reason, raising two children doesn’t necessarily cost twice as much as raising one child. But that single-family home could likely accommodate two children for the same cost. For example, having one child may require a family to move from a less expensive apartment to a more expensive single-family home. Number of children: Some costs, like housing, don’t necessarily increase in a linear fashion with additional children. 2022 data shows that 51% of parents spend more than 20% of their household income on childcare alone. For instance, a family with a stay-at-home parent might spend next to nothing on childcare, while a household with both parents working (and no nearby family) might spend a huge amount on childcare. However, this figure can vary significantly depending on the situation. Childcare: Childcare and education costs can account for up to 16% of total costs, according to USDA data. The USDA data accounts for the national average, but figures can vary significantly based on area. Geographical location: It costs much more to raise a child in New York City than it does in rural Minnesota. Here are some of the key factors that affect this cost: It should be taken with a grain of salt, as many factors influence how much it costs to raise children. This figure will continue to increase every year due to rising costs. The average cost of raising a childĪs of 2022, raising a child from birth to age 18 costs roughly $288,094. If we take the $233,610 figure and adjust it for inflation, then the current average cost of raising a child is $288,094. This means that the estimated cost of raising a child is likely 23.3% higher today than it was back in 2015. Since 2015, costs have risen 23.3% on average due to the effects of inflation. We can find the estimated cost for a child born today by calculating the inflation-adjusted figure. Inflation means that a dollar 10 years ago could buy more goods and services than it can today. It is important to keep in mind that this USDA data was gathered for children born in the year 2015, as this is the most recent government data available related to the cost of raising kids.ĭue to rising costs and inflation, this number is no longer accurate. It does not, however, include the cost of attending college. This figure includes the costs of food, housing, clothing, school supplies, healthcare, and more.
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