How Much Does It Cost to Raise a Child?


The Cost of Raising a Child

How much does it cost to raise a child? What type of currency are we talking about here? Your sanity level or dollars? Just kidding!

In dollars, it’s a little less than a quarter of a million dollars to raise a child from birth until the time he or she turns 18 years old. A 2017 Department of Agriculture (USDA) study estimated your grand total at $233,610.

The USDA study factors in childcare and education expenses to arrive at their average, but this does not include college expenses. If you want to get a more precise estimate of what it might cost to raise a child for your particular family situation, you can check out the USDA’s Cost of Raising a Child Calculator.

Factors that influence how much it costs to raise a child according to the USDA include:
  • How many children you have
  • The age of your children
  • Your marital status
  • Which part of the country you live
  • Your household income

Housing is the number one expense for raising a child

Housing

Housing is the number one expense for raising a child no matter how much money you make or whether you are single or married.

Middle-Income Household

The USDA defines middle-income as earning between $59,200-$107,400 per year. Housing accounts for 29 percent of total child-rearing costs.

Low-Income Household

The USDA defines low-income as making less than $59,200 per year. Housing accounts for 33 percent of total child-rearing costs.

High-Income Household

The USDA defines high-income as making more than $107,400 per year. Housing accounts for 26 percent of total child-rearing costs.

location makes a big difference in the average cost of raising a child

Geographic Factors

It’s not surprising that location makes a big difference in the average cost of raising a child. If you live in a big city in the Northeast, expect to pay the most. Choose to live in the Midwest, and your costs of raising your kid go down by about 27 percent since housing, childcare, and education are generally less expensive there.

married-couple households with only one child averaged 27 percent more than spending per child in a two-child, married-couple home

Family Size

Only Children

Do single child families spoil their only child? Based on the data in the USDA report, the answer is yes. Expenditures of married-couple households with only one child averaged 27 percent more than spending per child in a two-child, married-couple home.

Large Families

On the other hand, as you add more kids to the family, the average cost to raise each child goes down–thank you economies of scale and hand-me-downs. The numbers show that for families with three or more children, per child expenses averaged 24 percent less for each child than a child in a two-child family.

Food is the second largest expense for families in the lowest and middle-income groups

Other Expenses

Food is the second largest expense for families in the lowest and middle-income groups. For high earners, childcare and education are the second-highest expense.

The third-largest expense for low-income families is transportation. For middle-income families, the third-largest cost was childcare and education, and for high-income families, it was food.

Plan Ahead

Bottom line: children aren’t cheap. If you break it down by year, you are looking at about an extra $14,600 in expenses every year.

If you are planning to start a family or add to your family, sound financial planning is a must.

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