I have read various figures in the last few years about the cost of raising children and starting a family. I am always appalled to see the ballpark figure of raising a child to be hundreds of thousands of dollars per child. The latest figure I saw from Investopedia stated the average cost of raising a child is over $310,000. As someone who crunches numbers and creates a budget, I can’t imagine this figure to be true, at least not for us. Costs cited include housing, food, daycare. I don’t believe college costs are factored into this equation at all.
Photo by Ben Wicks on Unsplash
My Thoughts on the $300,000 Question of Raising a Child
Firstly, we have to pay for housing regardless of if we have children or not. The cost of housing doesn’t necessarily double per person in the family. We started out in our first year together in a 560 square foot apartment that cost $565 per month. Can you imagine!! Once we knew we were expecting, we moved to a 2 bedroom, 1.5 bath townhouse and that cost $750 per month in rent. We then saved aggressively for 2 years for a down payment on a house. We bought a 1400 square foot house with 3 bedrooms and 2 baths with a 30 year mortgage that cost 930 a month all in. Of course, this has increased year over year with a 15 year refinance and the yearly increase in assessed value that translates to increased tax costs. Our housing didn’t increase due to adding a 2nd child to the mix. For housing for 4 people, we currently pay around $1100 per month. This will soon change to $0 when the mortgage is FINALLY paid off.
Ditto food. Food expenses have gone up exponentially since we first tracked out monthly grocery expense. WAAY back in time, in 2012 we were able to survive on a budget of around $200 per month for 2 people. Obviously, this is unfathomable now since a can of corn costs 86 cents and a pound of 80% burger meat is around $5. But food costs haven’t increased due to more mouths to feed until very recently. My 2 year old survives off of spite, milk and blueberries. She doesn’t eat a ton. My 9 year old has recently had an explosion in appetite that correlates with her shooting up in height but she doesn’t eat us out of house and home yet. We spend around $550 a month on groceries and are much less restricted than when were paying off substantial debt in our early years.
I would say the largest factor in raising a child is the cost of daycare. Of course, there are ways around this like working opposite shifts or enlisting the help of willing family. Neither of those work for us, so we are stuck with this particular expense. We pay around $11,000 per year for daycare for one and before and after care for the other. I am SURE this is probably below average, we live in a rural area where cost of living is low and the daycare center has sliding scale tuition. If you can make room in your budget for daycare, that is by far the most pressing expense in raising children. Other than that, the costs of child rearing are highly variable and can be contained with some diligence and attention to detail.
- Clothing for toddlers: Toddlers are a destructive bunch, with little regard to the condition of their shoes and clothing when they are in the midst of making a mudpie. Therefore, most of the clothes I buy for miss Dee are from yardsales, for around a dollar a piece. I do buy new clothes if they are on super sale and tend to stay with Old Navy or Target clearance rack, and Ross or TJ Maxx for inexpensive but good quality sets. I try to stay under $3-4 per piece unless it’s shoes or a coat. I also LOVE Hand me downs. With L, we had very little extra money, and we had friends who were kind enough to bring us bags of hand me downs that proved to be one of the best gifts we’ve ever gotten. With Dee, we have also gotten some hand me downs from family, which is always greatly appreciated. We saved everything between kids and a lot of what Dee wear is from L’s childhood. I have also seen buy nothing yard sales and swaps and love this idea. A lot of times, as adults, we get rid of things that are perfectly functional but don’t suit us anymore and being able to bring your good but boring items and swap with others without paying anything is a great concept!
- Clothing for Older Kiddos: Sadly, Elle (L) is no longer interested in yard sale buys and has developed her own sense of style that cares not for frugality. For Elle, we set an annual budget and she gets to pick out her own clothing and shoes. I am trying to instill in her the concept of buying quality items on sale. Sometimes it works, sometimes it doesn’t. It broke my heart a little to buy her first $70 pair of shoes that were meant to be worn for the whole school year. I foolishly didn’t factor in growth spurts. They lasted for 3 months before they started to squeeze the daylights out of her toes. Lesson learned here. We have gotten some excellent shoe deals at outlets so I think the plan moving forward will be to check out the nearest outlet while on vacation and buy multiple shoes at a decent price that won’t embarrass Elle but won’t break my bank. Because an emergency pair of quality shoes is definitely going to cost more than the strategically purchased, gotta-have name brand shoes that are $15 because they aren’t the latest greatest.
- Car Seats- This is something I don’t skimp on because it will keep my babies safe. But there are still ways to save. I bought a basic Graco carrier for around 100 plus an extra base, knowing it’d last less than a year since it’s a pain to awkwardly carry around 20-30lbs of baby and car seat on one side. I retired that around 1 year old and invested more in the convertible car seats. I bought a midrange seat that goes to 40lbs rear facing, which will likely get Dee to 3 or 4 years old. It then can be used up to 65lbs forward facing. After we graduate from the 5 point harness, I’ll just get a basic booster, maybe one with latch so I don’t have to worry about it flying around everywhere. For both kids, I bought convertible car seats for around $150, which isn’t cheap but should last (God willing and no puke or blowouts) till around 6 years old. I don’t really recommend the budget convertibles, as they usually go only up to 40 or 50lbs and the installation seems much less sturdy on these. But I don’t think it’s really necessary to pay $200+ for a car seat, the more expensive options might have easier installation, more hefty construction, or extra safety features but I didn’t feel the extras justified the extra expense.
- Sports-We are relatively new to this area of expense but I know you can spend upwards of a hundred dollars a month depending on the sport in question and equipment or training involved. To keep costs low, we have chosen sports clinics that were local and community focused and for sports enrollment, stick with the local parks and recs department. We simply don’t have the budget for expensive sports like Gymnastics or travel team sports. Everyone’s priorities are different and whatever works for you is great! For our family, we are not able to pay hundreds per weekend for hotels and takeout, and the cost of expensive equipment, sports fees, and time cost of being out of my home every weekend all weekend. For now, local dance and sports teams are sufficient for the level of interest Elle has expressed.
- Entertainment- There are SO MANY opportunities for free or low costs activities in your area. Check out your local library for crafting or reading/writing events. Home Depot has a monthly free building activity you can take your children to, that will spark their interest in creating. Our local parks and recs program also does building or crafting events, tours based on what’s currently happening, cleanups, etc. There are tons of seasonal fairs that have free and low-cost activities, and delicious local foods. We also utilize free parks in our area. When the sun is out, we like to explore. Nothing beats the laughs we share when we take the dog and the bikes to our local high school, go to the track, and let everyone free to run out their energy and play together or independently. We’ve also done pottery painting fun, trampoline park, and the local climbing sports park. They are all awesome but have some nominal cost. I like to mix free and paid activities so we are spreading out the fun but my kids don’t think I’m a miser.
- Library- For books, magazines, puzzles, and even DVDs, this is the go-to place. I go through phases where I utilize this resource more and less, but in my prime, when I have sufficient free time, we can rent up to 20 books for 2 weeks and my kids get to explore their varied and ever-changing interests. I get to increase my knowledge or entertain myself with spooky stories for free. There is a local book fair that sells books for a very fair price. I love this store but it blows up my plans because I always spend at least $50-$100 of unbudgeted money and bring home a load of things I have to make space for. I am prone to only reading books once so it doesn’t make sense to buy books that I won’t appreciate being on my bookshelf. It just adds clutter and expense. So the library it is! Of course, if my kids have a favorite book or series, I don’t mind investing in their reading. But for me, borrowing makes more sense.
- Vacation- We delude ourselves on an annual basis into thinking this year will be different and the kids will enjoy a week-long adventure. Elle is very flexible in routine and I think if we just had her, we could do a lot of exploring with little cost to our sanity. But Dee, that lady is a stickler for routine. In the moment, she may appreciate a jaunt on the boardwalk or a trip to the zoo. But when nap time hits or bedtime comes and she is out of her routine or in an unfamiliar room to sleep, it can be quite torturous for everyone involved to get her settled. There is always the packing up of the diapers, toys, wipes, sound machine, everything needed for the perfect sleeping environment. The multi hour car ride may be uneventful if Dee is willing to sleep on the way. Or it can be a slog of screaming and temper tantrums. With all this in mind, we oscillate between planning week long vacations and multiple 2-3 day trips to make things more enjoyable. Hopefully, the older Dee gets, the more fun we’ll have going out. But for now, we stay pretty close to home most of the time. We vacation with friends and family and try to split housing costs. We use AirBNB when that makes more sense than a hotel. We try to cook most meals at home and only eat out for special occasions. Last year we went to the outlet malls for school clothes shopping, which proved to be a smart move as we got some good deals. But in general, we don’t budget much for shopping because Art and I mostly have what we need at home, don’t need to bring knick knacks home to clutter our space, and aren’t doing many excursions. We live in the country so when we go somewhere, the trip is the experience. We don’t spring for the paragliding, haunted tours, or other excursions. This may change as the kids get older and their temperaments are more predictable. For now, we make our own fun by playing Uno inside, going for early morning shark tooth searches, and cooking a big breakfast for a slow start to the day.
- Food- It has been said before but I’ll say it again: Aldi. Or whatever your version of Aldi is. We were spending upwards of $800+ dollars a month on groceries and have cut it down to around $550. Just by making that change. I still have to go to the big box store for specialty items or a specific pasta/sauce/etc. But this has saved us a huge amount since we restarted this habit. Elle makes her lunch from scratch rather than buying junky lunchables. I will admit she still occasionally buys one of those but I have been meal prepping lunches for Art and myself. When she expresses interest in a burrito bowl, I am happy to pack one for her. The cost of a chicken or beef bowl is much lower than a lunchable. Ditto a sandwich. We don’t do applesauce pouches, pop-tarts, or any other expensive snack food. Sometimes we spring for fig newtons or Oreos as a special treat. But I don’t buy snack packs for lunches. We do fruit, and if there is a desire for chips, pretzels, or any other snacky food, we buy a big bag and divide ourselves.
- Toys- We have historically budgeted an amount for Christmas and stuck to that. But I have recently noticed that we buy a lot of junk to fill stockings and even out the budget between kids or make sure there are a similar amount of gifts to open. This results in a lot of filler purchases that the kids don’t necessarily care too much about. I have also noticed that we have to throw a lot of “old” toys out to make room for the new toys we and other family have gifted the kids. But the old toys really aren’t that old. They’re from the previous birthday, Easter, Valentine’s day, etc. They’re still practically new. They are often played with for a few days or a few weeks, then relegated to the back of the closet or bottom of the toy chest. The kids are also more wanting ,the more they have. I’ve noticed that my oldest will work to earn enough money from chores to buy a specific stuffed animal or collectible something. But almost the moment she gets it home and opens it, she is wanting for the next thing. Sometimes it’s because the item comes with a helpful pamphlet to tell you all the toys in the series that you don’t yet possess. Other times I notice that the happiness with the first opening of a gift or two whittles down with each additional present opened until the kids are chaotic and disinterested in everything. I think we have gone overboard on gifting of things and aren’t fostering gratitude and the concept of ‘enough’. We have decided to try to focus more on togetherness and being with family over gifted items. We will still, of course, get our kids gifts. But if we are buying so much that we have to donate the last holiday’s gifts, it just seems like such a waste of time and money, and what are we teaching the kids? That what we have will never be enough or last forever. We are always in want of the next thing. Moving forward, we have talked about doing one or two big gifts and then doing a family experience. I like this idea.
- College- We aren’t here yet. We have focused on paying off debt and trying to save for retirement before opening 529s. And there is this question of what happens with that money if the kids don’t want to do college. Can it be used at various trade schools? What happens if they don’t’ want to pursue any higher education? I know it can be rolled into a Roth for them but I know there are certain tax implications on this. I don’t pretend to be an expert on this account but know that sometime soon, we may start to fund a 529 for each kid. But we aren’t planning to put the full cost of college into each. WE can’t afford that and think the kids should have some buy in. Plus, whatever you have saved factors into financial aid eligibility. I don’t know what the right answer is for college savings but I DO Know that I have already floated the idea of community college and dual enrollment classes with Elle. She wants to attend the closest local university because all of her friends talk about attending there. I am hoping she will see the wisdom in staying at home and attending community college for the first two years before transferring there. If anyone has any advise on convincing them to do the smart thing and not the fun thing, please let me know what’s worked for you! I will also be encouraging scholarship applications for Elle. And looking into different careers based on cost of education versus salary on graduation and potential earnings thereafter. Money isn’t everything and our work should absolutely factor in our interests and strengths. But it’s a lot easier to survive when you don’t have $100,000 in debt and when you earn a living wage than when you’re drowning in student loans and working in a job that you’re passionate about but that doesn’t pay enough to cover living cost, much less fund any extra savings.
Photo by Andre Taissin on Unsplash
Disclaimer: Advice provided on this blog is my personal opinion and should not be used as medical advice, legal, or financial advise. It is always recommended to consult your care provider prior to modifying your diet or physical activity routine. For individual-specific finance/legal questions, consult your financial professional or attorney.
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