Having a Baby
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How Much Will That Little Bundle of Joy Cost You? Try $245,340

It certainly comes as no surprise to parents that raising a child can be expensive. But just how expensive? While many financial studies focus solely on college costs, research by the U.S. Department of Agriculture (USDA) provides parents and prospective parents with a general idea of the cumulative expenses for a child before college kicks in.

The results are sobering. The average total child-rearing costs for a child born in 2013 and living at home through age 17 is now $245,340 (in 2013 dollars). The USDA calculations include a wide variety of expenses, including housing, child care and education, health care, clothing, transportation, food, personal care, and entertainment.

Estimated Cumulative Child-Rearing Expenditures, 2013-2030

Lowest Income Group ($61,530) $176,550
Middle Income Group (between $61,530 and $106,540) $245,340
Highest Income Group ($106,540) $407,820

Source: USDA, News Release No. 0179.14, August 18, 2014.

Two-parent households in the lowest income group (those earning under $61,530 per year) are estimated to spend between $9,130 to $10,400 per year on average; those in the medium income group (earning between $61,530 and $106,540) can expect to spend between $12,800 and $14,970 per year; and those in the highest income group (with incomes above $106,540) can expect to spend between $21,330 and $25,700 on average.

For a middle-income family with two children, the largest expenditures are:

  • Housing, at an average of 30% of total expenses.
  • Child care/education, 18%.
  • Food, 16%.
  • Transportation, 14%.
  • Health care, 8%.

Not surprisingly, geography matters. Parents in the "Urban Northeast" had the highest average expenses, while those in "Rural" areas had the lowest. It also should come as no surprise to parents that it is generally more expensive to raise a child today than it was when they were children.

The USDA website has a free calculator that can help parents estimate their child care costs. The Cost of Raising a Child Calculator factors in geography, single or two-parent status, and the costs of additional children.

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Lino, Mark. Expenditures on Children by Families, 2013, United States Department of Agriculture, Center for Nutrition Policy and Promotion. Miscellaneous Publication No. 1528-2013. August 2014.

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