Parents Projected to Spend $245,000 to Raise Kids Born in 2013
If you were one of the millions of parents who welcomed a child into your life in 2013, a report from the U.S. Department of Agriculture (USDA) projects that it will cost about $245,340 to raise your little bundle of joy until he or she is 18.
The annual 'Cost of Raising a Child' report was released on Monday and projected a 1.8 percent overall increase from 2012 for food, housing, childcare, education and other expenses until their eighteenth birthday. The projected total, however, doesn't include pregnancy expenses or the cost of higher education.
The report uses data from the federal government's Consumer Expenditure Survey. In a middle-income, two-parent household, the annual expenses break down to about $12,800 to almost $15,000 depending on the age of the child.
Projections are based on middle-income families and varied by geographic location. In the urban south, the cost was projected at $230,610 whereas the urban northeast it jumps to $282,480. The rural parts of the county have lesser costs at $193,590.
Child-rearing costs were also determined by family income. Families earning less than $61,500 will spend about $176,550, while a family earning more than $106,540 can expect to spend $407,820.
Housing remains the highest cost of raising a child, but percentages of costs have changed since the survey began in 1960. Then, a middle-income family could have expected to spend $25,230, equal to about $198,560 in today's dollars. Health care expenses have doubled as a percentage since that time and child care, while a large expense now, was negligible in 1960.
Per-child expenses decrease as families have more kids because children can share bedrooms, toys and clothing. Food can be purchased in bulk and schools and childcare centers sometimes offer sibling discounts. Families with two children spend more than 20 percent more per child than families with three or more.
The full report, Expenditures on Children by Families, 2013, is available on the web at cnpp.usda.gov. In addition, families can enter the number and ages of their children to obtain an estimate of costs with a calculator via the interactive web version of the report.