No one can truly define how beautiful it is for a parent to raise their child. We can quantify, however, how resource-intensive it is to do so.
Calculating how much of a financial burden a child would be is not selfish or cold-hearted. It is essential for anyone who wants a child to understand if they are in a suitable financial situation.
So, how much does it cost to raise a child?
We have the answer to that and seven other vital questions you should consider if you’re planning to have a baby.
How Much Do Kids Cost?
The costs associated with raising a child depend on several factors, the primary one being where you live or plan to raise your family. In our case, we will consider how much it would cost the average American family to raise a single kid until they turn 18.
Based on a 2015 paper by the US Department of Agriculture, the overall price to raise a child born in 2022 to average-income parents could be estimated at $272,049. This figure is adjusted for inflation and doesn’t take into account the cost of higher education, so it’s less than the total cost to raise a child through college. The average annual price comes to $15,113—roughly 30% of the average US yearly wage of $51,916.
We mentioned the average US annual wage, but the average annual household income is higher, standing at $87,864. That means that if both parents work, only about 17% of an average American household’s income is needed to raise a child.
So, kids cost quite a lot.
Fortunately, each additional child costs less, thanks to the wonders of economies of scale.
1. How Much Does It Cost to Raise a Child Monthly?
As we mentioned, it takes roughly $15,000 annually to raise a child until the age of 18, which comes to $1,250 per month.
Let’s break down further those $1,250. A whopping 29% of that amount, or around $362, goes to housing costs. Food is the second biggest monthly expense, at an average of $233 a month.
2. How Much Does a Kid Cost per Year?
Per year, a kid costs around $15,000, according to the report by the US Department of Agriculture mentioned above.
About $4,000 goes to housing expenses, accounting for 29% of the cost of raising a child. The second-highest expense, food, stands at around $2,794, just shy of 18% of the annual average cost to raise a child. The third place goes to childcare and education, which take up 16% of the cost. In the fourth position, we find transportation, which accounts for 15% of a family’s annual child-related expenses.
While those are the big four, there are many additional expenses to take into account, such as clothing, entertainment, healthcare, personal hygiene, or grooming, which amount to 22% of the overall sum.
3. How Much Does It Cost to Raise a Child up to Age 18?
It costs around $272,049 to raise a child until 18, without college expenses.
Higher education costs depend on various factors, which makes it difficult to determine the exact figure. However, we can say that it would take an extra $60,000 per year of college.
4. What Expenses Come From Raising a Child?
Raising a child comes with hundreds of thousands of dollars worth of expenses. Let’s take the previously stated sum of $272,049 and break it down into major and minor payments.
As mentioned before, the biggest three are, in order of importance: housing, food, and childcare/education.
Housing is the most considerable expense, accounting for 29% of the total average cost of raising a child. This percentage takes into account all housing-related costs, like mortgage or maintenance, together with rent or the property’s price itself.
Food, which makes up 18% of the total budget, is the second biggest expense. Unfortunately, the US Department of Agriculture expects these costs to rise in 2022 due to inflation and the recent global economic recession caused by the COVID-19 pandemic.
Childcare and education account for 16% of the total sum. These costs, however, do not account for college.
One could include transportation as the fourth significant expense since it alone accounts for roughly 15% of the cost of parenthood. It gets exceptionally high if you plan on buying and maintaining a car for your child once they get a driver’s license.
Other costs include clothing, healthcare, personal hygiene, entertainment, saving for college, and other minor expenses, all of which account for about 22%.
5. How Much Does a Baby Cost per Month?
If you’ve watched the famous Simpsons intro closely enough, you may have noticed that when the cashier scans Maggie, the cash register shows $847.63—the average monthly cost of raising a baby in the US in 1989.
So, back in 1989, raising a newborn cost around $10,000 annually, or about $24,000 if we adjust for inflation.
Is that sum still the average in the US?
The price to raise a baby during the first 12 months of their life can vary hugely on a case-by-case basis, but the sum can range from $20,000 to $50,000, according to the USDA.
If you’d like to calculate with greater precision how much it will cost you to raise your baby, we highly suggest using this baby cost calculator at babycenter.com.
6. How Much Does It Cost to Raise a Child by State?
We will now analyze the cost of raising a child per year in each US state. Let’s start from the bottom.
The cheapest state to raise a child is Mississippi, at $13,596. The next two most affordable options are Alabama, which stands at $14,614, and Kentucky at $15,157.
Next up, we have Arkansas ($15,203), West Virginia ($15,759), Georgia ($16,165), Michigan ($16,203), North Carolina ($16,444), Montana ($16,473), Idaho ($16,519), Tennessee ($16,546), Ohio ($16,789), Louisiana ($17,076), New Mexico ($17,246), Oklahoma ($17,575), Texas ($17,879), Arizona ($18,165), North Dakota ($18,192), Iowa ($18,209), Utah ($18,301), Wyoming ($18,387), Florida ($18,420), South Carolina ($18,544), Pennsylvania ($18,577), Missouri ($18,781), Rhode Island ($18,804), South Dakota ($18,821), Delaware ($19,217), Wisconsin ($19,625), Nevada ($19,721), Indiana ($19,805), Vermont ($19,884), Nebraska ($20,176), Illinois ($20,512), New Jersey ($20,785), Kansas ($21,201), New Hapshire ($21,273), New York ($21,353), Oregon ($21,575), Alaska ($21,677), Maine ($22,091), Massachussets ($22,677), Washington ($22,679), Virginia ($23,029), Minnesota ($23,283), California ($23,586), Colorado ($23,981), Connecticut ($24,111).
Finally, the three states with the highest costs of raising a child are Maryland, at $25,156, Hawaii, at an impressive $25,828, and the District of Columbia, which is the most expensive on this list, with a whopping cost per year of $28,785.
Seven out of the 10 least expensive states are in the South of the country, which makes perfect sense as the general cost of living is also way lower than in the North.