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Financial Checklist: Can You Afford to Raise Kids?

6 minute read

Joshua Williams

By Joshua Williams

Most parents will tell you that raising a child is a joy like no other. But be that as it may, it should not be forgotten that child-rearing is also an unparalleled financial responsibility. In addition to diaper changing, potty training, and teenage angst, prospective parents are committing to at least 18 years of paying their child’s way through life.

Unfortunately, many parents underestimate these costs both before having kids and subsequently throughout. If you have never been a parent or done the research, it can be truly astonishing to learn how much it will cost to raise children over the span of an 18 year period. Citing data from the Department of Agriculture, MSN “estimates that families making $70,200 a year or more will spend a whopping $269,520 to raise a child from birth through age 17.”

Today, WalletGenius will put the financial side of parenthood into perspective by considering some of these unavoidable expenses.

More Spacious Housing

One of the first financial adjustments made upon learning that a child is on the way is a change of living quarters. While a cozy apartment might be suitable for a bachelor or young couple, it will in all likelihood be inadequate for raising a child. The USDA finds that on average, parents will require an extra 100 to 150 extra square feet of living space for each child they have. At a minimum, you will need space for a baby’s crib, clothing, and toys.

Another consideration here is that many parents prefer to raise their kids in the safest and friendliest neighborhoods they can afford, which are often not the same neighborhoods that are filled with apartment buildings. Ultimately, these parents often opt to buy or rent a home of their own in a different and more expensive area, which escalates their housing costs substantially.

While the parents themselves certainly benefit from these improved living conditions, the fact remains that the change was primarily motivated by the birth of their children. Therefore, if the true costs of child-rearing are to be calculated, the differential between your pre-parenthood housing costs and post-parenthood housing costs must be included. That means a mortgage payment, higher utility bills, and property taxes, which apartment dwellers generally do not pay but which virtually all homeowners must pay.

Health and Medical Expenses

It has become a trend among today’s parents to raise their children with a greater emphasis on healthy living. Organic diets, plenty of fruits and veggies, and limits on soda and junk food are just some of the steps taken to prevent kids from becoming ill.

Despite these laudable precautions, it is simply unavoidable that your child will get sick and require medical attention, if only in the earliest years of his or her life. Even the most pristinely raised, genetically advantaged child will require shots, immunizations, preventative screenings, regular checkups, dental care, and prescription medication for common childhood ailments like ear infections.

If your child is the adventurous type and breaks a bone while playing sports or climbing trees, you can add hospitalizations to the list. Other children require braces, glasses, contact lenses, or skin medication.

Granted, most medical expenses in the United States are paid via third parties. However, the wide range of predictable child health expenses makes clear the urgency of being prepared. Furthermore, a health insurance plan that has been sufficient for you and your partner may not cover enough or any of the medical expenses after childbirth.

If you have not yet addressed the matter of how to provide for your child’s medical expenses, now is the time to do so.

A College Education

A generation or two ago, a college education was perceived as a luxury reserved for the upper crust of society. Today, it is a baseline necessity for even entry-level positions in virtually all fields. Indeed, some job descriptions state that having a degree is a prerequisite to your application being considered at all.

Sadly, the cost of a college education is headed nowhere but up. According to a February 2010 article in the Washington Post, “tuition, fees and living expenses at private nonprofit colleges average $35,640 in the 2009-10 academic year.” In inflation-adjusted dollars, the Post writes that this represents a 15 percent increase since 2004. If your child is still young or if you have not yet had one, you should be starting to see the writing on the wall. If the last 20 years are any indication, sending your child to college will cost considerably more than $35,640. While the Post notes that the availability of financial aid has also gone up, this cannot be relied upon to continue.

Parents who want to ensure that their kids can attend college must begin saving early and continue saving often. Various resources exist to help parents fund their child’s college education. This includes 529 accounts, which essentially function like an IRA or 401(k) for college savings. Parents can plow away up to $200,000 in some states into 529 accounts and the resulting growth is exempted from federal and state income taxes.


The USDA indicates that roughly 15 percent to 20 percent of all child-rearing costs derive from food spending.

It goes without saying that each child you have is one more mouth to feed for however long that child lives with you. In the early years, this typically includes specialized baby food and formula. As your child gets older, your food bill will expand to include an extra plate at breakfast, lunch, and dinner, whether you are at home or on vacation.

Nor is your grocery store bill necessarily the extent of your food expenses. As your child grows beyond baby-food age, you will often find yourself eating out at restaurants, ordering take out, stopping in at convenience stores, using vending machines, and the like. While these costs are easier to ignore — since they are scattered amongst dozens or hundreds of different receipts and bank statements — they are no less a part of your food bill than the more standardized grocery store trips you make once or twice a week.

The USDA predicts that you will spend $26,490 to $39,470 on food for your child from birth to age 17.


Another frequently understated expense of raising a child is clothing. In the early years, it’s all well and good to expect that you can get by on hand-me-downs and donations from friends and family. But as your child grows, you will frequently want or need to buy their clothing, whether new or used. Once your child begins advancing through school, it is likely that they will start lobbying you to buy them certain brands and styles.

Clothing appears to be another area in which USDA estimates — $8,490 to $12,810 in this case — fall short of realistic cost projections. As Nancy Gibbs of Time Magazine opines, “I’m thinking the bureaucrats have not been to a mall lately since their tables allow about $60 a month for kids’ shoes and clothes.” Nor, evidently, have the bureaucrats witnessed how easily and regularly kids make their clothes obsolete with rips, tears, or stains from sports and outdoor adventures.

Miscellaneous Expenses

Naturally, a great many child-rearing expenses defy neat, obvious categorization. Many parents, for example, urge their children to participate in youth sports leagues, dance or ballet lessons, Boy/Girl Scouts, and other extracurricular activities. Little league baseball can be particularly expensive, requiring not only fees and dues to the league but also bats, gloves, uniforms, refreshments for game day, and travel for road games. Then there are entertainment expenses, such as trips to the movies or the zoo.

While the USDA allots $13,380 to $32,460 for so-called “miscellaneous” expenses, this seemingly arbitrary figure should be taken with a grain of salt, as every family has different tastes and will almost certainly spend a different amount. Your expenses in this category could fall far short or rise well in excess of that figure. Nevertheless, miscellaneous expenses warrant extra consideration precisely because it is a catch-all category and is so very easy to gloss over.

Baby Kids Shoes with Coins on ThemAfrica Studio / Shutterstock
Joshua Williams


Joshua is a freelance writer with years of experience blogging about business and finance, and a whole host of other things too. When he's not writing, he enjoys camping with his dog, a golden retriever named Oakley.


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