What is the average cost of raising a child?

Turning Points 3 min read

The joy and love that a new baby brings is priceless. But what about the costs that come with it?

Whether you’re already expecting or simply planning out the next few years with your partner, it’s important to know the potential price tag before you take that next big step. Here’s the breakdown on what you can expect to pay during pregnancy, babyhood, and beyond.

What is the cost to have a baby?

The average medical cost of having a baby in a U.S. hospital is $10,808, according to Business Insider. That number depends on a lot of factors, such as:

  • The type of delivery. C-sections are more expensive than natural deliveries and have become 500% more common since the 1970s.
  • Whether you have health insurance. If you’re insured, your out-of-pocket costs are generally lower and are based on the coinsurance or co-pay for your particular plan.
  • The state you live in. A natural birth with insurance in Alabama costs about $5,230, but the same procedure in New York is $8,463, about 50% higher. For a C-section without insurance, the cost difference is even greater: $13,590 in Alabama compared with nearly $29,000 in Alaska—more than double the cost.
  • Preparation and amount of care. Remember, delivery costs don’t cover complications or extra care. They also don’t factor in basic prenatal care, which can vary based on your insurance and is important for a healthy pregnancy.

How much will I need to spend on baby gear?

Beyond the medical costs involved, babies need a lot of stuff. Some of the basics you’ll want to have include:

  • Travel items like an infant car seat, which is required by law, and a stroller, baby carrier, and diaper bag. Costs for these items can range from $150 to $1,000+ each.
  • A crib. The cost for baby’s bed can vary a lot. Depending on how fancy you go, a crib could set you back anywhere from $180 to $3,000+.
  • Clothes, diapers, nursing or feeding equipment, and other miscellaneous items.

What is the cost to raise a child?

The United States Department of Agriculture estimates it costs approximately $233,610 to raise a child. That number includes all your estimated expenses from birth to 18 years old. Doing the math, that works out to $12,978 per year and $1,081 a month.

If that figure gives you sticker shock, don’t worry. Taking some time to plan your budget before your bundle of joy arrives can help you become (a little) more prepared for parenting.

Here’s what you can expect to budget for:

  • Housing and transportation. In urban areas, this can cost as much as $3,900 per year, while rural areas average around $2,400 per year. The USDA study estimates 15% of child-raising costs will go into keeping baby safe as you travel.
  • Food costs. Nursing or formula feeding? That choice comes with a big price difference during your baby’s first year. Formula can cost anywhere from $900 to $3,000 a year. While nursing may be free, extras like pumps and bottles add up quickly. Naturally, the cost of food will rise as your child gets older (and bigger).
  • Diapers. Babies go through a whopping average of 2,700 diapers in their first year, so be prepared to pay for them. If you’re using disposables, you can expect to pay about $550 during the first year. While cloth diapers are less of an upfront investment (around $250), you’ll need to clean them yourself.
  • Clothing. The average cost for baby clothes is $60 per month. Over the years, all those toddler overalls and pairs of shoes (so many shoes) will add up to about 6% of your total child-raising cost.
  • Childcare. An estimated 16% of your “raising the kid” fund will go toward childcare and education, according to the USDA. Daycare and nannies can be a big expense if you and your partner have to work. You may also want to factor parental leave, especially if you’re self-employed or your employer doesn’t cover it.

Ensuring your child’s future

One thing the USDA estimate doesn’t cover is a college education. If you plan on helping your kid through college, you can expect to pay an average of $20,090 a year for a public university and $45,370 for a private one, which includes room and board. To help cover future costs like these, you may want to think about setting aside additional funds through a 529 college savings plan.

Does the cost of raising a child differ based on where you live?

According to the USDA, the total cost varies based on where in the U.S. you’re planning to raise a family. The Urban Midwest has the lowest estimate of $227,400, while the Urban Northeast has the highest at $264,090. If you live in a rural area, the cost drops even more to $193,020.

Protecting your family for life

Parenting may not come cheap, but it’s still a life-changing experience. As you plan for the future, consider how you can best protect yourself and your new family.

Life insurance can offer financial protection and lifelong peace of mind. And nothing is more important than taking care of the ones you love. Learn how to secure your family’s future with a life insurance policy.

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