Costs Of Being A Dad

What it Costs to Raise a Child

Costs Of Being A Dad
June 14, 2017

Welcome to parenthood! You are a proud new father, simultaneously overjoyed and terrified. Since you are now responsible for another human being, you should know that the estimate of what it will cost to raise your child is approximately a quarter of a million dollars, without accounting for inflation. If you would like to send him or her to college, you will probably need at least that much more.

A report from the US Department of Agriculture (USDA) estimated the cost of raising a child from birth to age 17 at $233,610 ($284,570 adjusted for inflation). That is for the average middle-income couple; costs ranged from families in the Northeast that will spend around $264,090 to residents in the urban Midwest and rural regions who will spend about $227,400 and $193,020, respectively.

Unfortunately, that figure is not likely to drop, and inflation-adjusted wages are not filling the gap. Costs are up across the board, and certain areas are taking an increasingly large share of the costs – especially health care, childcare and education (pre-school through high school).

That ratio will continue to climb based on recent trends, especially with respect to childcare.

Child Care of America (CCA) has put out an extensive report breaking down the demographics of childcare costs by state and the variations with respect to income and style of child care. Combining their data with Department of Labor statistics, CCA estimated that just in the last year, childcare costs outpaced family income by up to a factor of eight.

The CCA report shows that childcare costs and housing are the two largest components of household expenses by far – varying slightly by region, but each one is approximately twice the expenses of transportation and food, and around five times the expenses of utilities and health care.

The percentages from the USDA report do not show childcare as quite as large of a component. Housing tops the percentages of child-raising costs at 29%, followed by food at 18%, childcare and education at 16%, transportation at 15%, health care at 9%, and clothing at 6%. Miscellaneous costs compose the remaining 7%.

The Department of Health and Human Services (HHS) sets 10% of family income as a general benchmark for affordable childcare – yet in the CCA study, only ten states averaged less than 10% of family income for child care – the Dakotas, plus the southern block of Arkansas, Louisiana, Mississippi, Alabama, Kentucky, Tennessee, Georgia, and South Carolina.

Unfortunately, the actual expenses of childcare are mostly independent of how much you earn. As a result, the disproportionate rise in childcare costs hurts low-income and single-parent families the most. It's no surprise that the steep bill that comes with raising a child can put a strain on your family's finances. If you want to reduce your interest payments and lower your debt, try the free Debt Optimizer by MoneyTips.

Single dads have a difficult enough time handling childcare with a single income (as do single moms), because if they can't find affordable childcare or programs through their work, they have no choice but to rely on friends, relatives, or some form of unlicensed childcare.

For married couples, there will be a threshold earnings value for the lower-earning spouse where it makes economic sense to stay home and care for children – but it may be hard for them to re-enter the workplace if they do. These are not always mothers, as there are increasing numbers of stay-at-home fathers with breadwinning mothers.

It's okay to feel a little overwhelmed and terrified as a new father – there will be plenty more anxious moments along the way, but there will be even more moments filled with joy and wonder. Although it won't show up in your bank account, you are likely to get a great return on your investment of fatherhood. Have a happy Father's Day!

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Erin | 06.15.16 @ 19:10
I honestly don't know how low-income and single parent families afford to send their kids to daycare. We looked into it years ago so I could go to work, and, basically, I would have been working just to pay for childcare. It's crazy. I can't imagine how bad it is now.
Carla | 06.15.16 @ 19:10
I have mad respect for single parents. The cost did surprise me a bit as I did not realize how much was spent on a single child.
Daniel | 06.15.16 @ 19:14
As a single Dad I know the struggles, but face it we do what we have to as our kids are beyond worth it
trish | 06.15.16 @ 19:15
I have so much respect for single parents. My husband works shifts and travels a lot. So we feel like a single family. But I have his support, both emotionally and financially. And there is time when he IS home. I always feel badly complaining about being alone, while its just physically for a few days at a time...
Elaine | 06.15.16 @ 19:15
The weight the "head of the house" has is overwhelming but doing it alone just seems way to hard. Not sure how those who are lower income or those single parents do it.
irene | 06.15.16 @ 19:16
i really don't know how large families even manage these days. the costs are so high
Bobbie | 06.15.16 @ 19:30
I was a divorced parent of two for many years before I re-married. It was rough, but we have everything we needed, just not a lot of room for anything extra in the budget. Daycare was always the biggest expense.
Steffanie | 06.15.16 @ 19:33
No matter the cost, the kids are worth it. We found there are so many things we can live without!
Kamie | 06.15.16 @ 19:41
I always chose to stay the stay at home mom, because in reality I would have been working to pay for child care, so in no way would that have been very helpful. So, I just do online things to make extra side money, and I get to stay home with my kids.
Amanda | 06.15.16 @ 19:44
Been there and done that... was a only income family for years, and a single mom.. it's rough. Not easy and you have to learn to budget very fast, downsize and save every penny.
Nancy | 06.15.16 @ 19:44
As a single mom, I can tell you that it's hard but not impossible. The numbers adjust with your income level. These are average figures.
$commenter.renderDisplayableName() | 03.18.18 @ 06:18

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