The Cost of Raising a Child Has Ballooned to Over $300,000
Brookings’ Jump Scare
Brookings Institution, one of oldest think tanks in the U.S., evaluated the cost of raising a child. The analysis indicated that a married couple with two kids, earning a mid-range income, would on average spend $18,271 annually to raise their youngest child born in 2015 through age 17. The total cost to provide financial support until adulthood came in at a whopping $310,605.
Given that this total doesn’t even include the college years, costs could have some rethinking their family planning. Others may feel motivated to sharpen their pencils as they review budget priorities.
Accelerated Growth
Raising a child has never been cheap. There are many foreseen — and unforeseen — expenses including new clothes, school supplies, and other items to support their learning, development, and safety. Housing, healthcare, child care, and food costs expand along with a growing family. As they get older, participation in sports and other activities can add another dent to the family budget.
This recent study reveals an external force causing the rate at which these expenses rise to accelerate: inflation. The Brookings estimate reflects a 9% increase from two years ago, indicating the impact of price increases that are currently near 40-year highs.
Americans Weigh Tradeoffs
While the news may prompt some Americans to reconsider expanding or starting a family, others may resort to a more ruthless paring of budget line items.
Meanwhile, the Fed is working to tame inflation through the series of rate hikes it initiated in March. The July inflation reading showed their efforts may be paying off. Inflation moderated a bit, but at 8.5% was still high above the central bank’s 2% target.
As Americans weigh the tradeoffs of growing their family, maintaining a long-term perspective may help lessen the anxiety surrounding the current rising costs of raising children.
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