Here’s how much it costs to raise a child in 2024: 'Far more expensive than expected’
If you’re wondering how much money you will need to raise a kid this year – or how much you would save by not having one – a recent survey has figured it out for you.
According to a new LendingTree survey of more than 2,000 U.S. consumers, parents of kids younger than 18 years old spend an average of $11,505 a year per child – or $207,090 over an 18-year period.
The survey, published Monday, found that men spend the most money raising a child, at $13,901. That’s followed by millennial parents at $12,484.
Across all parents, 75% said that having and raising children has been "far more expensive than expected."
Most survey respondents (90%) agreed that it would be easier to raise a child if they had more money. In addition, 77% of parents said they’ve had to make financial sacrifices for their children, most commonly by reducing personal spending (81%), delaying investments or retirement (37%) or sacrificing their own education or career (25%).
Almost one-third (31%) of parents said they have fewer children because of their financial situation.
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Despite this, 78% of survey respondents said they’re happy with the number of kids they have, and 72% of parents who have gone into debt raising a child said they still don’t regret it.
"Others may disagree, but I think there’s good debt," LendingTree chief credit analyst Matt Schulz said. "Good debt is that which brings a significant return on investment. Sometimes that return is financial, but sometimes it’s in the form of personal growth, family bonding, memories to last a lifetime or other things that can’t be accounted for on a spreadsheet."
How much does it cost to raise a child?
According to a U.S. Department of Agriculture study published in 2017, the average cost of raising a child from birth through age 17 is $233,610 for a middle-income married couple with two children. This estimate was based on a family of four and excluded any college costs.
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A similar study in 2022 by the Brookings Institution, which used the USDA estimate as a baseline, found that parents could expect to spend $310,605 raising a child born in 2015 through age 17. The study adjusted for higher future inflation.
Last year, another Lending Tree analysis found that families were projected to spend $237,482 over 18 years to raise a child. Their yearly estimate was highest in Hawaii ($30,506) and lowest in Mississippi ($15,555).
Housing, food make up largest expenses
Taking into account the effects of inflation, the company Credit Karma found that parents can expect to spend roughly $306,924 to raise a child born in November 2023.
The company found that housing, food and childcare make up the largest percentage of children’s expenses. And, as children grow, they said you can expect to pay for things including hobbies.
Credit Karma found that housing makes up nearly 30% of the total expenses. Based on the USDA’s annual cost estimates, they found parents pay an average of $5,235 toward housing alone each year.
"Size of home, cost of living, school districts and location will all influence your expenses," Credit Karma said.
Next, food costs made up the second-largest expense to raise a child, at 18%.
There are many factors that can influence this expense — purchasing formula for babies, a child’s age, eating at home versus eating out, and more — but on average, Credit Karma said parent can expect to pay around $3,249 each year on food.
RELATED: Child care costs are highest in these cities, data reveals
Other expenses include childcare and education, transportation, healthcare, and clothing and miscellaneous expenses.
According to internal data by Bank of America, the average child care payment per household has risen over 30% since 2019 with middle- and upper-income families seeing the biggest increase.
As of September 2023, on average, a family spent over $700 per month, 32% higher than the 2019 average. Regionally, consumers in large cities such as San Francisco and Seattle were paying the most for child care, according to the data, followed by Boston, Los Angeles, D.C. and New York City.
Saving for child’s future
Raising a child can get overwhelming after adding up the costs.
Credit Karma suggested looking at your finances and creating a budgeting plan. A parent may also want to consider setting up a 529 college savings plan to ease the stress of future college expenses.
This story was reported from Los Angeles.