How Much Will That Little Bundle of Joy Cost You? Try $241,000

The average total child-rearing costs for a child born in 2012 and living at home through age 17 range from $173,490 to $399,780, depending on the family’s income level. 

It certainly comes as no surprise to parents that raising a child can be expensive. But just how expensive?

While many financial studies focus solely on college costs, research by the U.S. Department of Agriculture
(USDA) provides parents and prospective parents with a general idea of the cumulative expenses for a child before college kicks in.

The results are sobering. The average total child-rearing costs for a child born in 2012 and living at home through age 17 is now $241,080. The USDA calculations include a wide variety of expenses, including housing, child care and education, health care, clothing, transportation, food, personal care, and entertainment.

Estimated Cumulative Child-Rearing Expenditures, 2012-2029

Lowest Income Group ($60,640) $173,490 

Middle Income Group (between $60,640 and $105,000) $241,080 

Highest Income Group (>$105,000) $399,780 

Source: USDA, News Release No. 0160.13, August 14, 2013.

Households in the lowest income group (those earning under $60,640 per year) are estimated to spend between $8,480 to $9,630 per year on average; those in the medium income group (those earning between $60,640 and $105,000) can expect to spend between $12,600 and $14,700 per year; and those in the highest income group (those with incomes above $105,000) can expect to spend between $20,930 and $25,180 on average.

For a middle-income family with two children, the largest expenditures are:

  1. Housing, at an average of 30% of total expenses. 
  2. Child care/education, 18%. 
  3. Food, 16%. 
  4. Transportation, 14%. 
  5. Health care, 8%. 

Not surprisingly, geography matters. Parents in the “Urban Northeast” had the highest average expenses, while those in “Rural” areas had the lowest. It also should come as no surprise to parents that it is generally more expensive to raise a child today than it was when they were children.

The USDA website has a free calculator that can help parents estimate their child care costs. The Cost of Raising a Child Calculator factors in geography, single or two-parent status, and the costs of additional children.

© 2015 Wealth Management Systems Inc. All rights reserved.

Lillian Appleby
Author: Lillian Appleby

Lillian Appleby, C(k)P, PPC is a managing director at Angeles Retirement Consulting, LLC and branch manager/registered principal at LPL Financial. Lillian has been a licensed wealth manager and retirement planner since 1990. Securities and advisory services are offered though LPL Financial, a Registered Investment Advisor. Member FINRA/SIPC. For hyperlinks to FINRA and SIPC, and Third party posts found on this profile do not reflect the views of LPL Financial and have not been reviewed by LPL Financial as to accuracy or completeness. For a list of states in which I am registered to do business, please visit