Rising costs of child rearing

Raising children is probably the most important thing that parents do. But, anyone who has done it knows it is costly, both in terms of time and money. Every year the federal government publishes numbers estimating the money costs. Host Mary Walden asks her husband NC State economist Mike Walden, “What are the latest amounts?”

Mike Walden: “Well, these numbers, Mary, are for a child born in 2013. And, hold on to your hat: The latest numbers show that to raise a new born child born in 2013 through their first 18 years of living and to cover costs like food, their share of the housing costs, their share of transportation , clothing, etc. — $245,000. Two hundred and forty-five thousand dollars over 18 years; now this is not including any money set aside for higher education, and it also does not include inflation. It’s in what we call ‘real dollars.’ If you include inflation, projected inflation, you’re looking at over $300,000. These costs were actually up a little under 2 percent from 2012. Now, there are some major regional differences particularly on housing costs, which actually turn out to be good for us because the costs have slightly lowered here in the South where housing costs tend to be slightly lower. Now, obviously that $245,000 seems like a big amount of money, but realize it is spread over 18 years and also realize families can make some adjustments to lower these costs, especially if you have multiple children reusing clothing, making more use of computers etc., for multiple children. But, I think it does indicate that raising a child — although extremely important, we obviously need children to keep our future going — it is a financial commitment, and I think having some number in mind is good for people in terms of their planning.”

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