Child born in 2012 projected to cost $241,080 to raise
A middle-income family will spend $241,080 on average to raise a child born last year to the age of 18, a 2.6 percent increase from a year ago that outpaces the broader inflation rate, according to a government report.
Housing was the largest expense at 30 percent of spending, the U.S. Department of Agriculture said yesterday in an annual report that also showed wealthier families spent triple the amount on entertainment and reading materials as poorer households. Child care was the second-biggest expense in more affluent homes, ahead of food, while health costs pinched all household budgets.
“The cost of raising a child increases as family income goes up because families have more resources,” Kevin Concannon, the USDA’s undersecretary for food, nutrition and consumer services, said on a conference call with reporters. “Conversely, the stresses and the challenges get worse as families have less access to resources.”
Child-raising costs are climbing just as elements of the federal health care overhaul take effect, aiming to limit price gains, and as a rebound in U.S. home prices adds expenses for families. Inflation in the year through June was 1.8 percent, according to the government. The USDA report excluded payments for college.
The study, conducted since 1960, tracks seven categories of spending, such as housing, transportation and clothing, and is used to help courts and government agencies estimate child-support costs, the USDA said.
For a typical two-parent middle-income family, spending on each child was $12,600 to $14,700 in 2012. A family earning less than $60,640 a year will probably spend $173,490 in 2012 dollars, while parents earning more than $105,000 may pay $399,780, according to the study.
Adjusted for anticipated inflation, raising a child in a middle-class family would cost $301,970, the department said.