How much does it cost to raise a child?

The average cost of raising a child from birth to age 17 has increased by 16% since 1960 — when data was first collected. In 1960, the average total expenditures on a child in a middle-income, married-couple family was $202,020, adjusted for inflation. By 2015 — the latest data available on child-rearing costs — these estimated expenditures increased to $233,610.

But childbirth costs alone have steadily increased over the last two decades. In 2019 — the most recent data available — hospitals in the US charged^[1] patients an average of $22,876 for birthing procedures. That is more than three times what was charged in 2000 ($6,340), according to data from The Department of Health and Human services. While this is what a hospital bills for the stay, how much of that is paid by the family depends on what kind of insurance they have, among other factors.

According to data from the US Department of Agriculture (USDA), a child born in 2015 to a middle-income family costs approximately $12,980 to $13,900 annually^[2] (depending on the age of the child). Inflation adjustments boost those costs by 23% in 2022, ranging from $16,007 to $17,141 per child.

The USDA publishes a report on child expenditures by family, reporting expenses by age of child, household income, family budgets, and region of the country. Its latest report analyzes data from 2015 and prior.

Where do child-raising costs go?

For a middle-income family, housing accounts for the largest share of child costs at 29%. Food is the second largest cost to raise children at 18%. Childcare and education is the third largest expense at 16%.

According to USDA, housing costs include any form of shelter (mortgage payments, property taxes, rent, or insurance), utilities (gas, electricity, fuel, cellphone, and water), and house furnishings and equipment.

Transportation expenses include vehicle payments, down payments, gas expenses, maintenance and repairs, insurance, and public transportation costs.

Childcare and education expenses include day care tuition, other forms of childcare such as babysitting costs, and elementary and high school tuition for private schools. One of the largest excluded expenses is the cost of a college education. According to the National Center for Education Statistics in 2020 annual average undergraduate tuition was $25,281, adjusted for inflation.

Raising children in the US has changed in many ways since 1960. For example, back then, childcare costs were mostly for in-the-home babysitting. But as more women joined the labor force, demand for outside care increased. Childcare and education went from 2% of the cost to raise children in 1960 to 16% in 2015, the biggest increase of any expense category.

The costs of childcare kept going up in more recent years as well. According to Census Bureau data, family childcare costs increased 25% between 2015 and 2020. And low-income families were more likely to be cost-burdened by childcare expenses.

Families spend more money on raising children as household income goes up.

The USDA reports child costs by the lower, middle, and upper thirds of the income distribution. As household income rises, so does the average amount spent on raising children.

For example, families that make less than $59,200 a year in a married-couple, two-child household, spend a range of $9,330 to $9,980 per child.

Families making more than $107,400 spend more than twice that amount per child.

Costs to raise a child increase as age increases

No matter what a household’s income is, child-rearing costs shift depending on the age of the children.

Early in life, childcare expenses are a larger share of the costs. Childcare and education expenses were generally highest for children 6 and younger due to the cost of preschool and private daycare.

As children reach school age, childcare costs go down, but food, healthcare and clothing costs trend upwards

And once children reach their teenage years the cost equation shifts again. Transportation expenses were highest for children aged 15-17. Because teenagers are beginning to drive, transportation expenses such as insurance and vehicle purchases can affect the costs of raising a child for some families.

Overall annual expenses averaged about $300 less for children from birth to 2 years old and averaged $900 more for teenagers between 15 and 17 years old.

Families in the Northeast spend more on child-rearing costs

Families in the urban Northeast spent the most on children, followed by families in the urban West. Child costs for families in rural areas throughout the country were 27% lower than the urban Northeast, primarily due to lower costs of living for categories such as housing and childcare expenses.

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