November 7, 2013 | Posted in:Living on less


Apparently it costs about $15k every year to raise a child through age 18.

A sustained $15k per year for 18 years!? I call bullshit!

Silly Middle Class Americans with your big spending! You aren’t as bad as the High Income folks, though, who will spend around 166% as much (around $25k per year).

While I’ll admit that kids add an extra bit of fluff to the monthly budget I won’t concede to the notion that “kids are expensive”.

Let’s look at the annual budget breakdown of the cost of both of my children’s first years vs. CNN’s “Average American”.

All numbers will relate to the North Eastern United States (where I live), because they’re the highest in the country. And absolutely ridiculous.

The cost of raising a child

(click to enlarge)

Child Care and Education

Being in the Middle Class you’re more than likely not up for any big tax breaks when it comes to Child Care. You make too much damn money for the government to feel bad for you! You’ll get a little bit back on taxes, but not much.

The average family is going to spend around $4,000 per year on Child Care.

According to my ultra-scientific calculations that comes out to $375 per month. I’d say that’s a pretty substantial bite to the monthly budget.

Woah! I wish Child Care would only cost $375 per month. With one child we were spending $600 per month. After putting our second daughter into Child Care it dropped the individual price a little bit — but it still runs us $1,100 monthly.

Average citizen spending: $4,000
Moneyseed household spending: $7,200 (1 child) | $13,200 (2 children)


We’re in a time of ever changing Healthcare costs. Especially with the Affordable Care Act rolling into effect, uncertainty in this category is rampant. However, the graphic says that Mr. and Mrs. Middle Class are spending around $500 a year per child for healthcare.

$500 for an entire year is negligible. $40ish bucks a month? I guess it needs to be factored into the equation, but this is less than the cost of going to the movies!

Our healthcare expenses are 100% paid for by our employer, so we save big here. I’m able to see how much our employer pays for our coverage though.

For a single person it’s $209 per month. For a family it’s $475 per month. So the full cost ($475) minus the coverage for both adults ($418) leaves $57 to cover our children. Both of them.

Average citizen spending: $500
Moneyseed household spending (as if this was out of pocket): $684

Clothing and Miscellaneous

Up through this point, we’ve looked at some of the expenses that you really don’t have much control over. You can get cheaper healthcare and child care, but I don’t think those areas are worth skimping on.

You do have control when it comes to spending in the clothing and miscellaneous (whatever that means) category. Average North Eastern Americans are spending around $1,700 per year here.

My guess is that miscellaneous is referring to everything that isn’t clothing like: toys, towels, diapers, blankets, pacifiers, swings, changing tables, etc.

In 2012 with 1.25 children (daughter #2 was born in September) we spent a total of $848 on clothing and stuff. This year I’ve projected that we’ll spend $987 for 2 kids. This is mainly due to the fact that most things marketed towards first time parents are completely bullshit. And we were smart enough to realize that.

Average citizen spending: $1,700
Moneyseed household spending: $848 (1 child) | $987 (2 children)


Here’s where shit starts to get ridiculous. Who the hell is spending $1,300 a year on their kids to eat food? Especially babies. The average American family is, but seriously what the hell are they feeding their kids!?

Baby food. Expensive formula. Juice boxes. Gimmicks.

2012 was a great year for our family. It was our first full year as parents. It was also a year where our average grocery bill DROPPED by about $25/week.

2013 has been even better. Our grocery spending has DROPPED another $25/week! So, two years in a row we’ve seen significant declines in spending, while continuously making our diets healthier over time.

While I feel inclined to post a negative number in this category, I will include the cost of formula (which we had to use for about 20 weeks for each child). 20 weeks worth of formula ran us $220 for both 2012 and 2013.

Average citizen spending: $1,300
Moneyseed household spending: $220 (2012) | $220 (2013)


Now we’re on the meat of the “cost to raise a child”. The part that makes up around $7,000/year. The part that I don’t really understand whatsoever.

My children have almost ZERO effect on our housing or transportation costs. We didn’t run out and buy a minivan when our kids were born. And we didn’t shop around for a bigger house. We actually downsized our house around the time our younger daughter turned 1.

One logical expense in the transportation category is car seats. You shouldn’t buy used car seats, because you don’t know their history. But you CAN reuse the ones you do buy for subsequent children. A decent car seat costs around $150. We’ve purchased 2 car seats, and one $70 booster. $370 total.

As far as housing goes, I’ll assume this is where cribs fall into. We bought a decent crib from Target for our first daughter for $150. She has since grown out of it, into a bed, so now our #2 uses the crib.

No other area of our housing or transportation costs are directly related to the raising of our children.

Average citizen spending: $7,000
Moneyseed household spending: $300 (1 child) | $220 (2 children)

Here’s a nifty table with all the numbers

Average US Family (Northeast)Moneyseeds with One ChildMoneyseeds with Two Children
Child Care$4,000$7,200$13,200
Tax Breaks!Already factored in-$2,450-$3,400
Annual Spending$14,500$6,776$11,855

This is why I think the numbers are bullshit

CNN’s “Cost to raise a child” interactive graph lets you change between regions and income brackets. I flipped through all of the options and made a few observations.

It’s understandable why it would be more expensive to raise a child in the Northeast than the Midwest or the South. The cost of living is higher in the Northeast. Makes sense.

It even makes sense that there is a spending gap between Low and Middle income families. Lower income families usually qualify for more tax breaks and assistance programs than Middle or High income earners.

But why the hell is there such a HUGE disparity between Middle and High income earners? In the Urban Northeast High income earners, on average, will spend $168k more over 18 years on their children. That’s a difference of over $9,000 per year.

This is where you have to understand that the “high cost of having a child” is based on your personal spending HABITS — rather than natural costs. Bigger houses, more luxurious vehicles and private schools are a choice. It’s lifestyle inflation. It’s sickening.

Raising children doesn’t need to be expensive!

Raising children has a certain stigma of being expensive. Personally, I hate when people use blanket statements like “this or that is expensive”. If we give in to these notions that “things are expensive” they will ultimately get the better of us. We’ll end up spending more just because we think that it’s the norm. This goes for anything from cars to electronics to vacations to children.

I don’t question the accuracy of CNN’s statistics either. The Average American is awful with money. Their bad spending habits are exacerbated when they bring children into existence.

You don’t need to be perfect to not be a sucker. As a family our spending isn’t perfect, but we continuously try to optimize our spending so that we can afford more stuff for less money.

One example of this is children’s clothes. When our first daughter was born we were given an enormous (and free) box of clothes from a friend. Since her daughter had grown out of them, she had no use for clothing sized 0-24 months. With gift cards from our baby shower we supplemented this new wardrobe with a few new items from Babies R Us.

It was through this process that we realized how EXPENSIVE it is to buy brand new baby clothes. Since then, all clothes shopping has been done at Goodwill, or similar thrift stores. You can literally buy an entire bag of clothes for the price of one single outfit at Babies R Us. Awesome clothes too. Our kids are the best dressed kids at daycare.

my super cute children - The cost of raising a child

There isn’t much wiggle room when it comes to healthcare and childcare costs, unfortunately. But these two things are SUPER important to a child’s life. Can you really put a price on health or education? Obviously we don’t want to experience price-gouging, but instead of complaining about how much each of these specific things costs, let’s focus our attention on the things that we have the power to control…

…like the costs of food, clothing, miscellaneous, transportation and housing!

I’m not going to go in depth for each category, because I think it’s redundant. And the point is very simple: Some things are price non-negotiable, deal with it. Everything else is a choice and you have the power to spend smart or spend like the Average American.

What are your child care costs like? Do you think the numbers are as bullshit as I do? Explain in the comments below.

**Oh yeah! We’re expecting another baby in March. But don’t expect our spending for 3 kids to be any higher than the Average spending for one :)

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  1. Broke Millennial
    November 7, 2013

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    In the urban Northeast parents are kind enough to pay insane sums to babysitters and nannies thus dramatically jacking up the cost of childcare! Yay for my wallet!

    I’m curious what my parents spent…I wouldn’t be surprised if my Mom has an itemized list with the answer.

    • Mrs. Moneyseed
      November 8, 2013

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      I remember babysitting in the midwest (southern IL to be exact) from 2000-2004ish. I was lucky to make $5 an hour, and it didn’t matter their ages or how many kids the family had, which seemed odd to me. However, starting in 2005, I started nannying for a rather large family and made $600 a week! At the time I thought this was huge, but now that I know what multiple child care costs…I’m not so impressed. (Maybe for the time it was still good? Especially since I wasn’t certified in anything.) However, I was 19, clueless as to what I wanted to do with my life, so it was probably a good thing that I didn’t earn anymore! Otherwise I would have just ended up wasting more money and would still have nothing to show for it…ha!

  2. Retire Before Dad
    November 7, 2013

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    Yeah some of those CNN numbers are out of wack. Especially daycare. Maybe they factor in people who don’t need it. There definitely are a lot of Misc things to buy that you don’t expect, but just about everything can be found second hand. With our second we had to buy a new rug and crib mattress recently among many other surprises. But since having kids, we are saving a ton of money because we don’t go out nearly as much as we used to. Glad you figured in the tax break too.


    • Mrs. Moneyseed
      November 8, 2013

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      We’ve also found a lot of very cheap to free options for things to do as a family, which helps a lot with not feeling “stuck in the house”. We do luck out quite a bit being in the military as we often get highly discounted if not free admission to certain attractions. Also, our new downsized home is on a road that dead ends at a park, less than a block from our house! Obviously, we couldn’t turn that prime location down! Yay for hours of free child-friendly entertainment that doesn’t involve a screen!

  3. Michelle
    November 7, 2013

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    No kids for me and the husband, but I’ve been researching child care costs in my area (Chicago). It’s pretty redic. My sister pays peanuts for her daycare vs. what I’ll probably pay for ours. Just quickly browsing, I’m seeing $1500 a month for low end and $3500 for the higher end centers. YIKES.

    • Mrs. Moneyseed
      November 8, 2013

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      I have family and friends who were fortunate to have the option to cut their work week down to 3 total, or 3 days in the office and 2 days at home, which significantly helped reduce their childcare costs. Other friends found it more economical to hire full-time/live-in nannies/au pairs to greatly supplement costs of care for multiple children. Another idea, which may not be ideal for too many families, is the option of working alternating shifts as each other. This could be positive in that the children are having quality time with both parents, but it leaves little opportunity for whole family interaction aside from the weekends. It just depends on what sacrifices you are willing to make to possibly completely eliminate child care costs. There are tons of options for childcare, sometimes you just need to get creative.

  4. anna
    November 8, 2013

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    Congrats on #3, Moneyseeds!! I have to agree with Michelle above about childcare. Our biggest concern is infant daycare is easily $1400-$2k just for one, let alone multiples in SD. But we do agree with minimizing costs besides that through pre-owned clothing and such… luckily I have quite a few friends whose kids have outgrown that phase! :)

    • Mrs. Moneyseed
      November 8, 2013

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      Thanks!! We are very excited! And there is nothing like hand-me-downs!!! Right now #2 is too little to know that most of what she wears was previously worn by her older sister. She may end up hating it as she gets older, but I think it will be helpful for her to know that the oldest didn’t get the clothes brand new either. It’s also much easier to find brand name clothes (often times still with the tags on them) for next to nothing! This definitely makes buying all of the children something of their own that is “brand new” more affordable, so no one ends up feeling neglected. Hopefully, these ideas would curb any possible resentment.

  5. Jen @ Jen Spends
    November 8, 2013

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    Both my boys for a little while required hypoallergenic baby formula that cost $300+ per month, which was really tough to deal with. Other than that, though, it really is about choices. We don’t have anyone giving us hand-me-downs, but I have a lot of luck buying new clothes on clearance with additional coupon codes. I make my own baby food, which I really enjoy doing, and it tastes so much better to them. We don’t do convenience foods. Toys are, for the most part, limited to birthdays and Christmas. We’ll see what happens with Obamacare, but currently we pay under $200/mo for health insurance for the whole family, and the boys have no copays.

    I remember seeing these crazy statistics when I was trying to decide if I could be a stay at home mom. You’re right it’s total BS. I hope people who really want kids aren’t discouraged by ridiculous figures. Congrats on baby #3!

    • Mrs. Moneyseed
      November 8, 2013

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      Thank you, Jen! We are keeping our fingers crossed for a boy! But we are keeping it a surprise (even for us), so we won’t find out until March! I have heard of other parents having issues with needing certain brands of diapers for their kids, similar to your boys’ necessity of a specific type of formula. These things happen. But it sounds like you guys have been very smart in limiting spending in other areas! Our girls ate home-made baby food too, but quickly demonstrated that they were more interested in baby-led weaning, which made everything much easier!

    • Mrs. PoP
      November 9, 2013

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      A friend of mine had some crazy issues with her two little ones and food, too. The first required expensive hypoallergenic formula, and then the second had so many GI and motility issues that his formula needs were insanely expensive. Kindof trivial compared to the 30 days in the PICU….
      But they worked through it. They scrimped and got the tiny people what they needed when they were little and counted their lucky stars when both kids were able to adapt to most “normal” foods just fine when they (and their digestive systems) got a little older.

  6. Tara @ Streets Ahead Living
    November 8, 2013

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    Childcare is CRAZY expensive in the Northeast through the entire Bos-Wash region. I interned at NARA in College Park, Md one summer and a person told me their in-building childcare charged $700 A WEEK to newborn aged kids. Obviously, it got a little cheaper once the kid started walking but jeez. I don’t plan on staying in NYC for that reason… even with a stay at home Granny (my mom is moving in with us) we couldn’t even afford to get a place large enough for all of us so that my mom could live rent free.

    I agree with you on the rest of the spending– it’s crazy how parents spend oodles on their kids clothing. Before my kids get super-brand obsessed, it’s thrift store all the way (still stylish of course, I’d never set my kids up for bullying).

    • AnnW
      November 9, 2013

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      In some states a caregiver is only allowed to watch three infants. That is probably why it is so expensive. Also, you want someone trained and experienced with newborns.

  7. Laurie @thefrugalfarmer
    November 8, 2013

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    Awesome post, JM. Having recently moved from a semi-affluent suburb, I can tell you what they spend their cash on: as many extracurricular activities as they can fit in, for the “benefit” of their child, of course, spendy clothes, and every new and cool electronic gadget under the sun that their child “needs” (i.e. has to have in order to be “cool”). The pressure we put on ourselves from comparing ourselves to the Joneses was astronomical and caused us to spend way more money than we had, resulting in a boat load of debt which we are now digging out from under. I can tell you this much: our kids are a whole lot happier now without all of the activities, etc. They have a much higher self-esteem knowing that we don’t care, and that they don’t need to care, about what others think of them. They also are relieved knowing that mom and dad are picking a solid financial footing over the accumulation of stuff. As an aside, I would estimated that our numbers for a family with four kids will likely be $15k total. You’re right on here, Johnny.

  8. Micro
    November 8, 2013

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    Those are some pretty crazy numbers. I don’t have any kids myself but my older brother had his first two years ago. We were talking and he couldn’t understand how people would go and buy little jars of baby food for their kids. They are only like a buck each which doesn’t seem so bad. However, once you factor in mulitple feedings and maybe even multiple jars per feeding, it racks up really quickly. He said he almost stopped a lady buying baby food to tell her a bag of frozen peas only costs a dollar. With that one bag, he got a bunch of meals instead of just one. Who needs gerber when you have steam and a quality blender.

  9. Al
    November 9, 2013

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    I have two girls, 5 and 3. Agree with you, not sure how you assign transportation and housing costs to the kids. General thoughs on expenses:

    1) As long as you aren’t buying designer clothes, kids clothes are easy. Go to a Child’s Place outlet and you’d find $3 shirts and $8 pants. I guess clearance is just to get space for new stuff.

    2) I know that sooner or later, my daughters will come ask me for cool item x. The answer will be no and we’ll look at the allowance they earn and then they can plan to save up. (If anyone has a good link on plans for age appropriate allowance for kids please post. My kids are currently too young to me too useful for cleaning tasks right now.

    3) Alternative items: My 5 year old daughter got a very crappy kids digital camera last christmas. It just eats batteries and it takes garbage pictures. I thought I would support this hobby by doing some alternative buying.

    a) Starting by thinking, OK digital cameras are like 14 megapixels now, surely there are some older models about. Confirmed that the stores only stock newer modesl at $100 +. It is crazy to give a young kid something that’s expensive.

    b) Then started looking at sites like Craigslist. I can get a good looking pink (perfect!) Sony 7.2 mega pixel camera for $40. At that price, I’m happy if it last 2 years and generally I’m sure my daughter will be ready for something else by then.

    A little common sense goes along way in controlling costs for kids.

  10. Justin @ RootofGood
    November 9, 2013

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    I’m with you. Something stinks like B.S. and there are no bovines anywhere near me.

    We skipped the minivan and fit 3 (3!) kids in the back of a honda civic or accord (the cars we have had for 13 years). When babies, they mostly eat table food. The same stuff we eat, often minced up for easier consumption (and choke free dining). Juice boxes (ie sugar water) don’t make it into the shopping cart either.

    Housing? We didn’t move. Clothes? Hand me downs, or we shop at the thrift store or consignment shop.

    Maybe some day the costs will rise for a few years (auto insurance??), but in general they just don’t cost that much money to raise well.

  11. Holly@ClubThrifty
    November 10, 2013

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    My kids don’t go without anything but I rarely spend money on them. They don’t know whether I buy them used or new clothes, for instance. They also don’t care.

    Our biggest expenses have just been paying to have them in the hospital (about 4K each time) and daycare.

    There are a ton of ways to save when you have kids and kids don’t really know the difference anyways. I don’t buy for my kids often so they haven’t learned to expect it.

    • Holly@ClubThrifty
      November 10, 2013

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      Something else to add:

      Even childcare can be something negotiable. In our area, the childcare centers are incredibly expensive. In fact, a few of the centers near where we’re living are $225 per child per week…so $450 per week. Ouch!

      Anyways, we send them to a small in-home daycare instead and it costs $150 per week. Their daycare lady is licensed and has a nice home with lots of toys and books. They aren’t learning French or doing baby yoga like they would at the center but I personally don’t think that that’s worth it!

  12. Dollar Flipper @ Flipping A Dollar
    November 11, 2013

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    Absolutely spot on. I wish our daycare was cheaper, but my wife is almost done with grad school and I’m still in my working years (hopefully only 10 more of those though).

    Your information about clothes is spot on. The other great area to buy clothes are church rummage sales and garage sales. People honestly are happier getting a few bucks for a pile of clothes knowing that some other baby will get to wear them instead of them gathering dust in their basement.

    We just got a bunch of barely used sneakers (really, a 1 year old doesn’t do much damage to shoes, but their feet grow fast and still need to be covered) for $1 a pair at a local church! These would easily cost $20+ each had we tried to buy them new.

    On top of that, eBay is a good source for big lots of baby clothes.

    Finally, we let all our family members buy our daughter new clothes. They want to spend their money like that, perfectly fine! We do offer a gift to her 529 as an alternative though!

  13. Grayson @ Debt Roundup
    November 11, 2013

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    I never understood these costs that they come up with. Where in the hell would you spend that much on housing and transportation? Did you buy your child a small house to live in? Our biggest expense is daycare, but we won’t skimp on that. The food is negligible and so is clothing.

  14. dojo
    November 14, 2013

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    Our child is not yet born (3 more months), but there are some costs involved (healthcare for me, the birth, some clothing for her and all the crap we’ll need for a newborn). I don’t think food is a huge cost (even when she’s bigger), since we do actually eat at home :D

    Clothing and the rest can be kept at a decent amount, she doesn’t need to wear only Armani and Prada anyway.

    It is costly to have a child, but I don’t think it’s THAT costly anyway :)

    • Johnny Moneyseed
      November 14, 2013

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      Good luck with your pregnancy! I hope the rest of it goes smoothly :)

      It’s funny that you say that the baby doesn’t need to wear designer labels. In all honesty babies don’t need to wear clothes that were bought brand-new. You can find tons of actually new clothes from second hand stores and from friends. So, even if you want the baby to be in “designer” clothing it’s feasible to do so without breaking the bank.

      Some costs are unavoidable, of course. But, myself, along with other commenters on this post, are proof that kids aren’t really that expensive.

  15. Slackerjo
    November 17, 2013

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    I read the book “Life at Home in the Twenty-first Century” and the thing that alarmed me was the endless amount of toys in the photographs. Toys spilled out of room upon room, swallowing the house. Low end toys, high end toys. No wonder everyone featured in the book seemed miserable. They were trapped by grinding affluence.

  16. theresa gianna
    November 21, 2013

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    congratulations on baby #3, that’s so wonderful! i just discovered your blog, and i’m loving it (been working my way through “every single post” all week). we have a daughter and another little one due in May, and really it hasn’t been that expensive.
    i’ve been putzing personal finance blogs for a few months now, and it’s been really refreshing to find y’all…people who are planning early retirement AND are actually having babies…keep it up! ;)

    • Johnny Moneyseed
      November 21, 2013

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      Keep having babies or keep writing? ;)

      Thanks Theresa. You have to read the blogs that actually resonate with you and your personal situation. I’m glad I can be that for you.

  17. ADup
    December 6, 2013

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    How about breastfeeding? It’s free, I work full time and manage it. The insurance companies are REQUIRED now, by law, to give you a free electric pump. My son is 7 months and I haven’t paid a dime in formula costs–not to mention he’s never sick due to his strong immunities. Just a thought –its not for everyone, but def its for this penny pincher!

    • Johnny Moneyseed
      December 6, 2013

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      My wife breastfed for as long as she was able to produce. Even with an electric pump, she only lasted about 2-3 months each time. For those that can go the distance, then hell yeah that’s a huge money saver :)

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