Parents Projected to Spend $241,080 to Raise a Child Born in 2012, According to USDA Report
WASHINGTON, August 14, 2013 - Today, the U.S. Department of Agriculture (USDA) released its annual report, Expenditures on Children by Families, also known as the Cost of Raising a Child. The report shows that a middle-income family with a child born in 2012 can expect to spend about $241,080 ($301,970 adjusted for projected inflation*) for food, shelter, and other necessities associated with child-rearing expenses over the next 17 years. This represents a 2.6 percent increase from 2011. Expenses for child care, education, health care, and clothing saw the largest percentage increases related to child rearing from 2011. However, there were smaller increases in housing, food, transportation, and miscellaneous expenses during the same period. The 2.6 percent increase from 2011 to 2012 is also lower than the average annual increase of 4.4 percent since 1960.
"As the economy continues to recover, families are naturally cost conscious. This report gives families with children a greater awareness of the expenses they are likely to face," said USDA Food, Nutrition and Consumer Services Under Secretary Kevin Concannon. "The report is also a valuable resource for courts and state governments in determining child support guidelines and foster care payments."
The report, issued annually, is based on data from the Federal government's Consumer Expenditure Survey, the most comprehensive source of information available on household expenditures. For the year 2012, annual child-rearing expenses per child for a middle-income, two-parent family ranged from $12,600 to $14,700, depending on the age of the child.
The report, developed by the USDA Center for Nutrition Policy and Promotion (CNPP), notes that family income affects child-rearing costs. A family earning less than $60,640 per year can expect to spend a total of $173,490 (in 2012 dollars) on a child from birth through high school. Middle-income parents with an income between $60,640 and $105,000 can expect to spend $241,080**; and a family earning more than $105,000 can expect to spend $399,780.
"One of the major expenses on children is food, and at USDA many of our programs are focused on making sure that children have access to healthy foods," said CNPP Acting Executive Director Robert Post, Ph.D. "On our website we provide shopping strategies and meal planning advice to help families serve more nutritious meals affordably through the 10-Tips Nutrition Series and the Thrifty Food Plan. Our MyPlate symbol and the resources at ChooseMyPlate.gov provide quick, easy reference tools to facilitate healthy eating."
For middle-income families, housing costs are the single largest expenditure on a child, averaging $71,820 or 30 percent of the total cost over 17 years. Child care and education (for those incurring these expenses) and food were the next two largest expenses, accounting for 18 and 16 percent of the total cost over 17 years. These estimates do not include costs associated with pregnancy or education beyond high school.
The report notes geographic variations in the cost of raising a child, with expenses the highest for families living in the urban Northeast, followed by the urban West and urban Midwest. Families living in the urban South and rural areas have the lowest child-rearing expenses.
"Lower housing costs contributed to the reduced expenditures for families in rural areas," explained study author and economist Mark Lino, Ph.D. "Families in rural areas also saw lower child-care and education expenses."
In 1960, the first year the report was issued, a middle-income family could have expected to spend $25,230 ($195,690 in 2012 dollars) to raise a child through age 17. Housing was the largest expense on a child both then and now. Health care expenses for a child doubled as a percentage of total child-rearing costs. In addition, some current-day costs, such as child care, were negligible in 1960.
Expenses per child decrease as a family has more children. Families with three or more children spend 22 percent less per child than families with two children. As families have more children, the children can share bedrooms, clothing and toys can be handed down to younger children, food can be purchased in larger and more economical quantities, and private schools or child care centers may offer sibling discounts.
The full report, Expenditures on Children by Families (2012), is available on the web at www.cnpp.usda.gov. In addition, families can enter the number and ages of their children to obtain an estimate of costs through an interactive web version of the report.