The cost of raising a child varies from country to country.
The cost of raising a child is usually determined according to a formula that accounts for major areas of expenditure, such as food, housing, and clothing. However, any given family’s actual expenses may differ from the estimates. For example, the rent on a home does not usually change when the tenants have another child, so the family’s housing costs may remain the same. In other cases, the home may be too small, in which case the family might move to a larger home at a higher cost
According to Globalissues.org, “Almost half the world—over three billion people—live on less than $2.50 a day.” This statistic includes children. Based on UNICEF statistics, in developing countries the cost is roughly US$900 for raising a child for a year, and US$16,200 for raising a child from birth to age 17. (This calculation is difficult, since families in developing countries often do not operate with currency, but barter or trade to provide for their children.) Half of all children in the world live in poverty.
The annual LV= (Liverpool Victoria) Cost of a Child report calculates the cost of raising a child from birth to 21 years old. A report from 2016 puts the cost as £231,843. The Cost of a child calculations, from birth to 21 years, were compiled by the Centre of Economic and Business Research (CEBR) for LV= in December 2015 and are based on the cost for the 21-year period to December 2015. Additional research was conducted by Opinium Research LLP from 22 to 27 January 2016. The total sample size was 1,000 UK adults with children under the age of 18 and was conducted online. Results have been weighted to nationally representative criteria
Based on a survey by the U.S. Department of Agriculture, the table below shows the estimated Average Spending on Children by Families. The data comes from the Consumer Expenditure Survey by the U.S. Department of Labor, conducted from 2005-06. The figures have been updated to 2011 dollars using the Consumer Price Index. However, some dispute the numbers as being biased high for political reasons (e.g., Texas A&M University Finance Professor H. Swint Friday: “The numbers, reported by the U.S. Department of Agriculture, are outrageously misleading. Often government statistics are produced for political objectives that cause the research methodology to be biased toward finding the highest dollar amount to support the objective.”).
These figures from the USDA go up to age 18, and do not include any college or university education. Nor does it offer any spending estimates if the child remains in the home as a dependent after the age of 18.
Both tables are for the United States overall, not based on any specific region in the country.
Dual-Parent Family – USDA Average Spending per Child (not the basic cost of raising)
|Dual-Parent Family – USDA Average Spending per Child (not the basic cost of raising)|
|Before-tax income: Less than $59,410 (Average = $38,000)|
|0 to 2||2,990||1,160||1,170||640||630||2,040||420||9,050|
|3 to 5||2,990||1,260||1,230||500||590||1,910||620||9,100|
|6 to 8||2,990||1,710||1,350||570||660||1,290||630||8,760|
|9 to 11||2,990||1,970||1,350||580||710||1,910||630||9,520|
|12 to 14||2,990||2,130||1,480||690||1,090||1,110||700||9,960|
|15 to 17||2,990||2,120||1,630||730||1,010||1,290||589||9,970|
|Before-tax income: $59,410 to $102,870 (Average = $79,940)|
|0 to 2||3,920||1,405||1,690||760||850||2,860||890||12,370|
|3 to 5||3,920||1,490||1,740||610||800||2,740||1,090||12,390|
|6 to 8||3,920||2,100||1,860||680||940||1,680||1,110||12,290|
|9 to 11||3,920||2,400||1,870||710||1,000||2,110||1,100||13,110|
|12 to 14||3,920||2,580||1,990||840||1,410||1,910||1,170||13,820|
|15 to 17||3,920||2,570||2,150||900||1,330||2,400||1,050||14,320|
|Before-tax income: More than $102,870 (Average = $180,040)|
|0 to 2||7,100||1,900||2,550||1,050||980||5,090||1,790||20,460|
|3 to 5||7,100||2,000||2,610||880||930||4,970||1,990||20,480|
|6 to 8||7,100||2,630||2,730||970||1,080||3,910||2,000||20,420|
|9 to 11||7,100||2,980||2,730||1,010||1,150||4,350||2,000||21,320|
|12 to 14||7,100||3,190||2,860||1,170||1,610||4,700||2,070||22,700|
|15 to 17||7,100||3,180||3,020||1,280||1,520||6,460||1,950||24,510|
All numbers are in US dollars.
Single-Parent Family – USDA Average Spending per Child (not the basic cost of raising)
|Single-Parent Family – USDA Average Spending per Child (not the basic cost of raising)|
|Before-tax income: Less than 40,410 (Average = $18,350)|
|0 to 2||2,840||1,400||680||410||520||1,400||510||7,760|
|3 to 5||2,840||1,370||920||330||600||1,940||610||8,610|
|6 to 8||2,840||1,830||1,030||340||670||1,940||780||8,450|
|9 to 11||2,840||2,010||1,060||400||620||1,360||740||9,030|
|12 to 14||2,840||2,150||1,130||420||940||1,120||840||9,440|
|15 to 17||2,840||2,270||1,130||460||930||880||670||9,180|
|Before-tax income: $59,410 or more (Average = $107,820)|
|0 to 2||5,880||2,080||1,920||590||980||3,670||1,650||16,770|
|3 to 5||5,880||2,070||2,160||500||1,090||4,210||1,750||17,660|
|6 to 8||5,880||2,680||2,260||530||1,180||3,350||1,930||17,810|
|9 to 11||5,880||3,000||2,300||610||1,110||3,880||1,880||18,660|
|12 to 14||5,880||3,080||2,370||650||1,560||4,150||1,980||19,670|
|15 to 17||5,880||3,220||2,370||730||1,550||5,010||1,810||20,570|
All numbers are in US dollars.
Based on an estimate by Economic Times in April 2011, the cost of raising a child from birth to age of majority (21 Years) for a middle to upper-middle income family comes to about ₹55 lakh (US$77,000) in total.
Cost break up is as follows:
|Cost of raising a child in India (as of April, 2011)|
|Expenditure Class||Estimated Cost (Rs. Lakh)||% of Cost|
Note: Estimate assumes cost of birth, but doesn’t consider any major illness in child.
- ^Shah, Anup (September 20, 2010). “Poverty Facts and Stats”. Global Issues. Retrieved August 5, 2012.
- ^ Jump up to:ab State of the World’s Children, 2005, UNICEF
- ^Martin Ravallion, Shaohua Chen and Prem Sangraula, Dollar a day revisited, World Bank, May 2008
- ^“Raising a child more expensive than buying a house | LV=”. www.lv.com. Retrieved 2019-04-24.
- ^Friday, H. Swint (July 20, 2007). “Cost of raising children not as high as government would have you believe”. caller.com. Retrieved March 31, 2013.
- ^“Cost of Raising Children Calculator”. ABC News.
- ^ Jump up to:ab Lino, Mark. “Expenditures on Children by Families, 2011 (Miscellaneous Publication Number 1528-2011)” (PDF). United States Department of Agriculture, Center for Nutrition Policy and Promotion. Retrieved August 5, 2012.
- ^“How much it cost to raise a child” (pdf). report. Economic Times. 18 April 2011. Retrieved 13 July 2016.
Ofer Abarbanel is a 25 year securities lending broker and expert who has advised many Israeli regulators, among them the Israel Tax Authority, with respect to stock loans, repurchase agreements and credit derivatives. Founder TBIL.co STATX Fund.