Former Assistant Treasury Secretary for Economic Policy Michael Faulkender says there is nothing changing to cause a cutback on the inflationary pressures on 'Kudlow.'
High inflation has made the price of just about everything in the U.S. more expensive — including how much it costs to raise a child.
Research published by LendingTree shows that the cost of child care surged nearly 20% between 2016 and 2021, the latest year for which complete data is available. Annual expenses, excluding tax exemptions or credits, hit $21,681 in 2021, versus $18,167 in 2016, the data shows.
"The cost of everything is rising," said Matt Schulz, LendingTree chief credit analyst. "There’s so much that goes into child care, including rent, payroll, insurance and much more. When all those costs shoot up, the overall cost of child care does, too."
That means the typical family is spending about $237,482 over the course of 18 years to raise a child — and that is excluding the cost of college.
WHY ARE GROCERIES STILL SO EXPENSIVE?
Harper Quinn, 6, who attends Mar Vista Elementary School, enjoys her day off at the Mar Vista Recreation Center in Los Angeles on Aug. 21, 2023. (Genaro Molina / Los Angeles Times via Getty Images / Getty Images)
Another LendingTree study shows that about 75% of parents think that having and raising children has been far more expensive than they expected. In fact, more than half of parents — about 55% — admit to having gone into debt in order to pay for child-related expenses.
Families with young children say the biggest financial burdens of childrearing are food (21%), child care (19%) and clothing (13%).
Child care may soon get even more expensive.
JAMIE DIMON WARNS INFLATION, INTEREST RATES MAY REMAIN ELEVATED
Congress allocated $24 billion in emergency funding to help keep child care providers afloat as part of the American Rescue Plan, passed in 2021. But that pandemic-era program officially expired at the end of September, leaving child care providers in a lurch; experts have warned that without the funding, the industry may see a spate of tuition hikes, layoffs and closures.
Left-leaning think tank the Century Foundation estimated that 70,000 child care programs will close as a result of the funding expiration, resulting in 3.2 million children losing access to care.
A classroom at The Growing Tree Academy in New Glarus, Wisconsin, on Sept. 13, 2023. (Matthew Ludak for The Washington Post via Getty Images / Getty Images)
GET FOX BUSINESS ON THE GO BY CLICKING HERE
"[Child care] prices could rise further," a recent Bank of America Institute study said. "This could have a meaningful impact on consumers because over 12% of U.S. households pay for child care on a regular basis… and any further increase in prices would disproportionally weigh on families with young children."
If prices continue to climb, it could force consumers to pull back on spending in other areas.
While inflation has fallen from the highs of mid-2022, many families have yet to see material relief. Food prices are up 21% from the start of 2021, while shelter costs are up 20%, according to FOX Business calculations. Energy prices, meanwhile, are up 36.8%.
Chronically high prices are forcing Americans to spend about $1,069 more per month than they did three years ago, before the inflation crisis began, according to a recent estimate from Moody's Analytics.
FAQs
Annual expenses, excluding tax exemptions or credits, hit $21,681 in 2021, versus $18,167 in 2016, the data shows. That means the typical family is spending about $237,482 over the course of 18 years to raise a child — and that is excluding the cost of college.
What is the most expensive state to raise a child? ›
Hawaii is most expensive state to raise child
Basic annual expenses to raise a small child in 2021 equaled $30,506 in Hawaii, more than any other state. The District of Columbia and the state of Washington followed at $30,097 and $28,116, respectively.
What is the biggest cost of raising a child in America? ›
Housing. Housing is the most expensive cost associated with raising a child, making up 29% of the total expenses. Based on the USDA's annual cost estimates, you're looking at about $5,235 going toward housing alone each year.
What is the true cost of raising a child? ›
Prepare yourself for the sticker shock: According to a 2023 study by LendingTree, the nationwide average for the cost of raising a child is $21,681 per year. The study took into account rent, food, child care, clothing, transportation, health insurance premiums and state tax exemptions or credits.
How much does it cost to raise a child to 18 in 2024? ›
At that time, it found the cost of raising a child born in 2015 was $233,610. That assumes the child was born to a middle-income, married couple. When adjusted for inflation, the number jumps to $312,202 as of March 2024, based on data from the U.S. Bureau of Labor Statistics.
Why is having a child so expensive in the US? ›
"There's so much that goes into child care, including rent, payroll, insurance and much more. When all those costs shoot up, the overall cost of child care does, too." That means the typical family is spending about $237,482 over the course of 18 years to raise a child — and that is excluding the cost of college.
What state is #1 to raise children? ›
For the second year in a row, Massachusetts is the best state to raise a family. The New England state earned a total score of 66.97 and ranked first in education and child care.
What is the most expensive country to raise a child? ›
The cost of raising a child to age 18 in China is 6.3 times higher than the country's GDP per capita, the report said – a ratio second only to its East Asian neighbor South Korea, which has the world's lowest fertility rate, and where the cost of child-rearing is 7.79 times GDP per capita.
How much does it cost to give birth in the USA without insurance? ›
Average costs of delivering a baby in the US
| Baby delivery medical procedures in the US | Average cost - without insurance (USD) |
|---|
| Prenatal ultrasound | $200- $300 |
| Birth and delivery in the hospital | $3,000 - $37,000 |
| Cesarean section in the hospital | $8,000 - $71,000 |
| Home birth and delivery with midwife | $1,500 - $5,000 |
1 more rowThe annual cost of raising a child increases as the child gets older. Factors include higher food costs for teenagers and added transportation costs due to additional car insurance premiums or an additional vehicle purchase. Here's how much it costs per year to raise a child, based on their age.
The typical American picture of a family with 2.5 kids might not be as relevant as it once was: In 2023, there was an average of 1.94 children under 18 per family in the United States. This is a decrease from 2.33 children under 18 per family in 1960.
What is the biggest cost of being a parent? ›
The greatest expense associated with raising a child is housing.
How much money do you need to have a kid? ›
There's no question that it's expensive to have kids. A recent figure from LendingTree puts the average cost of raising one (1) child in the U.S. at around $240,000, from birth to their 18th birthday. In Canada, the average is a little higher, with estimates at around $350,000 CAD for kids up to 17 years old.
What is the average cost of raising a child in America? ›
Raising a child from birth to age 18 now costs an average of $237,482, according to LendingTree.
How much money do you save not having kids? ›
Among all households, the Federal Reserve's Survey of Consumer Finances found that couples with no children also have the highest net worth, despite earning less than households with children. In 2022, the median net worth of couples with no children was around $150,000 more than that of couples with children.
How much do diapers cost per month? ›
Disposable diapers: On average, disposable diapers cost between $0.20 and $0.30 per diaper. This means that if you use 10 diapers per day, you can expect to spend between $60 and $90 per month on diapers.
What is the most expensive place to raise a child? ›
San Francisco is the most expensive city in the U.S. to raise a child—it costs $15,000 more than average. It's expensive to live in San Francisco — and even more costly to raise your kids there.
What is the most expensive state to have a baby in? ›
According to the analysis, Massachusetts is the most expensive state in which to have a baby, with the total cost coming to $34,689… The biggest portion of baby-related costs in Massachusetts comes from the average yearly cost of childcare for a year, which the report says is $20,913 per year.
Which state has the most expensive child support? ›
Chart Toppers for Child Support Payments
The state with the highest median child support payment was Massachusetts, with a median payment of $1,187 per month.
What is the most affordable state to raise a family? ›
The most and least expensive places to raise kids
Two other states in the South -- Alabama and Arkansas -- follow Mississippi closely in being the cheapest places to parent in the U.S, with an average cost of $16,192 and $16,284, respectively.
