Saturday, January 6, 2007

The Cost of Having Kids


A number of my wonderful friends are thinking of having kids.  To the last, all would make amazing parents.  To the last, all have a variety of concerns about what it means to have kids.  Some are gay, some have health problems, some are just weighing all the options.

And all have mentioned the cost of having kids.  In the past, I've kind of pooh-poohed this.  My opinion was, if you're ready to have kids, just go for it.  Don't let money get in your way.  In other words, if most of us waited to have kids until we'd saved up enough money to support them, not too many of us would be having kids.  That was certainly our experience--having kids has been forcing us to get some other financial ducks in a row, but we certainly haven't been bankrupted by them.

Or have we?  I was curious to find out just how much having kids is costing us.  Because we keep really detailed records of our expenditures every month, I went back over the last year's records to check this out.  A couple of things became really clear.  First, these numbers are very context-specific.  In other words, your numbers will vary based on how many people are parenting, where you're located, whether one, two, or three of the parents decide to work, and so on.  I've tried to be specific about our particulars to give you a sense of the variables.

Second, kids cost money, even when you do things on the cheap.  Being middle class with at least two incomes is the only way we could swing it.  The money we spend on daycare alone could probably get us out of debt in two years.   

The numbers below are pretty accurate because of our record-keeping, but where it made sense to do so, I rounded off to the nearest hundred.  So, here is what we've got:

1.  Daycare.  No surprise here:  This is far and a way the biggest expense we have, one that has doubled since Nolie's arrival in August.  Next year's number will be even higher because we'll pay daycare for both kids for every month of the year, and Addie is in preschool now, which is more expensive than a home daycare (where Nolie currently is). 

Note:  my schedule is flexible, and Eric's work allows him every other Friday off.  As a result, both kids are in daycare only three full days a week (sometimes less).  So this number includes 20-25 hours a week for both kids because I work evenings and odd weekend hours.  It also includes the cost for gym daycare (back when I was going to the gym), gratuities for our daycare provider, and the occasional night out, which was almost never--we're homebodies, for the most part.  Finally, we have limited friends/family to use as babysitting resources--most of Eric's family is in San Diego, mine's in Idaho.  So we don't get much free daycare that other folks might get if they live near grandparents, for example.

Total:  $5400

2.  Groceries.  This one is harder to calculate, because we didn't keep track of what exact expenses were for Addie and Nolie, and which were ours.  However, on average, we spent $1100 a month average on groceries.  Before you get all indignant at that number, let me tell you that we are now down to $800 a month because of some lifestyle changes we've made.  But $1100 was the number for most of 2006.  My guess is that out of that, approximately $200 a month went to stuff for the kids (diapers, food, baby wash, etc.).  I breastfed both babies until around 6 months, so that saved a lot on formula, which is ridiculously expensive (especially when your kids are lactose intolerant and have to drink soy formula.  Argh).

Total:  $2400

3.  Medical copays.  We are members of the lucky club of Americans who actually have health insurance, and we belong to an HMO, so we're primarily on the copay system.  This number is what it is because of a couple of trips to the E.R. for Addie, an ambulance ride, and Nolie's birth.  Then, all the little doctor visits over time added up.  So, we had very reasonable copays, but they accumulated over time.

Total:  $1400

4.  Clothing:  My kids are rarely dressed in designer duds.  They puke and poop all over everything anyway, so why bother?  In fact, almost everything either one of them wears is a hand-me-down, a gift, or from the thrift store.  The one thing I do spend money on is shoes, because Addie is very picky about what she'll keep on her feet, and she'll wear one pair until they are falling apart.  Another note:  Nolie is a girl.  That means that she is now wearing all of Addie's baby clothes.  If she had been a boy, he probably couldn't have worn all of Addie's hand-me-downs (even though boys look cute in pink), and our clothing costs no doubt would have increased.  The number below is mostly maternity clothes for me.  I had Addie in spring and Nolie in the heat of the summer, so not all of my old maternity clothes translated to the new pregnancy. 

Total:  $600

5.  Entertainment:  This number includes eating out (we now have to pay for Addie to take one bit of something and decide she doesn't like it in a restaurant), trips to the zoo or museums, memberships, and so on.  Granted, we probably would have spent entertainment money on something else if we didn't have kids, but I'm trying to be thorough here.  I'm sure there are ways to reduce this cost (don't eat out, don't go out).  But if you never take your kid to the zoo or for ice cream, why are you a parent?

Total:  $650

6.  Travel:  We took Addie to San Diego once to see Eric's parents, and to Idaho twice.  She's now over the age of two, so we pay for her plane ticket.  My family does offer to help out with tickets when we come, but even with that, we paid almost a grand to fly her to see her family.  I don't know what in hell we'll do once Nolie turns two and we have to pay for her ticket.  Hide in our basement for the rest of our lives, I guess.

Total:  $800

7.  College Savings:  We put $50 a month in a pre-tax account for Addie's college, and set up one for Nolie in November.  One of her grandparents also has an account saved up for her.

Total:  $700

8.  Gear:  We probably paid out for a lot more stuff when Addie was born, but I saved all that stuff, so we didn't have to buy much for Nolie's arrival.  Still, we did need a double stroller, some humidifiers, and a truckload of stuff for potty training.  We bought most of this used from Craig's List.  I think gear is not something new parents need to worry too much about--you'll get a lot as gifts or hand-me-downs, or can procure quality stuff used pretty easily.  And a lot of the crap they try to sell you as new parents you don't really need (of course, you probably won't know this until you're done having kids).

Total:  $240

9.  Haircuts:  Addie's hair grows incredibly slowly, so we don't get it cut often.  When we do, we go to Supercuts.

Total:  $50

10.  Birthday parties/gifts and Christmas:  We keep Addie pretty well hidden away, but she's still managed to make a few friends and get invited to a few parties.  And she had one birthday of her own (we only bought her one gift, by the way.  We figured she'd get plenty of stuff from her grandparents, and she did.  Same with Christmas).  Still, we spent some cash on gifts for other kids and on things like new Christmas stockings.

Total:  $125

11.  Having Nolie:  The $100 copay for her birth is factored into the health insurance number above, but we also paid to have a doula (a birthing assistant) at Nolie's birth, which was money very well spent (Nolie shot out so fast the doula practically had to catch her).  I also needed some medications and other aids when pregnant and in the weeks postpartum.  These were luxuries but made that whole wretched experience more pleasant.  The cost of a doula in my area is $400-800, but varies depending on where you live.

Total:  $900


So, how much did having two kids (one only since August) cost us this year?

Grand Total:  $13,265.  Holy God.  About 20% of our take-home pay.

Can you do it for cheaper?  Probably (we probably could have).  Maybe you wouldn't have a doula at your birth, or don't need to travel to see family.  Maybe you live in a part of the country where things don't cost quite so much.

But maybe you couldn't do it cheaper.  Maybe your kid will have to be in daycare 5 days a week.  Maybe he or she will have health problems our kid didn't have, God forbid.  Maybe you will decide your kid has to be dressed in fancy new clothes.  I don't know.

And I'm sure there are things I'm not considering.  I'm sure there is a tax benefit to having kids--because I own a small business, I can write off daycare expenses, and you get a tax credit for every child you have.  So you should factor that into your calculations.  I also want to be clear that I recognize our enormous privilege here:  we both have jobs we love that pay us decent (though not excessive) wages; we have health coverage; we have 401ks.  We have some debt, but on the whole we're in pretty good shape financially.

Of course (necessary disclaimer here), my kids are not quantifiable, not reducible to numbers.  The joy and depth they bring to my life is incalculable, so this post is really just an exercise, something to notice and be aware of.  I suppose that's what I would tell my friends who want kids, now, if they make enough and have some left over:  yes, do it.  It will make your life so rich.  But it will definitely make your pocketbook poorer.


  1. I'm afraid to add up what we spend on our kids... With four, we've taken to driving pretty much everywhere we go -- even if that means two days in the car broken up by a night in a hotel.

  2. I agree with your numbers, and your conclusions, but wanted to point out that (for us, at least) there are a fair number of expenses that got reduced or disappeared entirely as we had kids. We ate out less frequently after our first, and now that we have three almost never. We travel less than we used to. We certainly see far fewer movies. You get the point. Even so, this probably amounts to just a few thousand a year, a small portion of your computation.

  3. Totally true--an excellent point.

  4. dad,

    I can't imagine! You're my new hero. Just the thought of trekking cross country with two cranky kids under three gives me the hives. My husband thinks it sounds like fun. But it may be what we have to do once Nolie turns two...yikes!