Graduated Learning: Life after College

Personal Finance, Parenting, and a dash of Science

The Cost of Having Children April 7, 2019

Filed under: baby,Personal Finance — Stephanie @ 8:45 pm
Tags: , ,

Every once in a while I come across an article talking about the cost of having children. Many posts try to advise you on ways to save.

Get clothes second-hand!

Use cloth diapers!

Don’t buy many toys! Just give them a cardboard box to play with!

I get it. We try to save on lots of kid expenses, too.

We’re fortunate to have very generous family and friends who love spoiling the kids with lots of new clothes, books, and toys. And especially with our second kid, we’ve gotten lots of hand me downs from his older cousin. We go to the library a lot, too, to find new books to read.

But when it comes to having kids, there are so many other costs to consider.

I’ve discussed before how we’ve decided to send our kids to daycare full-time while my husband and I both work. Overall, we still come out ahead, but this year alone we’ll be spending over $45k for our two kids to be in daycare. We’re lucky that we both have well-paying jobs that make this the more obvious choice for us. So many parents have a much harder time coming to a decision of how they’ll deal with child care, if they find the cost of childcare too overwhelming. Stay at home parent? Alternating shifts so someone is always home with the kids? Having grandparent or other relatives help out? A combination of every option?

On top of that, let’s add medical costs: Add in the costs of labor and delivery (and prenatal care that may not be part of your health insurance plans) plus the kid’s medical needs and health insurance premiums.

You’ve got to keep them fed! Starting out with formula and/or breastfeeding (which is only “free” if you consider the nursing/pumping mother’s time to be worthless) then healthy foods as the kids get older. (Though luckily there are programs like SNAP and WIC for lower-income folks to at least help keep them fed).

Some people can still live in the same place that they did before they have kids, but many families find they need to move after having kids, either due to lack of room, to be in a safer neighborhood or better school district, or need to be closer to work/daycare to make sure they’re spending less time commuting and more time with their kids.

And even if you get hand me down or second-hand items for clothes, books, toys, furniture, etc. you still will need to buy some items new: car seats and other safety gear are not something to take a chance on used. It’s possible the car seat has been recalled, and even if it hasn’t been, car seats have a finite life due to degradation of the plastic and other components over time.

Last year, I sparked quite an interesting conversation with this tweet:

I got so many responses, some sharing that their careers shifted significantly after kids, some for better, some for worse. Others said having kids had no impact on their careers. Alyssa at Mixed Up Money wrote a whole blog post inspired by my question.

And then Bridget chimed in with her own experience, and I felt that her response aligned closely with what I wanted to say. While she is a single mom and I’m married, we still had similar experiences of having to opt out of longer hours, business trips, networking opportunities, etc just because it’s so hard to navigate the childcare situation (and the utter exhaustion of parenting). While I’m able to trade-off on daycare drop offs and pickups, it’s more difficult when my husband has his own business trips and meetings to attend as well.

So, add to this discussion the idea of opportunity cost: are you working less, missing out on potential promotions and career paths due to having kids? You may be completely fine with this, but it’s something else to consider.  Right now, I’m working part-time with flexible hours, which really helps with my work life balance, but also means I can’t always get as much done as my colleagues can.  And I took 12 weeks of partially paid maternity leave for both babies.  So overall this means less time at work, less money earned, and potentially fewer growth opportunities.

I’m not trying to be negative about all this, or try to convince anyone not to have kids. I absolutely adore my kids, and all of these “costs” are totally worth it for me. If people want to have kids, they should!

But I get tired of people claiming that kids are cheap because they don’t buy a lot of “stuff” for them. Or fail to include the costs of childcare (or dropping out of the workforce to care for the kids full-time). And like I talked about in my latte factor post, the big expenses like healthcare and housing are still unavoidable and going up.

Kids are only inexpensive if you don’t include all of the expensive things.

I realize how much of my observations may come from a place of privilege: we make good money so daycare (even at high prices) makes obvious sense. And some families have no choice but to make certain difficult decisions about kids, childcare, housing, and other things because they don’t have the financial wiggle room that we do.  And I know people have found so many creative ways to make it work, and I’m glad that they have.  But it’s not always easy.

Also, my observations are based on the United States, where certain policies (or lack thereof) for (paid) parental leave, healthcare, and childcare have a big impact compared to other countries with a much more comprehensive safety net.

Society needs people to have kids.  They’re our future teachers, healthcare workers, mechanics, leaders, scientists, cooks, and cleaners. And our future taxpayers. Hopefully some reforms will come that make having kids less of a financial burden for so many people.

How have having kids impacted you financially?  What changes have you made to make it all work?


3 Responses to “The Cost of Having Children”

  1. There’s a show on Netflix called Explained. It’s a partnership with Vox media. It’s a very deep breakdown into a bunch of topics. One of them is the gender pay gap. The thing that I found most surprising is that it’s not really about gender, but about the parent that takes care of the kids due to all the missed opportunities and things you mentioned in this article.

    Typically that parent is the mother, so it makes sense. However, it’s interesting to square with my own experience. I could have gone back to a six figure software engineering job, but taking less money for kid flexibility is a better option for us. I’ve personally seen a parenting gap in income, but I’d like to see some statistics on how it goes when the father is the primary contact on all the kid stuff.

    I don’t think our healthcare went up much, but it’s my wife’s military health care, so it’s a special case that doesn’t apply to most people. Our house (1800 sq. feet) is probably what we’d live in anyway. Childcare is expensive and it effectively drove us out of Silicon Valley ($30K per kid doesn’t work on a blogger salary). We ended up in a place with a highly subsidized, exclusive private school, so it’s money that we choose to spend. We can always “undo” that choice if we wanted to spend less.

    All the other stuff does get to be cheap depending on your shopping options. A WalMart and an Aldi makes food and clothing really cheap. A Dollar Tree can keep a kid happy for awhile. These aren’t the big expenses as you mentioned.

    One more thought on the article, with breastfeeding you have to include the cost of eating more yourself (well the mother eating more). So it’s not just the time being valued at zero.

    In the end, the costs can be all over the map and everyone’s situation is different. Not only that, but regions of the United States are so vastly different, they might as well be different countries when it comes to costs. What makes it especially difficult is that some of the costs are hidden as opportunity costs. It’s hard to quantify what those are.


  2. […] And then we talk about how much we love our beautiful house. How much we love living close to our families. How we both want to have children, which will undoubtedly affect our lifestyle and priorities for the future. (Stephanie from Graduated Learning outlines some considerations for opportunity costs when having children here.) […]


  3. Julia Says:

    I agree with what you concluded. I always planned to work less or fully stay at home with my kids and that is what I’m doing. So yes, we no longer have my salary (which was pretty close to my husband’s).
    However I find it interesting to think about the cost of working- unrelated to childcare. In my case, I was commuting 40 miles each way so our costs on gas and car maintenance have decreased a lot since I quit. I also have the chance now to cook at least 90% of our meals, saving money on take out, etc. which can be tempting when you’re exhausted from work. Not that being a SAHM isn’t tiring sometimes 🙂
    These savings do not equal my salary, not even close. But, I think they are important to consider.

    Liked by 1 person

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