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Report Used to Set Child Support Guidelines: Cost of Kids Up 1%

The latest Expenditures on Children by Families report, the annual report that many courts and state legislatures use to establish child support guidelines was released on Wednesday by the USDA. The report, which analyzes data from 2009, estimates that the cost of raising a child is up an average of one percent.

The estimated cost of raising children varies by region and also by family income. For example, a family that earns less than $56,670 can expect to spend an inflation-adjusted total of $160,140 to raise a child from birth to age 17. A family with an income above $98,120 could expect to spend $369,360.

The one percent increase is the smallest increase in child-rearing costs this decade, which reflects the economy. The cost of raising a child is calculated by adding up the cost of food, clothing, housing, transportation, child care, health care, education and other necessities. According to the report, transportation expenses declined, which balanced out increases in child care, education and health care costs.

Annually, the average cost per child for a middle-income, two-parent family is between about $11,650 and $13,530, depending on the child's age. Single-parent families tend to have more expenses that may not be covered by child support.

Housing, Child Care and Education Costing More - Having More Children Brings Cost Per Kid Down

The cost per child decreases as a family has more children, according to the report. Families with three or more kids are able to spend about 22 percent less per child than those with only two children. The report suggests that the savings are likely due to things like use of hand-me-downs, buying food in bulk, and sibling discounts at child care centers and private schools.

Housing costs represent the largest expenditure when raising children, averaging about 31 percent of all money spent on raising a child to age 17. The cost of education and child care (for those who have those expenses) and the expense of food were the next largest.

The most expensive region in which to raise a child is the Northeast, followed by urban areas in the West and then urban areas in the Midwest. Families who live in the urban South or in rural areas tend to have the lowest expenses.

The cost has gone up substantially since the report was first done in 1960, although not as much as you might expect. When inflation is taken into account a middle-income family in 1960 would have spent about $182,860 to raise a child to age 17, while its 2009 counterpart would spend $222,360. Changes in society explain some of the increases. For instance, the cost of paid child care was negligible in 1960.

The estimates in the USDA reports do not reflect costs associated with pregnancy, or the growing cost of college education.

Related Resource:

"A Child Born in 2009 Will Cost $222,360 to Raise According to USDA Report" (USDA news release, June 9, 2010)

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