You had better take out that piggy bank and start saving. Parents are expected to spend $245,340 to raise a child born in 2013, according to a report by the U.S. Department of Agriculture (USDA).
The "Expenditures on Children and Families" annual report, also known as the "Cost of Raising a Child," showed that a middle-income family with a child born in 2013 can expect to spend almost $250,000 on food, housing, child care, education and other child-rearing expenses up to age 18. The report indicated that costs associated with pregnancy or expenses inccurred after age 18, such as college, are not included.
The report also showed the total expense rose 1.8 percent over the previous year, with lower costs in the urban South and rural regions of the U.S. The cost is highest in the urban Northeast, with parents spending about $282,480 on their children.
"In today's economy, it's important to be prepared with as much information as possible when planning for the future," USDA food, nutrition and consumer services under secretary Kevin Concannon said in a news release. "In addition to giving families with children an indication of expenses they might want to be prepared for, the report is a critical resource for state governments in determining child support guidelines and foster care payments."
The annual report is based on data from the federal government's "Consumer Expenditure Survey." According to the survey, "in 2013 the annual child-rearing expenses per child for a middle-income, two-parent family ranged from $12,800 to $14,970, depending on the age of the child." For middle-income families, housing was the largest expense, averaging 30 percent of the total cost. Childcare and education was the second-largest expense at 18 percent, followed by food at 16 percent.
The report also found expenses per child decrease as a family has more children -- "families with three or more children spend 22 percent less per child than families with two children." The reason? The report stated: "As families have more children, the children can share bedrooms, clothing and toys can be handed down to younger children, food can be purchased in larger and more economical quantities and private schools or child care centers may offer sibling discounts."