Childbirth is a very emotional and beautiful sensation, but it has enormous expenses. Having knowledge of the costs can guide parents in planning and budgeting in advance. Let us analyze the cost to raise a child in the US per month, highlighting yearly and monthly averages, and see how to cut down on these expenses.
Yearly and Monthly Cost of Raising a Child
Current studies offer different estimates of raising a child’s cost:
- LendingTree Study (2021): The average cost to raise a child in the US per year was $21,681, a 19.3% increase from 2016.
- Investopedia (2025): The Brookings Institution reported that a study discovered the average middle-class family with two children will spend $310,605 to raise a child born in 2015 to age 17 in 2032.
These estimates show parents can, on average, spend $15,000 to f$21,000 annually per child, or about $1,250 to $1,750 a month.
Spending Breakdown
An understanding of how your money gets spent will be useful when planning the budget:
- Housing: This is normally the largest cost, gobbling about 32% of household earnings. A proportion of this spending includes house or apartment payments, taxes, insurance, and maintenance.
- Food: Household consumption of food consumes 15% to 24% of earnings, which increases with the number of members and the type of diet.
- Childcare: Childcare costs are very volatile, depending on the place and the child’s age. The cost ranged in 2022 from $5,357 for home-based school-age care in small counties to $17,171 for infant center-based care in large counties.
- Transportation: This is approximately 15% of the costs and consists of vehicle-related, fuel, and maintenance costs.
- Healthcare: Parents allocate roughly 9% of their incomes to children’s healthcare.
- Education (not college): Roughly 16% of the expense, including activities, school supplies, and other education costs.
Let us take a closer look at each category.
Housing: The Most Expensive (32%)
Housing grabs the biggest chunk of a family’s budget. A typical U.S. household spends roughly $25,436 annually on housing, including:
- Mortgage or rent
- Property taxes
- Home Insurance
- Utilities (electricity, water, internet)
- Repairs and maintenance
Why is housing so costly?
- Increased home prices and rents due to inflation
- Larger homes are needed for growing families.
- High demand in family-friendly neighborhoods
Tip: If you are struggling with housing costs, check out HUD’s housing assistance programs for low-income families.
Food Bills: Nourishing a Growing Child (15-24%)
Kids are always starving, and the cost of food just keeps on rising. The USDA puts a family of four’s food bill at:
Ways to save money on food:
- Meal planning to minimize waste
- Shopping in bulk (hello, Costco!)
- Home cooking instead of eating out
Child Care: More Than College? (7-23%)
You would not believe it, but child care is more expensive than state college tuition in some states! Here is what parents pay:
- Infant daycare center: $17,171 a year (in large counties)
- Home-based care: $5,357 a year (for school-age children in small counties)
Why is childcare so costly?
- High demand and low supply of daycare slots
- Higher compensation for childcare workers
- Infant full-time care is pricier than after-school care.
Tip: Look for sibling discounts or employer-sponsored childcare subsidies.
Healthcare: Keeping Kids Healthy (9%)
Children need regular doctor visits, immunizations, and the occasional emergency medical care. The typical family spends about
2,000–3,000 annually per child on:
- Health insurance premiums
- Copays and medications
- Dental and vision services
Tip: If the budget is tight, look to CHIP (Children’s Health Insurance Program), offering low-cost coverage for kids.
Education & Extracurriculars: The Hidden Costs
School does not come cheap—parents spend on:
- School supplies – (300–600 a year)
- Extracurricular activities – (100–500 per activity)
- Summer camps – (500–2,000 per session)
And then there is college. The average annual cost for 2024-2025 is:
- Public college (in-state): $24,920
- Private college: $58,600
Tip: Save early with a 529 Plan, a tax-advantaged college savings plan.
Regional Variations
Expenditure is extremely uneven geographically:
- Hawaii: In 2021, the lowest mean annual expenditure to sustain a young child was $30,506, the highest in the nation.
- Midwest and Rural Regions: Less expenditure for the majority of families in these regions, with some areas nearest to being 27% lower than urban
College Planning
Advance planning is required for college expenditures:
- Public College (In-State): The average yearly cost for the 2024-2025 year is $24,920, which includes tuition, fees, and room and board.
- Investopedia
- Private College: The same year has an average yearly cost of $58,600 for private colleges.
Cutting Costs
Raising children’s costs can be made possible by planning:
- Tax Credits and Deductions: Use tax savings available, such as the Child Tax Credit, to reduce your tax liability.
- Childcare Savings Plans: Sign up for plans like Dependent Care Flexible Spending Accounts (FSAs) to save money for childcare expenses.
- Education Savings: Start early with education savings plans, including 529 plans, to ease the financial burden of college expenses.
- Budgeting: Create a detailed budget that considers all child expenditures, enabling one to see where one can cut back.
Conclusion
Being a parent in America is a monetary burden, with an average spending of $15,000 to $21,000 a year or $1,250 to $1,750 per month. The cost varies based on a number of factors, including place, household size, and lifestyle. Being aware of these costs and budgeting in advance accordingly, parents will be best suited to deal with the financial aspect of bringing up the kids so that they can raise their children in a secure and nurturing environment.
