3 On Your Side: Expenses of Raising Kids
By Jim Donovan
PHILADELPHIA (CBS) – It’s fair to say the third in line to the British throne will grow up in world of privilege and that his parents won’t have to struggle to make ends meet. But for the rest of us welcoming a little bundle of joy means a big shift in the way a couple spends, saves, and plans for the future. 3 On Your Side consumer reporter Jim Donovan takes a look at the price tag.
The most recent government figures find the average cost of raising a child from infancy through young adulthood in the U.S. adds up to about $235,000. That’s not including college!
The added expenses begin immediately, from the car seat parents need to take a child from the hospital, to the crib where the baby will sleep.
The time to adjust a household budget, is before a baby’s arrival, especially if one parent will be taking time away from work for child care.
Reassess insurance needs. In addition to having health coverage for pregnancy and delivery, make sure a little one is covered from birth for visits to the pediatrician and prescriptions.
New parents may also consider disability or life insurance policies, to keep a family financially secure in the event of something unexpected. And estate planning is another must-do, a will or trust appointing a guardian if needed.
And start saving for college. The cost of college only keeps climbing. Starting a tuition fund now puts money in the bank that can also earn interest.
With that in mind, consider asking family and friends who’d like to give gifts upon a newborns arrival to skip the teddy bears, and instead contribute to an account.