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How
Much for the Baby?
Raising a
family can be an expensive undertaking. One survey found that families making
$65,800 or more a year will spend $250,000 to raise a child from birth through
age 17.1
Here are a few cost-cutting ideas to help parents manage family expenses and
prepare financially for their children’s future.
• The USDA estimates that housing represents about 35 percent of annual
child-related expenses. In the current low-interest-rate environment, you may be
able to reduce your family’s housing expenses by refinancing your home. As a
general rule, you might want to wait until the going mortgage rate is at least
one percentage point below your current rate to make the cost of refinancing
worthwhile.
• You might be able to trim food expenses by limiting the number of times your
family dines out. Warehouse clubs, wholesale food services, and shopping-related
Web sites can also help you develop well-balanced meals at bargain prices.
• Automobiles, repairs, fuel, and insurance can make transportation costs
formidable. To cut expenses, try purchasing slightly used cars that are still in
good condition. Also, shop around for the best insurance rates because they can
vary considerably from one provider to the next.
• New parents can easily reduce clothing costs for newborns and toddlers by
sharing clothes or purchasing them secondhand. As kids grow older, you might
suggest that they use money from babysitting or part-time jobs if they want to
buy designer-label clothing.
In today’s economy, supporting a family is no easy feat. Careful planning and
budgeting may help you manage financial worries so you can focus more on the
pleasures of parenting.
1) U.S. Dept. of
Agriculture survey, MSN Money, May 16, 2003
© 2003
Emerald Publications
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