On Monday, the USDA released a report estimating that the average middle-income family will spend $304,480 in inflation adjusted dollars (or $245,340 in today's dollars) to raise a child born in 2013 until the age of 18.
This projection takes into account costs for food, housing, childcare, education and other child-rearing costs. It does not consider the expenses parents incur prior to birth, such as pregnancy and delivery costs, or expenses accumulated after age 18, such as money spent on higher education.
Parents who plan on funding college can add an average of $18,390 per year for a public university education and $40,920 per year for private college.
According to the projections, the percentage of funds spent on each expenditure category remain the same, but an overall increase of 1.8 percent in child-rearing costs occurred versus the 2012 projection.
The study notes that there are large variations in projected costs by location based on the region of the country one lives in and where one lives within that region. For example, in the urban northeast, the average cost in non-inflation adjusted dollars jumps to $282,480 from the overall average of $245,340. In the urban south, the cost declines to $230,610, and in rural locations, like much of Morehouse Parish, it drops further to $193,590.
A large portion of the location-based changes can be attributed to the cost of housing. The overall cost of housing sits at an average of $73,260 according to the USDA data while the rural average is $45,180.
In a release, about the study, the USDA noted that the first year the report was produced was 1960. At that time, a middle-income family was projected to spend $25,230 on a child until age 18, which adjusts based on inflation to $198,560 in 2013 dollars. In both the current and first study, housing was the primary expense.
This annual survey provides the government with insight as well as providing potential parents with the tools they need to plan ahead.
"In today's economy, it's important to be prepared with as much information as possible when planning for the future," Kevin Concannon, USDA Food, Nutrition and Consumer Services Under Secretary, said. "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."
According to the USDA, the Expenditures on Children by Families report is compiled based on data from the federal government's Consumer Expenditure Survey.