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Costs of raising kids

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  • RogueDadMD
    replied
    I've got 2 kids and a third on the way.  There are times when my current two are driving me insane and I can't recommend anyone have ANY children.  Then the 2-year old does something that just blows me away, like using a toy hammer to put a ton of holes into the wall of the house we just moved into a few days prior, and that just reinforces my thought that the third one will be the death of me.  

    Having kids is an emotional decision, not a financial one, but finances should not be overlooked in the decisions.  Anyone in the ED/pediatric setting has met families with tons of kids where the parents have significant financial struggles in addition to other struggles, and you wonder how they are raising 4, 5, or 6 kids with little money and no education when I (as the physician) know how overwhelming it can be to just have 2.

    Everyone needs to be financially prepared to deal with the kids they do plan to have, even physicians with higher incomes.  Sometimes just having one kid may be the right answer, and sometimes people with 5 kids and less money handle the workload better than people with a lot of money and 1 or 2 kids.

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  • Hatton
    replied
    Test test

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  • The White Coat Investor
    replied
    test test

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  • The White Coat Investor
    replied
    Just doing a check on the notification system. Pay no attention.

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  • westcoaster
    replied
    I should also add, I think most high income groups don't think that you "stop" raising a child after age 18. Even if you're not paying for your child's college, certainly you are going to help out with any number of living and leisure expenses until they can land on their feet.

     

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  • westcoaster
    replied
    For those that like source literature: http://www.cnpp.usda.gov/sites/default/files/expenditures_on_children_by_families/crc2013.pdf

    USDA has been publishing this annually since the 1960s.

    Interesting that the big change was cost of childcare (now 18%, was 8% in the 80s).

     

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  • Carlos
    replied
    I have been learning this the hard way for the past few years... :?

    2 kids, 6 and 3 years old.  first, diapers, and baby food and when you finish these... then you get 12K/year daycare, etc... or now soccer, baseball, or even music classes... although, on the other hand. is totally worth it! 

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  • chrisCD
    replied




    Click to expand…


    (Or was I the only mean mom who expected that of her children?) And if you have family coverage health insurance, does it really cost extra for the 2nd child?
    Click to expand...


    You are not the only mean mom.  We gave them $$100 each for Fall and spring.  Anything else they needed to earn.  (we have six kids - we discovered Cable too late  :O) ).  They also have to buy their own car, although over the years we have had an extra that we have let them drive for a while.

    And these days, medical doesn't cost extra until after the 3rd child.  Adult children under 25 are separate, I believe.

    Although like most parents, I can not imagine a day without any of my kids, I sure would not recommend trying to raise 6.

    cd :O)

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  • conniebird
    replied
    I don't have kids but I do not know how you can make the same/more with children. Unless you take no time off.

    Throw in a complicated pregnancy (hyperemesis, bed rest) and you lose even more. Also, priorities change when you have a family ( I hope).

     

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  • YSH
    replied
    I wonder if they factored in the lost of income from each parent, who instead of generating more revenue from working, now devotes that human capital towards their kids.  I think it is well known and widely documented that women who chose to forgo childbearing have higher income and upward movement of career than those who don't.

    What do you guys think?  Did having children change your career trajectory? Do you think there are opportunity cost to having kids? What would you have done differently?  I would be curious to know what the financially savvy minds of WCI forum think.

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  • The White Coat Investor
    replied
    A lot of that stuff is a choice. You can spend a million bucks just educating each child if you want. Some of it is more hidden, like the extra costs of living in a larger house or having to have a house in a nice school district.

    Obviously it can't cost $400K to raise every child. Take a middle class income household with 4 kids. $50K a year x 20 years = $1M in income. Yet they spent $1.6M on the kids? I don't think so.

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  • Josh0731
    replied
    Expecting our first child soon. Not super-thrilled by this conversation  :?

    With a high income things like expensive baby/child paraphernalia hasn't really had much of an impact on finances so far. But I've surprised myself by already developing a nagging education anxiety that tells me I have to start squirrelling away $ for expensive private schools and colleges.  How necessary is that? How bad are the public schools in the middle-class suburb in which I live?  The public high school is behind my neighborhood!  I used to privately mock people with the exact anxieties to which I am now confessing!  What's happening?!

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  • VagabondMD
    replied




    No doubt raising children is expensive. But I’d wager that everyone with children is pleased with their return on investment. To The Gipper’s point, the # is academic. That number is useful for financial planning and being aware of what you signed up for (when you have children). But how do you quantify the happiness and satisfaction they provide? Factoring in the grandchildren, the care provided to you when you are old and frail, etc… it might just be the best investment you can make!
    Click to expand...


    Raising children is rewarding in many ways, and arguably an essential, innate component of the human experience, to propagate the population, etc. I would never call raising children an investment, though for some it may work out that way. Ask Serena and Venus Williams' father about that.

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  • canadianoutlaw
    replied
    No doubt raising children is expensive. But I'd wager that everyone with children is pleased with their return on investment. To The Gipper's point, the # is academic. That number is useful for financial planning and being aware of what you signed up for (when you have children). But how do you quantify the happiness and satisfaction they provide? Factoring in the grandchildren, the care provided to you when you are old and frail, etc... it might just be the best investment you can make!

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  • AlexxT
    replied
    For high income families, the basic costs, outside of school and childcare, are not very significant.  Buying all the stuff for kids: Crib, dresser, changing table, clothing, toys, etc came to a few thousand dollars at most, and most of that stuff can be re-used for subsequent children.  A lot of that equipment can be passed back and forth among friends.   So far, with 2 kids age 10 and 6, I have spent a total of $42,000, not counting childcare, and not counting most of the extra food expense.(per Quicken)

    The biggest expense is childcare and private schools.  The best childcare option we found was a daycare/pre-school that cost $2000 a month.   Because of the socialization and enrichment benefits, I found this to be a better option that having them at home with a parent or grandparent.

    We also send them to private schools.   This costs us about $15,000 a year per child, but some schools around here charge over 25k for kindergarten, and it goes up each year, with high school 47k and up for the most expensive schools, and those rates go up each year due to inflation. ( Note: I'm in one of the most expensive areas )

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