…
Inflation has skyrocketed food and gasoline prices, which means it has become more expensive for people to raise a child.
The cost of raising a child
The Brookings Institution made an estimate for the Brookings Institution for the Wall Street Journal, which determined that couples with two children should spend more than $ 300,000.
The estimated amount is to raise a child born in 2015 through high school.
The cost is a significant increase from Brookings’ estimated $ 26,000 two years ago, an increase of over 9%.
The calculation is based on a number of expenses that have risen, including housing, food, clothing, education, and childcare.
Read also: Why Moving in With Your Partner Is Essential Before Marriage
Previous estimates
According to Isabel Sawhill, a researcher in economic studies at the Brookings Institution, the $310,605 price tag comes from the U.S. Department of Agriculture’s education cost estimate.
In 2017, the USDA lowered the cost of raising a baby born in 2015 to about $ 233,610.
The cost is a significant increase from Brookings’ estimated $ 26,000 two years ago, an increase of over 9%.
“A lot of people are going to think twice before they have either a first child or a subsequent child because everything is more,” said Sawhill.
“You may also feel like you have to work more.”
“It’s kind of a wake up call to parents. It tells them you better think hard before you have a child or another child, because it’s going to have a major impact on your pocketbook,” she added.
“You’re going to have to make trade-offs in terms of what else you spend your money on, or on how much you work.”
Inflation
The sharp rise can be attributed to historically high inflation, which was a thorn in Americans’ side last year.
Sawhill says inflation estimates were based on what happened the last time inflation rose to the same level in the late 1970s and early 1980s.
As a result, rising costs disrupted household savings in cash and unemployment benefits at the start of the pandemic.
As the country has seen inflation slow, Brookings researchers have discovered its effect on the economy over the past year by increasing the cost of parenting.
Earlier this year, inflation peaked in 41 years, leaving households indebted to credit cards and dependent on food banks due to rising costs of food, gas and housing.
“It’s particularly important for lower income families because the cost of raising a child, although it varies with your family income or socioeconomic status, it doesn’t vary that much,” said Sawhill.
“The cost of raising a child is going to be a much larger proportion of the budget of a lower income family than a higher income family.”
Estimates for adulthood
Brookings estimates only cover a child’s upbringing during high school; it does not include the price tag that strikes families when children are adults.
“So if you’re a parent and you expect or want your child to go to college, then you really need to add quite a lot more to that estimate,” warned Sawhill.
Sawhill noted that it remains to be seen whether the country will see more government support for higher education in a decade or how tuition fees might change.
Read also: Time Management Tips for Working Professionals
Generation Z and millennials on having children
Last November, a Pew Research Center study found that adults in the United States have decided not to have children.
44% of non-parents said they will not have children in the future, a 7% increase from 2018.
74% of parents between 18 and 50 also said they would no longer have children.
More than a quarter of young parents who are not expecting children attribute their decision to economic reasons.
Millennials have already chosen not to pursue parenthood, citing climate change and economic uncertainty.
Others have also revealed that they want to focus on their careers, avoid the high costs of parenting and maintain their independence.
“I’ve often said it’s probably the most important decision you ever make, with the possible exception of who you select as a partner or who you marry,” said Sawhill.
“Those two really huge long-term decisions that are gonna affect your life for quite a while.”
“Between the two, you can divorce a spouse. You can never divorce a child. They’re going to be part of your life forever.”
References:
