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It’s not a choice most middle-income American families are likely to make, but a new report from the U.S. Department of Agriculture (USDA) shows that costs to raise a child born last year to the age of 17 will amount to $235,000—enough to buy a brand-new Ferrari 458 Italia.
Adjusted to factor in projected inflation costs, the total expenditure climbs to $295,560 by the year 2028.
The USDA has issued the report each year since 1960, when a middle-income family could have expected to spend $25,230 ($191,720 in 2011 dollars) to raise a child to the age of 17.
The largest single expense is for housing, averaging $70,560 or 30 percent of total child-rearing expense over 17 years. Child care is the second largest expense, negligible back in 1960 but now accounting for 18 percent of total expense, likely due to more mothers working outside the home. Food is the third largest expense, accounting for 16 percent of total costs over the 17-year period.
Where families live has a bearing on total child-rearing expense. Families living in the urban Northeast spend the most, followed by those in the urban West and urban Midwest. Families in the rural South and rural areas have the lowest child-rearing expenses.
The report also found that expenses decrease as families have more children. For example, families with three or more children spend 22 percent less per child than families with families with two children residing in the household. The report suggests that this is due to children sharing bedrooms, using hand-me-down toys and clothing, parents buying food in larger and more economical quantities, and sibling discounts that may be offered at day care centers and private schools.
Want an estimate on how much it will cost your family to raise a child each year? Use the USDA Cost of Raising a Child Calculator.