September 1, 2013

Motherlode: Costs of raising children depend on income

By KJ DELL-ANTONIA

The annual U.S. Department of Agriculture numbers on the cost of raising a child are out for children born in 2012. (I love that it's the Agriculture Department, which suggests that we raise children like we do cattle.)

Not surprisingly, nearly everything has gone up: parents of children born in 2012 are projected to spend more on child care, education, health care and clothing than parents of kids born in 2011, with an estimated total of $241,080 ($301,970 adjusted for projected inflation) for middle-income families in two-parent households.

That "middle-income, two-parent" descriptor is an important distinction. The "cost" of raising a child varies significantly depending upon family income:

A family earning less than $60,640 per year can expect to spend a total of $173,490 (in 2012 dollars) on a child from birth through high school. Middle-income parents with an income between $60,640 and $105,000 can expect to spend $241,080; and a family earning more than $105,000 can expect to spend $399,780.

In other words, this isn't really a report on the cost of raising a child. It's a report on what we spend and what we don't.

The Agriculture Department recognizes this (the formal title of the report is "Expenditures on Children by Families").

But informally, and in much of the media coverage, it's all "What Does It Cost to Raise a Child?" As though those numbers were set, and we parents were passive in the process. A television costs what it costs. We choose whether to spend our money on it.

But whether we really have that choice depends on whether we have the price of the television in our wallets, and that's why referring to this data as the "cost" of raising a child glosses over what it really measures: not just how much our children cost, but how differently we're able to spend on them.

The department's calculator suggests that a parent in a two-parent household with an annual income over $106,640, living in an urban area in the Northeast, will spend about $19,000 a year on each child.

A single parent with an income under $60,640 is expected to spend about $7,000 annually per kid ( a number that doesn't change based on geography).

That's an enormous difference. What does that extra $12,000 ($204,000 over 17 years) do for a child?

Higher income parents spend more on nearly every item with a discretionary component. That adds up to Montessori instead of in-home day care; houses in stronger school districts; and more money spent on activities, travel and other miscellany that the lower-income child either doesn't "need" or just doesn't get.

For children born in 1996, parents in the highest income category were expected to spend about twice as much on their children as parents in the lowest. For children born in 2012, parents in that highest income category will spend about 2.7 times as much as low-income parents.

As income inequality has increased, so have the disparities between children who have, and those who have less.

How much does that extra expenditure matter? It doesn't have to mean a thing. More than one successful, happy adult was raised under tight financial circumstances.

But when you look at the forest, rather than at the trees, financial statistics like these do reflect different outcomes for the children whose experiences they shape: true economic mobility is becoming more a pipe dream than the American Dream, and children are likely to stay within the income category to which they are born.

This annual report does tell us something about the "cost of raising a child."

It tells us a lot more about the differences in the resources expended to raise all of our children. And that's data that deserves a different kind of attention.

Contact KJ Dell-Antonia at:

kj.dellantonia@nytimes.com

 

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