Should We Have Kids or Not? It’s Incredibly Expensive to Raise a Child.

Are Kids Too Expenisve? Two baby hands counting fingers.

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If you think that Kids are Expensive …. You’re right. Have you heard the government statistics about the cost of raising a child?

We raised 5 kids and spent less than 60% of what the government experts estimated. Learn how.

Kerri’s story: How one reader grew up and was taught to manage money.

Question About the Cost of Having Kids: When I graduated from high school, I paid for my own auto insurance, graduation gown, and class ring.

My grandmother paid for my class picture. My graduation gift from my parents was a cell phone with a very limited plan because it was on my dad’s two-year contract. After that, I got my own cell phone contract.

My husband and I just got married a few months ago, we heard on the news that raising a child from birth to 18 will cost you 240,000! We are thinking twice about having a child.

We both work, and are trying to manage our bills and we still have a mortgage to pay off.

What do you think we should do?

Is it really too expensive to have and raise kids?

Kerri, thanks for sharing your story. Your parents sound like they were very smart when it came to teaching you financial responsibility. They taught you to be independent financially, and that’s always a good thing.

But we hear and understand your concerns about counting the cost of having children. Here are four things you can do to keep the cost of raising kids from getting out of control.

1. Don’t Believe What the Government Says it Will Cost You to Raise Kids!

We know the government says it will cost more than $250,000 to raise a child, but we found their numbers to be less than accurate.

They base their estimate on a specific number of square feet in a house, cubic feet in a car, health care, clothes (purchased retail), groceries, activities, daycare, school expenses, technology, and a few other things . . . per child.

Not only is it impossible to be accurate due to differences in costs based on the city/state where you live, but it’s also impossible to be accurate because of lifestyle and spending differences.

These experts don’t consider the savings achieved through hand-me-downs, the economy of scale when cooking larger meals or that every child does not necessarily need to have their own bedroom.

2. Do Believe that Kids CAN be Raised in a Frugal and Fun Home

We raised 5 kids and spent 75% less than the government “experts” predicted. Spending less didn’t mean having less. But spending less money did mean that we needed to spend more time teaching, training, and communicating with our kids.

Frugal living is fun and our kids quickly caught our vision because we encouraged them to spend money they earned to buy the things they wanted. And the money they earned was more in line with their age, maturity, and ability than most experts say kids need.

3. Allowances Don’t Teach Kids Anything Except to Expect Something for Nothing

We decided early on that we would never give our kids an allowance. Paying a child for just being a part of our family simply sounded too much like an entitlement program.

But that idea was modified when we discovered that for kids to become financially independent, they needed experience working, earning, saving, and spending their own money.

What We Decided to do About Allowance for Our Kids

So we decided to take some of the money we would normally be spending on our kids for clothes and activities and created a way for our kids to earn that money. We discovered that this mindset of training our kids to earn money from us turned into a tool that helped them become MoneySmart and financially independent. And we actually spent much LESS money raising them! We call the system the “MoneySmart Kids Financial Training System.

We wrote about the system we developed and how our kids responded in our book, The MoneySmart Family System – Teaching Financial Independence to Children of Every Age.

The book talks about every area of a child’s life: chores; clothes; recreation; technology and even teen issues such as:

  • part-time jobs
  • cars
  • friends
  • College

And we give parents super practical tools, tips, and advice for how to empower their children without creating an entitlement attitude.

4. How We Gave Our Kids the Gift of Financial Strength

MoneySmart parents choose to give their children the opportunity to work, earn, save and spend their own money, because parents know that this teaches them much more than just receiving a handout from mom and dad.

We developed a system that our kids called “Payday.” Every day they had the opportunity to earn points; at the end of the week, those points were converted into money.

They kept their money in cash envelopes: Give, Save and Spend and eventually Clothes (at age 11).

The money they earned was money that we would have normally spent on them, but instead, it was invested in them.

And the return on our investment was that they grew up to be financially independent and confident.

You can read about our MoneySmart Kids System on this page, and you can watch the two videos below.

Our Younger Kids and The MoneySmart Kids System

This video was shot when our youngest daughter was about 10 years old.

Our Older Kids and their Financial Independence

This video was shot when our youngest daughter was in college.

Helping kids to start paying their way and to allow them to struggle a little to figure things out is the best way to build financial strength.

So Kerri, to answer your question: You’re on the right track. Keep talking with your husband and paying off your mortgage, but don’t be afraid to talk about having children – they are an awesome investment, an incredible legacy, and a real joy in life!

Are Kids Too Expenisve? Two baby hands counting fingers.

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