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Study: The cost to raise a child has increased 35% since 2023

In the most expensive states — Hawaii, Massachusetts and Washington — raising a single child can cost families between $32,000 and $36,000 per year.

In the most expensive states — Hawaii, Massachusetts and Washington — raising a single child can cost families between $32,000 and $36,000 per year. (Scripps News)

By: Dan Grossman

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Jason and Sammy Diniz are eagerly preparing to welcome their first child, a journey filled with excitement and questions — primarily about the financial impact of adding another member to their family.

“I’ve been like two weeks ahead this whole time, so I feel like I’m ready now. Let’s do it,” Sammy said with a laugh.

As the couple anticipates the arrival, they are acutely aware of the responsibilities that come with parenthood, especially the financial ones.

“I remember when she told me, ‘Hey, we’re pregnant.’ It’s a really exciting moment, and then you’re like, ‘OK, nine months,’” Jason explained. “You know, number figures. We want a nest egg; we want an emergency fund. Now that we have a kid, where do we feel comfortable with that getting to?”

A recent study by LendingTree has brought new light to these concerns. The study revealed that the annual cost of raising a child has increased 35% since 2023, with the total cost heavily influenced by geographic location. In the most expensive states — Hawaii, Massachusetts and Washington — raising a single child can cost families between $32,000 and $36,000 per year. In contrast, families in Mississippi, South Carolina and Alabama face much lower expenses, with costs ranging from $16,000 to $18,000 annually.

The study also identified childcare as the largest contributor to the rising costs, adding an average of $6,000 to family expenses each year.

“If you have two earners and you’re only getting to a middle-class income by having two earners, then you’ve got to have childcare in your cost calculations,” said Isabelle Sawhill, a senior fellow emeritus with the Brookings Institution.

Sawhill noted that rising costs play a significant role in declining birth rates, which the Centers for Disease Control and Prevention report are at historic lows. Birth rates have decreased by 2% annually from 2014 to 2020, with a notable 3% decline in 2022.

Despite the financial concerns facing many prospective parents, Jason and Sammy are excited to welcome a baby.

“It’s not perfect, right? I don’t think you’re ever going to feel like you’re checking every single box, but you kind of get to a spot where you’re like, ‘Alright, I don’t think we’re going to fail, so let’s move forward,’” Jason said.

According to research from the Pew Research Center, the rising costs of children — especially childcare — are prompting more families to consider having a stay-at-home parent. The findings also reveal that 62% of Americans believe being a parent is somewhat harder than expected.

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