Between feeding and nappies and sleep deprivation, your budget is probably the last thing on your mind in those first few weeks when you bring your bundle of joy home from the hospital and settle into life as a new family.
There’s no doubt our children bring us joy; enrich our lives; and test us in equal measure, but according to the latest economic data, the costs of raising children are rising much faster than our wages, which means setting a budget and being realistic about our spending is essential.
Raising two children from birth to adulthood for a typical middle income family is $812,000, according to figures from the NATSEM (University of Canberra) Income and Wealth Report. Lower income families spend $474,000 to raise two children, while higher income families spend $1,097,000, according to the report1.
These figures have risen by 50 per cent since 2007, in comparison to our household incomes which have only risen by about 25 per cent in the same time period1.
And if you think your budget will get easier to manage as your children grow, don’t get too comfortable, because children cost more as they get older, according to the report.
An average middle income family will spend $133 a week per child from birth to four, $198 on a child between five and 9, $228 for a 10 to 14 year-old child, $414 a week on a 15 to 17 year old and $678 a week on a child from 18 to 241.
And the reason parents continue to spend on their children after they turn 18, rising property and higher education costs mean children are staying in the family home longer2.