Raising Kids


The cost of raising a child is no joke! The average cost for a middle-income family to raise a child through age 17 is approximately $284,570 (including projected inflation of 2.2%), not including college. No one wants to assign a monetary value to a child, but let’s be honest, that’s the price of a home (or a down payment, depending on where you live). But before you start sweating, let us help break this down and figure out how you can best plan financially for your new bundle of 𝗆̶𝗈̶𝗇̶𝖾̶𝗒̶ joy. And guess what? The cost of raising a child goes down with each child you have! So have 4 (kidding!)!


Even though having a child upends your life a little (or a lot), the way you approach your finances doesn’t change. You should still aim to save 20% of your income, and you may have to cut back in other areas to make it all work. You’ll have more expenses to consider (diapers, child care, clothing) and you’ll have to adjust as your child gets older. The baby/toddler expenses will fall off, but they will be replaced by new ones (think sports/hobbies/activities, auto insurance). 

Reexamine your emergency fund to make sure you’re covered for 3-6 months at your new expense level each time you adjust your budget to account for your child’s costs.

Plan for College

If providing a college education to your children is important, this starts with a conversation with your partner. Make your priorities together- savings, retirement, college. Remember you can take a loan out for college, but not retirement. Discuss your intentions to fully or partially fund college, will you plan to cover public in-state tuition or private school? Will you cover tuition, books, fees, and room and board, or ask your child to help contribute to some of these costs? Once you have thought through this, you can develop a plan to save for college that is tax efficient and cost efficient.

Raise Financially Responsible Kids

In a world of crippling student debt, rising home costs, and disappearing pensions, it’s more important than ever that you teach your children basic financial literacy. You should take steps when they’re young to teach your children about money and the value of a dollar. 

Whether positively or negatively, parents are financial role models for their children. Taking steps to plan ahead and factoring cushion into your budget will help set you up for success, and in turn your children some day. It’s never too early to create a plan!

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