If you are not one of those people anxiously awaiting the latest revision to the Pennsylvania support guidelines, you may be in a minority. We have no news to report on this subject except that the recommendations of the rules committee have been sent to the Supreme Court for their review and approval.
The Pennsylvania guidelines are based on models for child costs developed by the Center for Nutrition Policy and Promotion at the US Agriculture Department. That agency has just issued a report on its assessment of what it costs to raise a child in 21 century America. Here are the numbers in the raw:
For families with annual household The cost is estimated to be Per annum
Less than $57,000 159,870 8,882
57,000-98,000 221,190 12,288
98,000+ 366,660 20,370
The study, which involves monitoring expenditures of 5,000 families shows that there are economies of scale as families get larger. The average couple spends 27% on one child; 40% for two children and 47% for three. Costs tend to center on the first five years of childhood and during the consumer nightmare years of 15-17. Kids in elementary school up through middle school are more affordable. Curiously, this rule did not apply to folks in the lowest income bracket. Their expenses remained relatively flat throughout the child’s minority.
These numbers are averages. They assume no support obligation after high school so college is not part of the equation.
The breakouts are also of some interest. The study found that one-third of the cost of raising a child is spent on housing. Food comes in at about 16% and is closely followed by transportation costs of roughly 14%. Clothing consumes about 6% of the total cost and is overshadowed by healthcare which 7.8%. Day care and education are lumped together and consume another 16%. The final 8% is the dangerous “miscellaneous” category that probably includes, lessons, cell phones and itunes downloads.
For households with more than $98,000 the expenses are about the same except that education/day care jumps from 16 to 21%.
The numbers are premised upon the costs of a second child, not the first so they are tending to understate the real costs of Baby No. 1.
The report is available on line from the USDA. It is miscellaneous publication no. 1528-2008 and was issued in July, 2009. The data are drawn from surveys completed in 2005-06 but the expenditures were then adjusted based on changes in the Consumer Price Index (CPI).
Two other details to add to the pain are worth mentioning. The 2008 baby is estimated to cost just under $300,000 before he or she reaches high school graduation ($484,000 for the upper income bracket of $98,000+) and the urban northeastern states have costs that are almost 20% higher than the national average.
So how bad is this in a relative sense. The USDA has been tracking these types of expenditures since 1960. In real dollars (inflation adjusted) the child of today costs 18% more than the child of 50 years ago. Ironically, housing has almost nothing to do with this even though the house of today is far larger than it was a half century ago. The biggest change is in child care and education growing from 2% to 16% today. Health care is next. It has doubled in cost over time from 4% to 8%. Transportation clothing and food have all declined as a piece of the pie with the cost of feeding a child reduced by 1/3 and clothing costs cut almost in half (11% to 6%). But the miscellaneous costs have increased from 8% to 12% as the child of fifty years ago had to occupy himself with Lincoln logs, Barbie, bicycles and teen magazines.