Parenthood opens a new chapter in your life. It brings love, nappies, baby food, and sleepless nights. But along with these things, there’s yet another thing to be aware of- financial expense.
Businessinsider.com says the cost of caring for a child is $25.714. This figure is around 18.6% higher than in 2021, owing to the rise in food, daycare, and transportation expenses.
If you are planning to get hitched in 2024, and that involves adopting a baby of your would-be spouse, you better be careful. As a stepdad, there is a lot to take into consideration.
Apart from the wedding expenses, you must pay for the new additions to your family. Some expenses are known to all, while others are hidden. Read on to learn more.
The Hidden Cost of Parenthood
Hidden expenses often catch parents off guard. They usually shoot up quickly, taking a toll on their finances. Here are a few hidden expenses parents have to bear.
Housing Expenses
Two people can share a single-bedroom apartment. But the dynamics change entirely when children arrive in the family. There needs to be more than a single or double-bedroom apartment. It would help if you upgraded to a bigger apartment, which means more significant expenses.
Food
Do you know how much it costs to feed a child in the US? It’s around $1200 yearly, and the cost is rising. The price may increase due to several factors like diet and grocery budget. If you are one of those parents who prefer to eat out instead of cooking at home, your expenses will be higher than others.
Activities
It is not easy to be a doting parent. You have to devote a lot of time and money to kid activities. The average expense is around $360 per year.
Two factors play a significant role in this.
● Kind of activities where your child participates in
● Number of times your child participates in it
Medical Expenses
Kids love getting into trouble, and parents must face the consequences no matter how much they hate it. Sometimes, kids fight and hurt themselves. Sometimes, they break their hands while playing. Other than that, kids need regular medical checkups.
Your health insurance does not cover everything, so you must spend extra on out-of-pocket expenses. Moreover, your premium goes up whenever you add children to your health insurance.
Entertainment
Kids love vacations, toys, and gifts. Every time you visit a store with your kids, they ask you to buy them a toy, clothes, or gadgets. Plus, you have to accept them a hearty meal to keep a smile on their face. That’s an extra expense.
If you go on a vacation, buy extra air tickets and book bigger hotel rooms. Some parents even get into debt to cover these expenses. These are small expenses but often make a big hole in your pocket.
Sometimes, parents must resort to payday loans to cover these minor expenses. While payday loans are suitable for tackling these small expenses, they are costly. The interest rates vary between 300% and 500%. As such, several parents have to consolidate payday loans later on.
While payday loan consolidation programs effectively lower interest rates, they must be followed diligently. Parents must follow a budget and make the required monthly payments. Otherwise, they won’t get any financial relief.
Electronic gadgets
Laptops and tablets have become an integral part of the education system. But they are expensive and last only a short time. Before your child is old enough to pay his or her bills, you must buy dozens of gadgets, mobiles, and laptops annually. No one can predict the average cost. But be prepared to spend thousands of dollars on this.
Clothes
Children grow up fast. As such, parents are always in need of new baby clothes, leading to financial stress and anxiety. Children’s clothes are expensive. The average cost is around $290 per child.
Three factors that determine how much you have to spend on clothes are:
● Brands you choose
● Store
● Number of times you have to buy clothes
Traveling Cost
Unless your child’s school is adjacent to your home, you have to drive your kids to and from classes and appointments. That costs money. The average transportation cost is $260 per year.
Four factors determine your transportation cost:
● Mode of transportation
● How long do you have to travel
● How often do you have to travel
● Fuel price
Education
The cost of education is going haywire. Otherwise, people would be independent of student loans, or the debt level wouldn’t have increased. The average private college tuition fee costs around $12000 every year.
It’s tough to determine the actual education as much depends on the type of school your children attend. If the school is expensive, you have to shell out more money.
Conclusion
Apart from the expenses above, there are a few unforeseen expenses that parents have to cover. Broken toys are one significant expense for parents. The average cost is $239.
Five tips to stay debt free.
