It’s the goal of many households to one day have children, but if they aren’t prepared for the endeavor, they could find themselves in a financial bind in the future.
Having and raising a child can be very expensive, and this doesn’t just include the cost to actually have a child in a hospital. According to data compiled by CNNMoney, the average American household can expect to spend roughly $241,080 per child during the first 18 years of their lives.
The largest annual expense families endure when is comes to their children is childcare and education, the report said. This is followed closely by healthcare costs, clothing and miscellaneous expenses, while food, housing and transportation round out the bottom three costs.
However, in today’s economy, when a child turns 18 years old the expenses don’t always end.
The cost to attend a public four-year college increased more than 8 percent last year, while private college tuition inflated 4 percent, a separate CNNMoney report indicated. In an effort to offset this cost for their children, a survey conducted by Fidelity showed that 69 percent of households have already started putting money away for their children to go to college.
But despite this effort, the average college-bound student can expect to cover roughly 38 percent of their college tuition in the form of student loans. Although this type of financing gives young Americans a chance to receive a college degree, in a currently soft labor market, getting a high-paying job after graduation can make repayment difficult.