How expensive are kids?

Mintycake · 04-21-2009, 02:59 PM

Hello

Contemplating starting a family here with my husband. Currently we are double income, but both of us feel pretty strongly about a parent at home. So really...how expensive are kids?

I have this debate with co-workers who are parents, and from the sound of things, they can be horrendously expensive. Though I remember growing up in a single income family and not wanting for anything. Mind you, my parents did not pay for things like my university education or a car, but I had food, clothing, and shelter, and I had piano lessons and ballet lessons.

We figure we're in a good spot right now. RRSPs are maxed out, we are mortgage free, and the only debt we have is investment loans that are not due for another 20 years.

michika · 04-21-2009, 03:02 PM

I think the first step would probably to be decide on the lifestyle you'd want to live with your child(ren).

I know that my brother & sister-in-law, started out on a good financial path, and then had a few children, and now they are completely different people financially. People always want the best for their children, but sometimes I think they loose sight of the fact that best is not always equatable to the most expensive item/product/school/etc.

johnsazzr · 04-21-2009, 03:04 PM

Quote:

Originally Posted by Mintycake

Hello

Contemplating starting a family here with my husband. Currently we are double income, but both of us feel pretty strongly about a parent at home. So really...how expensive are kids?

I have this debate with co-workers who are parents, and from the sound of things, they can be horrendously expensive. Though I remember growing up in a single income family and not wanting for anything. Mind you, my parents did not pay for things like my university education or a car, but I had food, clothing, and shelter, and I had piano lessons and ballet lessons.

We figure we're in a good spot right now. RRSPs are maxed out, we are mortgage free, and the only debt we have is investment loans that are not due for another 20 years.

Just do it if you really want kids..I am as frugal as they come and the 2 youngest were babies, my wife stayed home and we lived on 40k/yr income with small mtg pmt and no other debt just fine.

Not the same situation now with 3 kids and 2 incomes. My teacher spouse took 1 yr mat leave and worked the 2nd ty only part time so our income was reduced quite a bit for 2 yrs, but we hardly noticed because we budgetted for it. And we would do it again...children can bring things to your life that money and financial security never will for many people...I also know people who do not ever plan to have kids and that is fine, just not for me.

CanadianCapitalist · 04-21-2009, 03:15 PM

I took a stab at this question a few years back. To give you some background, we have twin 3-year old boys and one baby girl. Yes, the cost of diapers adds up quite fast and you'll know the real meaning of "liquid gold" when you purchase formula but we've found that the two biggest expenses by far for us have been daycare and the opportunity cost of Mom going on mat leave. Both are in the tens of thousands of dollars. And, of course, there is college savings but at least you can save for college over more than a decade.

How much does it cost to have a baby?

canabiz · 04-21-2009, 03:25 PM

I read an interesting article the other day when the writer questions whether we should contribute to RESPs ? Tax benefits aside, his points are the Baby Boomers and the Gen X generations are typically on their own when it comes to post-secondary education. Getting OSAP (Ontario Student Assistance Program), part-time jobs, scholarships, bursaries...just to name a few of the many financial avenues available to students.

This will allow students to be more financially independent and resourceful instead of having everything handed to them on a silver platter.

His simple question was : Is RESP over-rated ? and you know what I think he made some very valid points.

Rickson9 · 04-21-2009, 03:29 PM

http://www.ccsd.ca/factsheets/family/

You can scroll down to the section entitled, "The Costs Of Raising Children"

You can also go to Statistics Canada to dig over there. They have various data associated with the topic as well.

CanadianCapitalist · 04-21-2009, 03:30 PM

Quote:

Originally Posted by canabiz

This will allow students to be more financially independent and resourceful instead of having everything handed to them on a silver platter.

His simple question was : Is RESP over-rated ? and you know what I think he made some very valid points.

I don't think so. Even if you believe that kids should fund part of their education, a RESP might make sense. Just contribute, get the matching grants and allow it grow. When the time comes for kids to go to University, withdraw your contributions for your own use and give the grants plus growth to the kids.

With their education only partly funded, it will allow the kids to be resourceful and financially independent.

Mintycake · 04-21-2009, 05:10 PM

Thanks for everyone's responses! Our plan is to only have one child and stop there. That will allow us to stay in our small home (2 bedroom) and also reduce the cost of child care should I go back to work (but we are going to try to make it just on my husbands income until the child goes to school, and then I will work part time). The one scary variable is my husband is self employed - there are years where he makes more than me but years where he makes less. I also have benefits etc but we have decided I will be the one to stay home since I have no love for my job and he loves what he does.

We plan to fund RESPs to get the grant but that's it - anything over and above that for post secondary costs have to be paid by the kid - my husband and I paid for our own educations and we both managed to graduate debt free by working hard and being frugal.

FrugalTrader · 04-21-2009, 05:37 PM

We have a one year old now which has been the best thing to happen to our family. Yes, babies can be a bit costly, but they are worth every penny!

I've written some articles for (potential) new parents that explain the costs ,various tax credits and government programs:

lb71 · 04-22-2009, 08:27 AM

First thing to consider is your spending habits. You double income allowed for a certain lifestyle. Once that second income is gone, you have to realize that you cannon just buy anything at will. You'll also have extra expenses with the baby. The good thing is you are mortgage free.

If you lose your benefits, make sure you and your husband buy some insurance.

04-21-2009, 02:59 PM	#1
Mintycake Junior Member Join Date: Apr 2009 Location: The Big Smoke Posts: 23	How expensive are kids? Hello Contemplating starting a family here with my husband. Currently we are double income, but both of us feel pretty strongly about a parent at home. So really...how expensive are kids? I have this debate with co-workers who are parents, and from the sound of things, they can be horrendously expensive. Though I remember growing up in a single income family and not wanting for anything. Mind you, my parents did not pay for things like my university education or a car, but I had food, clothing, and shelter, and I had piano lessons and ballet lessons. We figure we're in a good spot right now. RRSPs are maxed out, we are mortgage free, and the only debt we have is investment loans that are not due for another 20 years.

04-21-2009, 03:15 PM	#4
CanadianCapitalist Administrator Join Date: Mar 2009 Location: Ottawa, Ontario Posts: 886	I took a stab at this question a few years back. To give you some background, we have twin 3-year old boys and one baby girl. Yes, the cost of diapers adds up quite fast and you'll know the real meaning of "liquid gold" when you purchase formula but we've found that the two biggest expenses by far for us have been daycare and the opportunity cost of Mom going on mat leave. Both are in the tens of thousands of dollars. And, of course, there is college savings but at least you can save for college over more than a decade. How much does it cost to have a baby? __________________ Canadian Capitalist -- A Canadian Personal Finance Blog

04-21-2009, 05:37 PM	#9
FrugalTrader Administrator Join Date: Oct 2008 Location: Newfoundland Posts: 591	We have a one year old now which has been the best thing to happen to our family. Yes, babies can be a bit costly, but they are worth every penny! I've written some articles for (potential) new parents that explain the costs ,various tax credits and government programs: Newborn baby expenses Shopping for a newborn - the list Shopping for a newborn - summary and tips After the baby is born Tax Credits and other perks - spousal amount, cctb, uccb __________________ Million Dollar Journey - Follow my journey to one million in net worth..

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04-21-2009, 03:02 PM	#2
michika Senior Member Join Date: Apr 2009 Location: Calgary Posts: 162	I think the first step would probably to be decide on the lifestyle you'd want to live with your child(ren). I know that my brother & sister-in-law, started out on a good financial path, and then had a few children, and now they are completely different people financially. People always want the best for their children, but sometimes I think they loose sight of the fact that best is not always equatable to the most expensive item/product/school/etc.

04-21-2009, 03:25 PM	#5
canabiz Senior Member Join Date: Apr 2009 Location: Ottawa, Ontario, Canada Posts: 183	I read an interesting article the other day when the writer questions whether we should contribute to RESPs ? Tax benefits aside, his points are the Baby Boomers and the Gen X generations are typically on their own when it comes to post-secondary education. Getting OSAP (Ontario Student Assistance Program), part-time jobs, scholarships, bursaries...just to name a few of the many financial avenues available to students. This will allow students to be more financially independent and resourceful instead of having everything handed to them on a silver platter. His simple question was : Is RESP over-rated ? and you know what I think he made some very valid points.

04-21-2009, 03:29 PM	#6
Rickson9 Banned Join Date: Apr 2009 Location: Mississauga, Ontario Posts: 702	http://www.ccsd.ca/factsheets/family/ You can scroll down to the section entitled, "The Costs Of Raising Children" You can also go to Statistics Canada to dig over there. They have various data associated with the topic as well.

04-21-2009, 05:10 PM	#8
Mintycake Junior Member Join Date: Apr 2009 Location: The Big Smoke Posts: 23	Thanks for everyone's responses! Our plan is to only have one child and stop there. That will allow us to stay in our small home (2 bedroom) and also reduce the cost of child care should I go back to work (but we are going to try to make it just on my husbands income until the child goes to school, and then I will work part time). The one scary variable is my husband is self employed - there are years where he makes more than me but years where he makes less. I also have benefits etc but we have decided I will be the one to stay home since I have no love for my job and he loves what he does. We plan to fund RESPs to get the grant but that's it - anything over and above that for post secondary costs have to be paid by the kid - my husband and I paid for our own educations and we both managed to graduate debt free by working hard and being frugal.

04-22-2009, 08:27 AM	#10
lb71 Senior Member Join Date: Apr 2009 Location: Toronto Posts: 186	First thing to consider is your spending habits. You double income allowed for a certain lifestyle. Once that second income is gone, you have to realize that you cannon just buy anything at will. You'll also have extra expenses with the baby. The good thing is you are mortgage free. If you lose your benefits, make sure you and your husband buy some insurance.