Penny Can Raise A Kid For Less Than $40,000 Over 18 Years. That’s Waaayyyy Below The National Average.

This page has affiliate links to good products we endorse. Full disclaimer.

Dear Rich,

Oh, my gosh. Over $1 million to raise the twins!!! That’s incredible. Seriously, I can hardly even comprehend that number. You laid everything out really nicely, and I have no problem seeing how you came up with that amount… yet I’m still having a hard time wrapping my head around it. That amount is staggering! And you’re not even living an outlandishly luxurious lifestyle (well, maybe, kind of, sort of).

As you may have guessed, my numbers come nowhere close to that. They aren’t even close to the $233,610 that a CNN article mentioned or even the $174,690 that the USDA is estimating for low-income families in 2017. 

I ran the Cost of Raising a Kid calculator, like you did, and it estimated $7,000 per kid, yearly. For 18 years, that’s a total of $126,000, per kid. I still think that’s high.

Here’s what I came up with.

Looking at the categories that the USDA (and you) used to determine expenses, I’ll go through them one by one. Like you did, I’m going to figure this out accounting for all four kids, and then, at the end, divide it by 4. It’s just easier that way.


My family of six lives in a 1,190 square foot home. Our mortgage payment is only $843 a month. I don’t think we’re spending more money than if it was just Mr. Penny and me. Maybe we garner up some extra with the utility and water bills because of the kids (washing cloth diapers, for instance), so I’ll estimate $400 in additional yearly expenses for that. We haven’t spent very much money on furniture for the kids. We co-sleep, so have never needed a crib. We got their regular beds for free from people we know. We just have very little stuff, in general. But, I’ll estimate $100 here, just to be on the safe side. Plus, that will include stuff like toilet paper.



We all know how my family is on food support right now, so technically, we’re not really spending any money on food. However, for the sake of this article, if we were to be spending money on groceries, it would add up to around $700 a month. Except for the toddler, everyone in the family eats a similar amount of food, so the kids portion of that comes to $5,040 a year.

TOTAL FOOD = What we actually pay: $500

TOTAL FOOD = What we would pay: $5,040

Child Care / Education

No child care here, so don’t have that to worry about. I am super picky about education though, so we do a combination of homeschooling and sending our kids to a private school. We get pretty substantial scholarships. But, and again, for the sake of this article, let’s say we were paying full price. It would be $4,000 per kid for elementary through junior high. That would be for 5 years, since I don’t put my kids in school until 4th grade (more or less). Then, looking ahead to the high school we plan on sending our kids to, that will cost $7,000 per kid, for 4 years. So, $48,000 per kid, or $192,000 total for all 4 kids. I’m going to prorate that amount over 18 years, like you did. (Our actual amount paid, with scholarships, would be around $12,305 per kid total, or $49,220 for all 4 kids.)

TOTAL EDUCATION = What we actually pay: $2,734

TOTAL EDUCATION = What we would pay: $10,666


Okay, this is where I can see things adding up a bit. I’ve kept track of our transportation costs for the last 3 years. It comes to around $2,800 a year. I’m going to allot half of that to transport for the kids, so let’s say $1,400. Plus, after this fourth kid, we did break down (much to my utter chagrin) and got a minivan. It didn’t cost us much more to purchase than buying a regular car, so I won’t add anything for that. But it does use up more in gas money, so I’m going to allot another $600 for that, which will bring our transportation total to $2,000.



We get healthcare through the state, so we don’t pay anything for that. And honestly, we hardly use it anyway. I did have midwife attended homebirths with my first two kids, which cost a total of $3,200. (My last two kids were unassisted homebirths, so those births didn’t cost anything. And, no, I didn’t choose to have unassisted births because I could save money. I chose to have them because I don’t like to be around other people when I’m birthing, and I think, physiologically, that giving birth unobserved, except by my family, is the best way for me to give birth.) If we did have to pay for healthcare, we would go through something like Samaritan Ministries, which is a health sharing program. That would cost us $495 a month for our family of six. But it would cost us $440 a month for just Mr. Penny and myself, so that’s only an additional $660 per year to add the kids. This, of course, would not cover things like dental visits and braces. It costs around $4,000 to get braces. I’ll estimate 2 of the 4 kids needing braces, and prorate it over the 18 years.

TOTAL HEALTHCARE = What we actually pay: $621

TOTAL HEALTHCARE = What we would pay: $1,281


We have a handful of miscellaneous expenses, like sports fees, eating out, gifts, and the rare vacation that we take. Looking at my numbers for the past 3 years, I think I can safely estimate around $2,000 for all four kids (and that might be high) per year.


Click on image to watch on Amazon.


You’re going to think this is crazy, but, other than clothes for private school uniforms and shoes, I think I can count on one hand the number of times I have bought a new piece of clothing for my kid. The majority of the time, we shop at thrift stores or get hand-me-downs. Even if we made a lot of money, I think I would continue to do this. I like the idea of things being reused and recycled. There’s this documentary called The True Cost about the fast fashion industry, and consumerism in general, that is a really good look inside what it REALLY costs to make the clothes that we wear. We spend an average of about $400 for all four kids per year.


Okay, let’s add this up.

Here’s my graphic:


ANNUALLY – What we actually pay: $8,755 for all four kids = $2,188.75 per kid

ANNUALLY – What we would pay: $21,887 for all four kids = $5,471.75 per kid

18 years – We we actually pay: $157,590 for all four kids = $39,397.50 per kid

18 years – What we would pay: $393,966 for all four kids = $98,491.50 per kid

Something else to keep in mind is how having kids affect our tax returns. I remember after having our first kid how surprised I was with our difference in our tax refund. You probably itemize your deductions, so this doesn’t matter to you, but with each kid we have, we get a $4,050 deduction. With four kids, that equalled a $24,300, which brought our taxable income down to $2,044. If it was just the two of us, our taxable income would have been $26,300. So, the difference with kids is a $3,000 savings on taxes, and that doesn’t even take into account the Earned Income Credit (which I talked about in my post on taxes), which is something that low-income people get. That adds an additional $3,500 to our tax refund.

So, accounting for that, we can actually deduct $1,500 per kid in additional tax return money that we’re getting, so that would put our amount per kid at $688. For 18 years, that’s only $12,384. And to think, if we were not intent on sending the kids to private schools, we would actually be MAKING money on each kid.

Pretty crazy, the difference between our numbers, isn’t it, Rich? For 18 years, it costs you over $500,000 to raise a kid, while it costs us less than $40,000. These numbers are mind-blowing, in both directions, don’t you think?

This was fun,


3 Replies to “Penny Can Raise A Kid For Less Than $40,000 Over 18 Years. That’s Waaayyyy Below The National Average.”

    1. Financial independence before kids? Sounds nice, but can the financial clock beat the biological one?

      Also, I’d say the journey of raising kids is an adventure for sure, but I’m personally happy with a work / life balance. Going to work, thinking about adult challenges and working with other smart people can be an enjoyable break from Peppa Pig and Hide and Seek …
      Rich @ recently posted…Monthly Money Check: Rich Explains How He Meets Financial Goals Without A Budget — April 2017My Profile

Leave a Reply

Your email address will not be published. Required fields are marked *

CommentLuv badge