The Parent Trap: Budgeting Tips for the Cost of Raising a Child

It costs more money than ever before to raise a child. According to CBS News, from birth through age 17, the average cost of raising a child is $233,610, or almost $14,000 per year. That number includes expenses like housing, child care, education, and health care.

Thankfully, there are ways to offset some of these costs, from shopping secondhand to opting for free experiences. Here are some budgeting tips to help you save for the cost of raising a child.

Every stage of life comes with its own expenses

Andrea Woroch, a nationally recognized family finance expert and mother of two, says that every stage of life comes with its own expenses. Babies just need diapers, but once they're toddlers, you need to spend money on swimming lessons and preschool. When preschool is over, maybe your child will attend public school—which is free—but they may want to enroll in extracurricular activities and summer camps, or need tutors. In their teens, they'll need smartphones and auto insurance. There are also hidden costs you can't anticipate, like braces and trips to the emergency room.

"Ultimately, though, the amount of money you spend on your child beyond the necessities and required medical costs are your choice," says Woroch.

Since you do have a choice as to what you spend your money on—for instance, you don't need to send your child to an exclusive summer camp or get them a smartphone in the sixth grade—you can start budgeting in order to save for crucial things like retirement and your child's college education.

Look for ways to save on necessities

A top budgeting tip for families is to be creative when it comes to saving on necessities. According to Woroch, you could look for secondhand options for clothing, furniture, and toys online on Facebook Marketplace and OfferUp, and in thrift shops.

Also, you can clip coupons and use Honey, the browser extension that automatically searches for coupon codes. You'll be surprised how much they'll help you save.

Roll your spending over to savings

Nikki Rue, founder of She Saves She Travels and a mother of two, encourages families to save their money to prepare for the costs of raising a child. She says you can do this by rolling your spending over to your savings account once a commitment is complete.

For instance, after your child leaves preschool and goes to public school, you could save anywhere from a few hundred dollars to over $1,000 per month on average. Instead of taking that money and spending it on a new car, Rue recommended building emergency savings, putting it away for a down payment on a new home, or placing it in an account for your child's college.

"By rolling over the funds that you're used to spending, you're creating a better financial future for yourself and your family," she says. "[As a bonus], you likely won't even notice the difference in your monthly budget, because you're already used to spending it."

Search for free things and experiences

One of the best budgeting tips and tricks to offset the average cost of raising a child is to take advantage of free things and experiences. According to Andrew Chen, founder of Hack Your Wealth, you can look for giveaways and donations from other parents on company parent email lists, Facebook, and Craigslist. "Parents whose kids have grown out of equipment and gear are often willing to donate to other parents," says Chen.

In addition, Woroch recommends looking for free things to do around town, such as going to a free museum, checking out book readings and craft areas at the local library, and attending free classes. "There are plenty of opportunities to have fun without spending money, or at least not a lot of money," she says.

Use cash-back credit cards

You're likely using credit cards already anyway, so why not get some money back from your purchases? Chen recommends cards like the Amazon Rewards Visa Card or the Chase Freedom Unlimited, which offers unlimited 1.5% cash-back on everything. "This will net you additional savings and cash-back rewards to further lower your costs," he says.

If you keep in mind these important tips when budgeting and carefully track your finances, you will be well on your way to having a robust emergency fund and savings account. Even though the cost of raising a child is high, you can afford it by getting your finances in order.