Newborn babies don't seem too expensive. They're too young to care about overpriced toys and breast milk doesn't cost anything. If you're willing to use washable cloth nappies, you're basically raising it for free.
Except this is obviously bollocks. An Australian mum recently did the maths and worked out that her bub cost approximately $32,360 over one year. Here's where all that money goes.
Over on POPSUGAR Australia, Erin Riley reveals the huge financial costs associated with bringing a human into the world. Even if you skimp on the nursery and other infant luxuries, the outgoing costs during baby's first year are significant.
"As our bank account has dwindled, I realised just how much I underestimated the expense of having a child," Erin explains. "It’s not just the big upfront cost either: our weekly expenses are higher and our income is lower.
"It turns out our daughter costs my partner and I $32,360 per year. After tax."
To calculate the cost of raising her baby, Erin first compared her income to before the baby was born. Working part time resulted in a total household post-tax income deficit of $18,900. Then there were the actual costs:
I added in the direct costs (childcare, $8,100/year after the rebate; baby expenses, $1,200/year) and indirect costs ($4,160/year in additional rent to live somewhere bigger, despite the fact we moved 20km further out of town) of having a baby.
I was fairly conservative — even shopping at Aldi, $100 a month for food, formula, baby clothes and nappies is optimistic — yet still, the number was huge.
As Erin points out, every couple is different and makes different choices. But there's no such thing as a cheap baby. To calculate the amount of money you'll be living off, simply subtract your post-baby expenses from your post-baby income and "stare at your new reality."
For a more detailed breakdown of baby expenses in Australia, head to the original article and follow Erin's formula.
[Via POPSUGAR Australia]