How Much Does It Cost To Raise A Baby In Its First Year?

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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]


Comments

    Yet the government thought it was a good idea to incentivise people to have babies.

    What idiots.

    It looks like the cost of having a baby is quite cheap for the first year. The cost of daycare and even more so the extra rent for a larger house are personal life choices that other people won't necessarily do.

    It can cost anywhere from nothing to a million dollars in the first year (if your a kardashian).

    We got lots of stuff given to us, in the first year we really only paid for

    Car Seat, Some Clothes (lots were given to us but wife still wanted to buy some, but we ended up with more than we ended up using), Nappies, Baby Food, Bottles and Pump, Baby Monitor, Cot and a little bit extra on water for baths (or they can shower with you and its virtually free water).

    Excluding intangibles (like loss of income [paid parental leave covered this] and child care [not everyone needs it], health insurance which covered the birth [since it could have been done in pubic anyway, but +250 out of pocket])

    So all up, probably cost us $1500-$2000 and we could have skimped more by not buying a pricey monitor and bottles and pump, and less clothes (come on they only need like 4 onesies in each size if your desperate) and skipped the baby food entirely (give them real food) and by using cheaper disposable nappies or cloth instead (instead of huggies, which we swapped to babylove for baby2 and even had less blowouts).

    Although by her reasoning baby2 cost us over $27,000 because we needed a new car if we wanted to continue to use the boot, stupid cars with anchor points at very rear of hatchback boot, although granted we didn't have to buy such a nice car, but we did.

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