Amanda Amezcua Profile Picture
Staff Writer at Debt Reduction Services

Finding Affordable Ways to Raise a Family

Tips to afford raising children

When I decided to address this topic, I set out to get a better understanding of how families are handling the cost of raising children. Are they managing or are they struggling and what determines the difference?

In the first part of my article, I discussed that the USDA reported that it costs over $233,000 to raise a child. With the help of contributors, I answered three questions: do you agree with this estimate? How have you managed to afford raising children? What advice would you give to individuals who are considering starting a family? You can read their answers here.

Many times families seeking credit counseling express the stress they feel because their money doesn’t seem to stretch far enough. Underestimating the cost of children is often the cause. In this situation, what is a family to do? Resign to financial ruin? I was very pleased in my previous article to have felt voices added to my own in answering with a resounding, “no!” It was agreed that if parents are conscious about their spending and utilize some major money-saving strategies, raising a family could be fulfilling as well as affordable.

With those words in mind, we’ll look at the advice submitted for two remaining questions. My hope would be that armed with these financial tips you will be able to better prepare for the coming years of family life. Children are only children for so long and the sooner you can sideline financial stress, the sooner you can focus solely on making the most of the moments with them.

Q:3 What costs have caught you by surprise?

Medical Bills

Selecting insurance to pay for pregnancy care and childbirthThe first cost to surprise you may be the medical bills associated with prenatal, delivery, and post-natal care. If possible, choose your medical insurance with these expenses in mind. The final cost will be over $10,000 and your insurance, no matter how good, usually expects you to pay a percentage. Having prepared better for my second pregnancy, my medical bills came in right around $1,000. If this amount seems difficult to pay on a whim, creating a specific savings for this purpose is an idea worth considering.


S.C., a parent in Oakland, California pointed out that first comes baby, and then comes childcare costs. Finding quality childcare at a reasonable rate can be a real challenge, whether you choose to pay an agency or individual, or have decided that one spouse will give up their income and stay at home.

Depending on where you live, this can amount to thousands of dollars a month and must be planned for in order to manage the impact it will have on your budget. The same contributor suggests seeking out a childcare co-op or nanny share in which you are working with others either sharing the cost or the care.

You may remember another solution from part one of this topic. Krystal R. and her husband opted to shorten the work week by adding more hours to each day. This way, they paid for one less day of daycare.

You may also have the option to work somewhat of a reversed schedule from your spouse, working the weekend to take off days during the week to care for children.

If none of these options are feasible, you may find hope in working from home. More and more jobs can be performed remotely, including customer service, billing, transcribing, blogging, etc.

Lifestyle Changes

Living within your means while raising a familyDr. Margaret J. King, the Director of the Center for Cultural Studies & Analysis is wise to note that having children will affect almost every expense in a budget. She writes, “Having children determines where you live, the size of the house, the family diet, how and where you spend your time, your friendship group (other parents of children the same age), the job you hold and the income you must make, transportation and safety costs, healthcare, energy use, and every other cost base in a household.”

While the thought of these bills may create an overwhelming picture, realize that you can consciously decide to lessen how much you spend in each one of these categories. Consider the creative ways in which you can enjoy life and live within your means.

Life Insurance

Scott W. Johnson, of Whole vs. Term Life Insurance, often advises individuals with kids at home to increase their life insurance. If a death were to occur, it may be difficult to meet that child’s needs without planning for that situation prior.

Budgeting for your children's extracurricularsSchooling

Scott, who is also a parent, suggests preparing for educational costs such as pre-school tuition, tutoring, additional home computers, private school tuition, project or class supplies, and SAT/ ACT preparation courses.

You can also expect to factor into your budget added vacation costs, music or sports programs, the child’s medical and dental insurance, contributions to a college savings account, and payment for the occasional babysitter.

Q:4 What would you have done differently to save money or be in better financial shape?

Take the advice shared up to this point and start preparing for the upcoming expenses discussed. Any money you can save ahead of time is less you’ll need to come up with on the spot.

If you are able, secure the best insurance deal for the services you and your baby will require. It doesn’t hurt to shop around later as well to ensure you are getting the best price for the most useful coverage.

Eventually, your kids will start asking for the things their friends have. Until that day comes, save money by buying secondhand clothes, toys, and room décor. It’s also a good idea to borrow certain pieces of baby furniture that will only be used for a few months anyway.

In the interest of saving money, consider downplaying birthdays. Do you remember what your birthdays were like when you were a kid? I rarely had a party apart from having family over for cake. Am I bitter? No. Do I even remember my first 4 birthdays? No. Since when did it become necessary to invite an entire school class to a birthday party, serve a full meal, and fork out for all the imaginable rentals? I felt a need to go all out for my daughter’s first couple birthdays and have learned that my money can be spent more wisely. I still understand the need to make your child feel special on their day.

Save money on birthday partiesMy advice would be to alternate from year to year what kind of celebration you will hold. Choosing more low-key activities, like taking the family plus one friend to a restaurant of choice, or a couple friends to ice cream will make your child feel recognized and important and save you thousands of dollars over their childhood.

Speaking of birthdays, if you are having difficulty contributing to your child’s savings fund or are hesitant to pay out for an extracurricular activity, have family members aid with these as a gift instead of adding another item to the floor of the toy room. Most children receive enough presents that one will not be missed, and what they receive instead will be of greater value.

When it comes to having a baby, I recognize there are certain things that every family needs to make raising children easier and more comfortable. If you want to remain in good financial shape, resist the urge to overbuy on these necessities. Do you need a brand new SUV or van if you are only toting two kids around? You can probably get by with a Sudan. Should you buy a different house just so each child can have their own room? If you have two children, it may be affordable. If you have 6, it would likely be a dangerous stretch.

Additionally, the baby industry profits greatly off trendy gear, toys, and clothes. Don’t be a victim to every fashionable item if you want to manage your family budget with ease.

Lastly, start a college savings early on. If this is what I could do over, I would. As a young parent, I made excuses: we have other priorities right now, we don’t have enough left over to contribute, we can make up for it later on, etc. In actuality, if you can put away even $10 a month, you’d have $600 by the time your child starts Kindergarten, not to mention the interest it’s accumulated over those years.

Opening a college savings account, such as your state’s 529 plan can even shelter your savings from tax or lock in today’s tuition cost for the day your child pursues a higher education. Your child is sure to be grateful whether you can save for all four years or only a few semesters. The more you can save, the less they’ll have to borrow.

Raising a family is an unmatched experience and the joy you feel from doing so will always make the cost feel worth it. However, the stress you feel from lack of financial control may not. Plan ahead, spend modestly, cut costs where you can, and face the future optimistically and confidently. You will be well on your way to a fiscally responsible home that the whole family reaps the benefits of.


Amanda Amezcua

Staff Writer at Debt Reduction Services

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Related Articles:

Cost of Raising a Child


Do You Have Questions About or Suggestions on How to Plan for the Expenses of Raising Children?

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  1. Bree Ward

    I agree that finding the right childcare service is sometimes challenging and difficult. My sister just has her baby 2 months ago, and she needs to report to work. No one in the family will be able to look after the baby. She is now looking for a reputable child and development services in the area that can help her further.

  2. Veryse

    Thanks this is very helpful information, thanks!

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