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What exactly is the true cost of raising a family?

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johnsmith1212
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What exactly is the true cost of raising a family?  Reply with quote  

I was just reading that in a major city (New York, LA, Chicago, DC, San Francisco etc.) it will cost roughly $450,000 to raise a single child from birth to 18 including cost of public four year college. For two kids that is almost $1 million (including things like extra expenses for family vacations through at least 10 of those years not accounted for in the above calculator).

My question is how are families having a middle class family life and saving for retirement? The math above does not seem to add up. Say an average family earns $100,000/yr combined, granted there are some tax breaks but even so what is the net income after taxes? Or is this calculator above broken and the cost of raising kids is much lower?

Also, the above calculators are for a best case scenario not taking into account periods of unemployment in a bad economy or unexpected illness or unexpected family expenses.

The expenses start right at the point of marriage - the proposal and ring average of $5,000, the average wedding cost itself is $30,000, then the average cost of honeymoon is $10,000, that itself is $45,000 starting out. My question is where are people getting all this money?
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Last edited by johnsmith1212 on Sun May 14, 2017 2:43 pm; edited 1 time in total
Post Mon May 08, 2017 9:42 am
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oldguy
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quote:
the proposal and ring average of $5,000, the average wedding cost itself is $30,000, then the average cost of honeymoon is $10,000, that itself is $45,000 starting out. My question is where are people getting all this money?


From what I've seen over my past 78 years is that they borrow it, lol. But keep in mind, those "average" values are generated by folks who sell those products - and they only see the folks who buy those things, ie, that is the 'average' that the writer publishes. Plus, writers need some 'shock factor' to make their work controversial & interesting. There are millions more who elope, load up the car and spend a honeymoon week in a tent in a national park - their $45,000 bill is closer to $500 for gas. And all levels between $500 & $45000. A young couple has to decide what is important to them - many folks don't want to start their marriage with a $50,000 credit card bill.

A family with kids has a totally different view of entertainment than pre-kid couples. A pre-kid couple might go on a $10k Cruise - a couple w/ kids might drive over to Grandma's farm for 4 or 5 days. (almost zero cost, Grandma provides the beds & food, all you need to buy is a couple tanks of gas.

We raised our children, paid for their colleges. We gave each kid a used car when they were in HS & college. We paid for our home, built on an acre of horse property (and the kids had ponies/horses). Our combined incomes before retirement was only slightly above $100k. Vacations were mostly road trips - camping, horses in the forests, etc - Canada, Alaska, all of the lower 48. We always had the money to buy what we wanted/needed - and we invested enough in our 401k's to become millionaires.

The "major city (New York, LA, Chicago, DC, San Francisco etc.)" is a big factor, we prefer small towns. I was sent to all of the cities that you mention & many others during my career - but never ever wanted to live in them.
Post Mon May 08, 2017 3:55 pm
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littleroc02us
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Luckily I married a frugal woman who did a great job planning our wedding on the cheap, but quality. She had her wedding dress made for $400, we got married at an old civil war mansion for $150, our recption reservation was only $200 at a private golf course, we only had a pay bar, we spent $2000 on the meal. I was able to get my buddy to DJ for $500, my photographer was a teacher at the school I worked for and he brought 2 students and did it for the cost of 3 meals, my buddy let me use his 1984 Corvette and our honey moon was our only splurge at $3,000. Her ring was $2,000 and I sold my snowmobile to buy that. So we started out with no debt except our student loans (30k) which we paid off in 5 years. Of course they were mine, because she graduated with no student loans.
Where most parents screw things up is daycare and college. Daycare if you do your research can be less expensive by researching and finding an older daycare center that has been around for at least 20 years and isn't all flashy and new.
College is where most parents are the dumbest. Our society has been brainwashed that all kids must go to a 4 year University to make a good salary. Well, some kids need a trade like plumbing or electrical, computer science which only takes a techncial college, which is drastically cheaper then a State or University college. I work at the University of Minnesota and students here take out thousands more then they need in student loans to get a Liberal Arts degree to make $15 an hour when they graduate and they stay in these shiny new apartment buildings that are rising all over the place. Some of these buildings have gyms, pools and hot tubs. I mean when I went to school my radiator produced more heat in the summer then the winter. They go out to eat for every meal and buy $5.00 mocha's 3 times a day.
Parents need to learn what ROI is on the career choice of their children and guide them to go to a smaller State school that's in your home state that is much more affordable and will produce the same outcome. Also, I hear this all the time, where parents don't want their children to work during the summer 60 hours, because they need to work on their Art portfolio. Give me a break. When I went to Liberal Arts school, I worked 3 jobs during the summer and I joined the Marine reserves to get the GI Montgomery bill to help pay for school and I still got good grades.
So, it is a fact that these studies are true, but it's only because parents have caused most of the problems. also, your child doesn't have to be Thomas Edison to get a scholarship. I was a B student in highschool and got a scholarship by entering a local competition to produce a video of the town of Waconia and won. You have the ability to change this.

Risk comes from not knowing what you're doing. (Warren Buffet)
Post Tue May 09, 2017 2:06 pm
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