We’ve told you about how the birth rate in the United States has gone down to historically low levels. Now we’re going to tell you why it’s happening.
Simply put, it’s about money. The Department of Agriculture says the average cost of raising a child is almost 235 thousand dollars. But financial analyst Richard Rosso says that number is actually low.
“What’s made a greater impact is the added pressure for greater performance with all the activities that kids have today, and all the money you shell out for those activities,” Rosso said.
Rosso says that kids today need more things than many of us did growing up.
“Technology has added a lot to the cost. For us, it was very simple. But it’s not anymore. That simplicity came with lower costs,” Rosso stated.
Families are spending 118% more on activities for their kids than they did just two years ago. And Rosso tells KTRH parents really don't care about the cost.
“Parents will pay it because it’s for the benefit of the child, even if there is a negative financial impact on their household,” Rosso explained.
We're also spending 70% more now than we did just two years ago. Rosso says look for that number to go up.
“There’s a lot of pricing power by organizations to increase and get what they are asking for. They’re testing that right now and they are still getting it. That’s a trend that is going to continue,” Rosso told KTRH.
So, is there a magic number when it comes to being financially ready to have a child? Rosso says there isn't, that you're always going to overspend, and that costs are going to continue to go up.