Thursday, November 21, 2013

Our Greatest Kid-cost Savings Come Between Ages 2 and 4

Kids can be costly, but they don’t always have to be as expensive as they’re made out to be.  Sure, things can happen -- health issues or childcare situations -- that can indeed raise the price of having kids, but sometimes there are significant savings to be had as well when it comes to kid costs.

As a parent of two kids myself, and as a work-at-home dad, I’ve begun to realize that after the birthing process and all those initial baby costs are covered, our greatest kid-cost savings come between ages two and four.

Ditching those pricey baby needs
A Parenting.com article notes that, “According to a 2010 USDA report, the average middle-income family will spend roughly $12,000 on child-related expenses in their baby’s first year of life. By age two, parents are up to more than $12,500 per year.”

Thankfully, our costs were nowhere near this high; however, they were still significant.  And while there are many one-time costs involved with having a baby, there are certain expenses like diapers, wipes, formula, and food that can keep the costs coming.  That same Parenting.com article when on to say, “Parents can count on spending close to $50 per week ($2,448 per year) on diapers, formula and baby food alone.”

We don’t spend quite that much since we buy store brand products which are often 25-50 percent below the name brand prices; however, once we get past the potty training phase and our child starts moving away from formula into solid foods, our costs drop dramatically.  This is why I tend to make a push to start such transitions earlier rather than later. 

Cutting out diapers, wipes and formula alone will put about an extra $80 to $100 into our pockets each month.

They’re smart enough, but not too smart
By age two, many kids are starting to catch on to things pretty quickly.  I like to call ages two to four the “perfect” years.  Kids are hitting that point where they are smart enough to listen and obey, but they’re not smart enough to care too much about what they wear or don’t wear, what brands they eat or use, and where we shop.

This means that it can be a great money-saving period.  During this age timeframe, we shop for most of our clothing needs at resale locations and garage sales.  Since at this age range our kids aren’t in school yet, they don’t need to have the latest trends or what everybody else has.  We can accept hand-me-downs, and we don’t have to have name brand foods from the store.  In these ways, we’re able to keep our clothing costs for a family of four around $300 a year, and food and entertainment costs around $300 a month.

Fun is free! (or at least cheap)
An article in The Florida Times-Union notes, “Informal surveys show that in recent years, on average, parents spend $200 to $400 on birthday parties. And some wealthy families may spend up to $5,000 or more, said Heather Downs, a professor of sociology at Jacksonville University.”

After that first birthday party though when it’s often more about the parents and family than the child, we’ve found that such costs aren’t always necessary between ages two and four.  The kids are often fine without hugely expensive birthday parties and they’re just happy being with friends and family whether it’s at the local park or playground, a McDonald’s playland, or even grandma and grandpa’s house.

A trip to the library, the zoo, parks, and playlands can act as perfect entertainment (and great ways for the kids to burn energy) at low cost levels.  And the best part is that the kids are often just as happy as if you’d spent hundreds or even thousands of dollars on entertaining them.

So the next time you’re thinking that the costs involved in raising a baby won’t ever ease, just remember, there may be opportunities right around the corner for cutting those expenses dramatically.

 

Disclaimer:

The author is not a licensed financial or parenting professional.  This article is for informational purposes only and does not constitute advice of any kind.  Any action taken by the reader due to the information provided in this article is solely at the reader’s discretion.

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