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Financial Independence With Kids: How Procreation Impacts FIRE

Ecuador Galapagos Beach

Having recently spent nine days away from home at not one, but two mega-conferences, I was happy to be home and eager to wake up last Monday morning to get my boys ready and off to school. It’s not often I look forward to a Monday morning, but after a long stretch away like that, I start to feel disconnected from my normal life.

My wife joined me at FinCon, which was awesome, but our boys are such a huge part of our lives that I feel off-center without them. We’re planning to bring them with us for next year’s blogging conference in Orlando. I hear there are fun things to do in Orlando.

I would not encourage couples to use finances as a top factor when considering starting a family — that’s a question with many facets (as evidenced by this forum thread on the topic), and money is a small piece of that puzzle.

Still, I think it’s a worthwhile exercise to evaluate what the effect of procreation on eventual financial independence might actually be. After all, kids aren’t free. Far from it.


Children Cost Money



The Department of Agriculture releases annual data on the cost of raising a child to age 18. The most recent estimate of that cost was a whopping $233,610 in 2015 dollars. For the full breakdown, see the 2017 report from the Department of Agriculture. Our friend Vagabond MD, in his guest post Kids are Dynamite For Your Early Retirement, suggested they might cost even more than that for some.

Of course, the cost of raising children is largely up to you, but there are no free kids. Conception might have cost you the price tag of a Yankee candle and bottle of Two-Buck Chuck, but the delivery costs a whole lot more. After that, you can expect to pay for a host of additional expenses, including but not limited to:

  • Food. Humans need it.
  • Shelter. Plan on one or more extra bedrooms and an extra bath.
  • Clothing. Babies and toddlers seem content without it, but they all need it.
  • Child care. They can’t take care of themselves until sometime around 27, give or take.
  • Healthcare. Our boys have had two surgeries apiece. YMMV.
  • Vacations. Disney moves way up on the list of desired destinations.
  • Activities. Sports, music and other arts, camps, etc…
  • Parties. Your kids will have birthdays. So will all their friends.
  • Transportation. They didn’t get to the airport and soccer field independently.
  • Education. Education isn’t optional, but many of the costs can be.
  • Higher education. Again optional, but we’re funding 529 Plans to six-figure sums.
  • Utility Bills. Increased laundry, water, electric, etc… and so many batteries.


mall of america. not cheap.


There are many things you can choose to do to keep these expenses in check, but you will be spending money on these kids every single day for at least eighteen years. It’s just a fact of parenthood.


How Much Money Can Raising Children Cost?


Just as there is a vast range that we spend on ourselves as adults, there is similarly a wide range that we spend on our children. In order to do some calculations and work with spreadsheets — you do want to work with spreadsheets, don’t you? — we will establish some varying of levels of spending.

I also think it’s fair to consider the fact that you’ll spend a bit more on the first child, and subsequent children will cost a bit less thanks to hand-me-downs, sharing of toys, bikes, etc…

On the low end, for the frugal family, we’ll say raising the first child costs you an average of $5,000 a year, and additional children cost $4,000 apiece. When you consider all the additional expenses above, and the fact that this is less than half the Dept of Ag’s estimate, this will require many frugal choices.

Our next tier, the moderate spenders will be a more typical middle class expenditure of about $9,000 per year for the first child, and $7,000 per year for each additional child.

Our upper middle class child-rearing expenses will approximate the Department of Agriculture estimate at $12,978 per year (rounded to $13,000), and her younger siblings’ expenses will be $10,000 per year.

Our upper crust children spend most of their 18 years in private schools. This substantially raises the cost of raising children to an average of $30,000 per year for the first little guy. Hand-me-downs are not happening, and each child has their own room, so his brothers and sisters will have equal expenses.

Our friends at the Depatment of Agriculture have put together a calculator to assist you in determing the cost to you based on the number and age of your children, the number of parents, the region in which you live, and your annual income. You can even enter your kids’ names, although I don’t think that’s going to change the numbers.

Here are my results:


Cost to Raise Children
my expensive children, apparently


The calculator says I can expect to spend about $39,000 on the two boys this year. Considering we’re on pace to spend around $55,000 as a family in 2017, the wife and I must be relative bargains!


Adding Up The Costs to Raise The Kids


To keep these calculations relatively simple, we’ll use a constant cost that doesn’t vary year to year. In reality, babies, toddlers, and teenagers will have different needs than a grade-schooler, but we’re using an average cost.

We also have to consider the fact that there is an opportunity cost to money spent in the first few years of life compared to the sum we drop on the high school graduation parties. The $300 you spent on a crib could have been left invested. Using the rule of 72, we can quickly deduce that with an 8% return, that $300 would have doubled twice by the age of 18 to $1200.

What about inflation? As I’ve done in the Four Physicians series, we’ll use real (inflation-adjusted) returns to calculate the opportunity cost of the money we spend raising our children. We’ll calculate the cost of having up to four children. Yes, some people raise five or more (I see you, Ms. Montana), but when the family gets to be that large, you’ve probably figured out some economies of scale to reduce the impact of the fifth, seventh, or thirteenth child.


PoF Cost of Kids



I can hear the grumbles already. You don’t like my numbers or assumptions. Your third child was a girl joining two boys, and now you’re buying outfits for an American Girl doll that cost more than the outfits for your actual American girl. Or your four kids sleep on two bunkbeds in one room and your family doesn’t do birthday parties.

I’m well aware of the problem with assumptions, so I’ll let you  enter your own numbers (or best guesses) into the embedded spreadsheet below. Of course, these numbers are not meant to be precise; they exist to give us a rough idea.


If you’d like to download this, along with about ten other calculators I’ve built, they’re available to subscribers in the form of an Excel file. Sign up, download, and if you don’t want to hear from me again, you can unsubscribe right away. No hard feelings.


The Impact of Raising Children on Financial Independence


Now that we’ve estimated that you’ll be trailing your childless selves from a parallel universe by something in the range of a little over $100,000 to a little under $3.9 Million, we can better understand what that means for eventual financial independence.

Once again, several variables are at play. The most important are the opportunity cost of having children based on the table above, and your ability to earn and save money to cover that cost.

We’ve been down this path before, and as I often do when faced with a question like this, I constructed a spreadsheet to give us the answer. A few tweaks to the Time to FI Calculator  gives us the Added Time for FI Calculator. Enter your monthly savings, the additional money anticipated to raise kids from the “opportunity cost” colums above to determine how many additional years it will take to achieve FI.



Today, we’ll use it to calculate the additional time required to cover the costs of raising children, but it can just as easily be used to calculate how much more work is required to cover any expense with a fixed or time-limited cost. Ongoing costs are pretty easy to calculate, too. Simply increase your desired annual spending by the anticipated cost of your season tickets, club membership, or first-class upgrades and you’ll get the answer you’re looking for from the Time to FI calculator.

To get a better idea of how much time will be added for a variety of families, we’ll look at a few examples:

  • Moderate Spenders with 2 kids saving $10,000 a month
  • Frugal Family with 2 kids saving $1,000 a month
  • Dept of Ag Family with 2 kids saving $5,000 a month
  • Upper Crust Family with 4 kids saving $25,000 a month


Added Time to FI


The first family is not aypical of a high-income professional family pursuing financial indepence. They’re “supersaving” $10,000 a month, spending moderately, and having a couple kids adds a few years to their financial independence date.

The next family is a middle class family raising kids as frugally as possible, with expenditures far below the Dept of Ag’s estimates while saving $1,000 a month. The kids change their time to FI by 11 to 17 years!

The third family might be a normal upper income household, spending in line with the Dept of Ag’s estimated cost to raise their two kids. Saving $60,000 a year, it will take them an extra 7 to 9 years to become FI.

Finally, the big spenders, who utilize private schools for all four children need nearly $4 million to cover the cost of those expensive kiddos! Fortunately, they earn plenty of money. By setting aside $25,000 a month, they will recoup that cost in 8 to 11 years.


Closing Thoughts


The financial implications of having children should not be the deciding factor when you decide whether or not to attempt to start or grow a family. Other factors should carry much greater weight. I know I explained that in the introduction, but I cannot stress it enough.

Despite the challenges, we would make the same choice to have children again. If they cost double or triple, I’d be willing to put in the extra time to afford them.


nickelodeon universe ride
these guys are happy to hear that!


These exercises are my attempt to give us a better understanding of the monetary challenges of pursuing financial independence while raising a family. FI looks entirely different to people with different habits, goals, and family structures.

The single, childless traveling nomad’s total needs might be met with less than $500,000. An upper crust family can require about eight times that sum just to launch a family of four. Achieving financial independence might take another $5 Million. Most of us will make choices that put us somewhere in between these relative extremes.

For me, using the calculators above, I’ve guesstimated that with two boys, I put in about two extra years of full time work to cover the cost of raising our children as moderate spenders.

Note that while that isn’t very long at all in the grand scheme of things, the time would be much longer for someone who doesn’t earn a specialist physician’s pay while saving about three-fourths of take-home pay. For someone saving and investing a few thousand dollars a month, a couple kids could easily delay FI by a good ten years or more.


A different, and perhaps better way to approach the equation, is to determine how much more you need to earn (or less you need to spend) to cover the annual cost of raising children. If you expect to spend about $16,000 a year on a couple of kids, that’s how much more you need to earn in after-tax money, or how much less you need to spend to reach your financial goals without affecting your timeline one bit.

Also, keep in mind that having children can be an incredible motivator to reach FI sooner. As you watch them grow like weeds as time flies by, you may be desperate to find a way to make life slow down before they’re up and gone.

Financial independence gives you the freedom to do that.



Do you have children? How many? Do you spend as much as the Dept of Ag says you will? Do your children factor into your future plans after reaching financial independence?

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87 thoughts on “Financial Independence With Kids: How Procreation Impacts FIRE”

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  10. Agree that children are a great motivator too. Not for FI but for RE. I don’t know that I would have RE’d except for twin girls I want to take to school every day and be there as well to pick them up. Hard to do with a doctor job, but easy to do once you are FI and decide to work on your encore career!

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  12. Great article as usual. We have 1 daughter who is now 15 months old. We spent significantly less than the average so far due to some fortunate childcare options and having a cousin one year older (hand me downs!). Though conceiving our daughter was quite the expenditure, around $100k due to infertility issues. Our main point of contention is figuring out our living choices when we reach FI while still having a school age child. Thanks for the spreadsheets!

    • Thank you, LLLU. That is one expensive conception, but you seem poised to start recapturing some of that back by not spending as much as the USDA thinks you will. Hand-me-downs are great. In some ways, we lucked out having two boys a couple years apart. Same clothes, same toys, ame movies, etc… We’d be spending more if we had a boy and a girl, for sure.


  13. Really interesting post. I like how you broke it down for different types of families.

    The cost of education is a huge factor expats need to consider when planning to FIRE, especially in countries in SE Asia. It’s easy to get a job to support yourself, but as soon as soon you realize international schools cost $30,000 USD per year the picture can change dramatically. Many expats who don’t have schooling for their kids included in their benefits packages or who can’t afford a decent school will often make the move back home for the future of their kids.

    Thanks for putting out some real numbers.

  14. I have 4 kids under the age of 10. Having kids certainly has impacted my FIRE plans. I want to pay for their college which will cost me $700,000 for in-state or $1,700,000 for private. Trust me, I ran the calculations.

    Thankfully we have decent incomes (both of us are in healthcare). I”m on track to retire early and to fully fund their in-state education…private college is a whole other story!

  15. I read your post with alot of interest.

    We have 2 sons (5 and 3), and although we are a moderate to frugal spenders, the single most expensive aspect of bringing them up has been education. As a result, we’re ever more fired up about FI and continually seek new ways of making the nearly impossible possible.

    We live just on the outskirts of London and bought our home at a decent price, but still get the “London effect” from a house price perspective. So our house value has risen alot whilst we agressively paid down our mortgage.

    Living where we do though came at a slight cost because the primary schools near us aren’t as good as we would like. So we have gone down the private route and boy is it not cheap!

    We spend circa £14,000 per annum on our first son, and not had to pay anything for our second son (as he has had free childcare so far…little arrangement…..). However, we will in 2018 have to start paying private school fees for our second son as he moves to Primary school.

    Here’s the thing, as first generation immigrants to the UK, private school is a kind of hedge or insurance. We often feel we have much catching up to do, and see it as a massive investment!

    So our approach is what you suggested in the latter part of your message…. We are only hoping to fund private Primary education (as we live near an outstanding Grammar school- basically state schools with private school standards) and the kids will hopefully ace entrance exams for the Grammar schools for Secondary school.

    Day in day out, we are running side hustles that go towards funding education for the kids, whilst also aggressively paying down our home.

    The side hustles also contribute towards our Freedom Fund, which is untouchable and working towards FI.

    Having considered the costs and related opportunity costs of having children, we would never have considered not having them because of money. We’re really blessed to have our sons and money comes nowhere near being the key determinant. I’d definitely recommend having children for a tonne more reasons.

    However, we’re likely to stop at 2 kids not primarily because of money but more because it’s alot of work!! My wife, however, has other ideas 🙂

  16. We have a 6 year old and a 4 year old. While they do cost money, and we have one income because my wife is managing the household, I’m not totally convinced that our current net worth would be higher or lower without the kids. I think overall they bring a good reason to have a healthy investment and saving ratio. They do get $1,000/month 529’s, and Disney is pricey. On the other hand, we do live in the mid-south to be close to family which has a much lower cost of living than living in some prime dink location. We eat at home nearly every night instead of going out on the town, to get the kids in bed. We’re not jet-setting to Europe, Southeast Asia, or Nepal every 3 months, which is what we’d be doing sans kids. So, maybe, our personal situation makes us actually richer with the rugrats. No way to know.

    • Excellent points, all of them.

      Our kids are now three years older than yours, my wife stayed home to raise them, we’ve been funding 529s since infancy, and we’ve done the Disney cruise. We’ve also taken them to Paris (and Disneyland Paris), but their presence in our lives does give us good reason to save and invest wisely to provide for our collective futures.


  17. My wife is pregnant with our first child, and money issues is one of the many areas we are nervous about. We’ve been putting a lot of money aside for expected & unexpected expenses, so that helps with the nerves some. Right now we’re trying to figure out daycare – it seems that it might cost over a grand a month.

  18. Plugging my numbers into the USDA calculator says that our three kids should have cost us nearly $44,000 a year when I was working my full-time job. Given our annual budget of $60,000 that means my wife and I are as good of bargains as you and your wife.

    Sure, kids are expensive, but I agree with your sentiment from the end of the article – it’s worth it for me. Kids aren’t for everyone but I wouldn’t have let money being a factor in choosing whether or not to have kids unless I had been in a state where I couldn’t have responsibly fed and sheltered them.

    There seems to be a lot of chatter these days about how having kids is a “bad” idea when it comes to money, but I could say the same about any lifestyle choice that costs money.

    Travel is expensive, so it’s bad for early retirement.
    Eating organic is expensive, so it’s bad for early retirement.
    Giving to charity is expensive, so it’s bad for early retirement.

    We’re doing all three of these and have kids. Sure, it’s slowing down our progress toward FI, but if I had to give these 4 up, what enjoyment would I have? What would be my drive for getting to FI? Hitting FI but missing out on the stuff I love doesn’t sound very appealing!

  19. The title caught my eye because it’s something impacting us now. We’re both early 30’s and financially independent. It’s great that we don’t have to work and can raise a family, but our dream is to travel.

    Perhaps it’s a sub-niche of FIRE but it seems that traveling with children seriously increases the income you need to stay financially independent while living that lifestyle.

    • It could, but it depends a lot on how you travel. Taking frequent short vacations is costly. Taking longer trips, alternating between low cost and reasonable cost of living areas could cost less than staying put. Go Curry Cracker does this well.


  20. I think that kids definitely put a damper on early retirement but as someone mentioned they can really ignite your motivation towards FIRE.

    And there are definitely variables. We just came back last night from picking up some more hand me downs from my sis in law and I felt overwhelmed by the amount of stuff! They must have spent a lot- Jolly Jumper, Exersaucer, high chairs…etc.

  21. Our kids are a net positive. They make us work harder and be more responsible. Plus, you get paid more when you have kids. Not sure if that’s fair, but it’s true. So I tend to take all the published reports about kids costing $250K and ignore it. No private school and no extravagant parties and hoopla for ours – just a lot of love and learning. So friggin’ old fashioned, I know…
    -Farmer Cubert

  22. I think there’s another angle here that you didn’t address. The main effect I see from kids on fiRE isn’t the money, but the fact that if you’re a high-income professional and thus aren’t having kids at 20-25, you’re going to have kids around the house well into your 50s if not 60s. Kids in high school aren’t going to be so cool with you retiring to travel the world while they want to be sticking around to hang with friends and pursue their various sports and clubs and activities. So it’s the limitation on what you can do with FIRE more than whether you can actually reach that status.

    • You might be surprised at how they respond. At first it’s a struggle but as they see the world and what is really important in life they don’t want to hand around with kids who do nothing but stare at their phones and post on Instagram.

  23. Great post.

    I am at the tail end of this journey with kids ages 21 and 19. My experience is you missed whole classes of cost. What about a car? What about increased insurance? What about tires and that $80 10K mile oil change? Ah yes gas lets not forget gas. What about electronics? Camera, computer, cell phone, cell phone service? I won’t let my kids out of the house without a cell even though they are adults. Allowance? My kids get $300 a month each. It has given them great experience learning how to manage money and the freedom to save for what they want like clothes, shoes, latte, purple hair color etc. Fortunately no tats.

    You might say “get a job!” I had one or two simultaneous part time jobs in high school, and a job as a janitor in college and delivered pizza on the week ends. I learned a lot. It’s good advice. To have a job effectively requires a car. Jobs aren’t all that easy to get these days. My kids cashiered at a grocery, and each of them started photography and baby sitting businesses beyond their cashier jobs. Does the old man’s heart good to see their initiative. Entrepreneurialism is something I encourage with them so I supported that. I sent my kids to summer camp, church camp, and eventually Europe. Let’s not forget concerts and prom and so on and so on and scooby dooby dooby. Ah weddings did I mention weddings?

    What I did was to set up UGTM accounts and fund them when they were 3. I put 15K in each account and added 2K per year. I put it in Van Guard funds but I wish I had put it in BRK.B. Yes I know the money is theirs when they are 18, but bad Dad that I am I never told them about the money. I just used it for their benefit. Summer camp? No problem. iPhone? I think I can cover that DD. My oldest spent the summer in Italy and Austria paid from this fund. She had a blast.

    The advantage of it is compounding. Things don’t get really expensive till they are juniors in HS and then through college. That’s a lot of years of compounding. 15K plus 2K per year at 6% for 20 years is 120K. That’s a lot of money to use that does not impinge on my cash flow now that I’m fully retired and it can be used for anything not just education. When they graduate college if anything is left, such a nice graduation present. The thing with this fund is you don’t have to cover 45 years of retirement, only about 6 years of late adolescence to young adulthood. (72 months).

    How well did it work? My oldest has 1 more semester and 18K in the bank, plenty to get her through. She decided to live on campus so I didn’t have the car expense for her. My youngest is in her first semester and she commutes to a close by university so she has car expenses but so far it’s working fine.

    My funds were VB, VEU, VTI, and SPLV. If I was doing it today I would choose 2% QQQ, 7% BRK.B, 1% GOOG, 7% AMZN, 83% VBMFX. I ran this through an efficient frontier calculator and the return was 6.4% with a SD of 4.1%. I would re-balance according to the calculator’s recommendation as the decades progress.

    I didn’t fund a 529B. My state has prepaid tuition at any state school, 120 hours tuition and fees. Note it pays 120 hours not 4 years. Engineering degrees are typically 5 years these days or maybe 6 if you co-op. My advantage is this is guaranteed and inflation protected, no question marks. My cost was 22K per kid, purchased at age 2, and a thoracic aneurysm could let go and they would be taken care of. I paid for a lot of their lives out of pocket while I was employed and they were young. Now that I’m retired the UGTM is very handy

    This plan limits their choices somewhat, they ain’t going to Harvard, so what? Math is math, chemistry is chemistry at the undergrad level. They get a debt free high quality education, I don’t get bruised and I have peace of mind in the meantime. I’m pleased with the women they have become and that’s the real bottom line. Money well spent.

  24. Awesome and thorough breakdown! I don’t have kids and don’t know if I ever will, but I know it has set some of my friends back big-time financially. Of course, they’re pretty spendy anyway, but do they really need a stroller that can negotiate a 4X4 obstacle course and take chains on the wheels?

  25. Thanks for the analysis. I have found that as my kids get older (one in middle and one in high school) they become more and more expensive. Tutors, trips, camps, etc… not to mention the looming college bill around the corner.

    The private/public school decision is more than just financial. We have done both types of schools for various reasons. When our son moved from private middle school to public high school, we made sure that every dollar that would have gone toward his tuition went straight into his college account.

    We try to teach our kids trade offs which also helps us make prudent financial decisions. For example, we waited 11 years to remodel our home until we had the cash to do so and to do the job once and for all. We walked our kids through the process. There were decisions we made based on our kids and as a family. We told them that if we chose to remodel that room (bathroom for example) it would mean that it would come out of their camp budget. This helped them have skin in the game and helped them realize the impact of the family’s decisions.

    Another important point is that when you have dependents, it requires more insurance and more planning. Insurance, wills, etc…

  26. Thanks for this analysis – as a new parent, I enjoyed your thoughts on this. so far, our expenses have been kept in check for the most part, but that’ll be changing as soon as we start dolling out huge wads of cash for day care in our high cost of living area.

    • Thank you for the comment, Freedom Fighter. I’m guessing that paying for daycare is still financially advantageous compared to one of you staying home?
      For us, it probably would have been pretty close to a wash, especially once we had two little ones. My wife and I are both grateful that she was able to make the choice to stay home, but for some people and some families, I realize that’s not a tenable option.


  27. I have one daughter and she is three years old, so I don’t know how much she is going to cost over the long term. What I do know is that until she came to be I never spent a second thinking about my finances. Given that she is one of the big reasons that I started learning, investing and wanting to be able to FIRE, I would say that my ROI for having a kid was pretty damn good.

  28. Great analysis. I have two boys and they totally blow up my budget. We send them to private school, but if I had my way they’d go public just like I did. Unfortunately, my wife has strong feelings about this so if I want to stay happily married, I have to pick another battle. The compromise is they will go to public high school.

    • I hear ya loud and clear. Money is what gets people into arguments, and parents arguing about their kids expenses is a common one that gets tossed around.

      Be cautious: private elementary school can potentially lead to private high school as well!

    • In my experience, parents who grew up going to public schools tend to prefer public schools, just as privately educated parents have a preference to do the same for their kids. I guess we like to stick with what worked for ourselves. There are places, of course, where pretty much anyone who can afford it, and some who probably can’t, will send their children to private schools due to the dismal reputations or relative safety of the local public school system.


  29. Don’t forget the impact that having children can have on the mom’s income potential. Many physician moms I know take some sort of income hit, either due to need for part-time (still 40+ hours in some fields) work, jobs with more flexible schedules, or being passed over for promotions (the reason given will never be due to kids, of course). Many high-income women are married to equally ambitious high income dads, who don’t want to take the primary parent role. I agree that money should not really be a factor in deciding whether you have children–assuming you have enough to meet their basic needs.

    • Excellent point, Ann. Even the woman who has a stay-at-home spouse to manage the household will have the same issues with maternity leave, promotions, etc…


  30. Great article. Very thought provoking. As we don’t have kids, yet, we have put some thought into it. If it delays us a title, so be it. Although we are probably further down the path than most folks looking to have kids simply cause were older.

    Regardless, should it happen. I think its a great opportunity to dial back. Sounds like a good reason for a sabbatical, or a part time gig for a couple years while watching them grow.

  31. Love this article, PoF. It’s eye-opening to see the range of costs people spend on their kids. It was particularly interesting to see the extra $39,000 Dept. of Ag figure is almost as much as our entire budget back in the US!

    Prekids we were about $3,000/month. Before we left for Equador with two kids we were about $4,000/month. So, that puts us in the frugal camp it looks like. As an aside, in Equador we’re back down to $2,800/month – and that’s paying for private schools and living it up.

    I definitely fall into the camp of being more motivated for FIRE because of kids. It would be easy for me to stay completed sucked into a career and projects, but family has inspired me to be more balanced.

    • If the average household income is somewhere around $57,000, it doesn’t seem plausible that an average family is spending half that or more on a couple kids. And economies of scale need to be considered. Our poor second child doesn’t get a lot of new stuff. I was a younger brother, too, so I know all about hand-me-downs.

      Ecuador, you say. We’ve got it penciled in for our spring trip in 2018. Cuenca, here we come!

  32. Thanks for the great analysis. With a healthy doctor income, cost per se hasn’t been a major factor in the kids decision for us. Our main concern has been to live within our means and avoid “spoiling them”. We raise them like we were raised (my wife and I were not wealthy).
    We have 2 kids and spending more time with them has also been the main reason I have been looking at FI. They have been motivation to work less due to the freedom provided by FI, but they are also the major reason for me to not “RE”. I want them to see me working in my career, but FI allows me to do that with more moderate hours, so I can spend time with them and on modelling a more well-rounded lifestyle (medicine has a nasty habit of consuming people). Kids with school (and in our case dogs and a guinea pig) also changes the oft-cited lure of extensive travel for us. I believe WCI investor wrote about that just recently. I like his idea of some single parent adventure trips. Our solution has been that I bought a 10yr old motorhome (a bus basically), renovated it, and we use that to travel as the whole zoo in summer and around school breaks. Just booked Disney again for March break yesterday!

    • I love the idea of your bus / motorhome. One thing about being a physician, at least in the procedural specialties, is that you’re pretty much tied down to a location. Of course, you can roam doing locum tenens, but it’s not like some jobs where people can work from home or anywhere. Telemedicine is changing that for some, but not for anesthesiologists!

      School can also keep you tied down, but online options are expanding. I heard a proposal to eliminate “snow days” in Minnesota and have distance / online learning on those days instead. The world is changing fast!


  33. Financially, kids are like a Whole Life policy: pay a lot up front, and get a small benefit at the end. My four daughters are amazing, but I also know they won’t let me starve on the street corner, either.

  34. I don’t know if I’d do it if they cost THREE times as much… jk 🙂

    I wonder how parents feel based on the age of their kids. Like toddlers vs. teenagers vs. adult and out of the house – I suspect my feelings won’t change (I’d pay up to 5x!) but it’s hard to see because I’m living through it. Maybe only 4x if they didn’t nap… 🙂

  35. I did a post a while back where I crowd sourced peoples thoughts on the more broad impact of kids. The interesting thing was how many attributed a change in their financial direction to the presence of kids. Ie it gave them the kick in the keister to start being more financially responsible. It’s hard to measure that in a spreadsheet.

    From an actual cost perspective we’re no where near the above in direct terms. But it’s also hard to qualify what is an expense because we have kids and what is not. Ie kids permeate your every financial decision once they arrive.

    • I hear you FTF. They give you a great reason to challenge the status quo and live a bit differently. I know so many families where the parents get home sometime between 5 and 7 in the evening and scramble to get the kids fed and off to bed at a reasonable hour. That seems like a crummy way to spend most days of a 20+ year timeframe it takes to raise a couple kids. That’s not us, but if it were, I’d be desperate to change our ways.


  36. “Despite the challenges, we would make the same choice to have children again. If they cost double or triple, I’d be willing to put in the extra time to afford them.”

    Amen to that!

    We have one daughter. She’s in her senior year of college and we’ve already started drafting our 2019 budget with her totally on her own. It’s going to be like having an additional income – without the work. 🙂

    While it took more effort, having a child didn’t prevent us from achieving FIRE. We reached it at age 44. A big boost was selling a business and doing a SERIOUS downsize to minimize our expenses. Even without those we were still on track to retire in our late 40s.

  37. The joy of kids? Priceless!

    The big ticket items for kids tend to be (1) time to shuffle them to activities..etc and (2) whether you go nuts on their educations. I think that most parents are willing to spring for #1, but there seems to be wide variation on how much parents should (and can) spend on education.

    • Yes, there is clearly an immense time commitment, and if you translated that into money at our pay scale, the cost per child would be in the millions! It’s quality time though, right? Maybe not the shuffling kids around part, but time with kids in general


  38. RogueMD I’m interested to see what you have to say about the incremental cost of the third child. I’ve got three boys and I don’t feel the third one financially as much as the first or second. Maybe if he was a girl as was hoped by his mother we may have felt more of a difference. As it was he settled into our household quite nicely.

    One thing I could not have budgeted for was having a child with special needs. My oldest’s issues did not become apparent until we had the the third. If we had known I’m pretty sure we would not have had a third and possibly not a second. Partly because of money but mostly because of time. Difficult to know how life would be without three kids now since we are so deeply entrenched in being a family of five.

  39. Fantastic post, great to see it all broken down like this, PoF! Struggling with the issue of private school myself. I absolutely hate the idea of paying that much so my daughter can fingerpaint but at the same time, LA public schools are generally garbage.

    • It’s tough to have to make that choice. We have great public schools where I’m at, and we also will have the flexibility after we’re FIRED soon to choose where we want to spend the boys’ high school years. Quality of public schools will be a primary factor, I’m sure.


    • Have you ever considered home schooling? There are so many online programs and resources available! Your kids can also learn about real life instead of what people think matters in school.

  40. What about the cost savings of having kids. They can mow lawns, put together furniture for you, provide the labor for moving couches, etc. That easily can save a thousand bucks a year!

    Nice post. Kids are costly and those that don’t want any def have a advantage in the fire game.

    • I earned my keep as a kid by knowing how to set the clock on the VCR. Only one in the house with that ability.

    • Kids ARE expensive, but some of our other expenses — dining out, travel, etc. — went way down after having them. 🙂

      • I hear you. But before long, you’ll be booking round ntrip tickets for the whole family and ordering full meals for the whole family at the restaurant.

        For better or worse, they don’t stay small forever!

  41. Fascinating! I don’t have kids but as a 27 year old lady society has been assuming for awhile now that I will have them at some point. They’re probably right so this is a good article to bookmark for that some point in the future.

  42. I agree with Lena that if daycare is necessitated, the calculator is pretty close or undershooting at least the first 5 years. We spent about $2k/month when both kids were in daycare and that was for Primrose, so not the cheapest daycare, but not a fancy private one either. For perspective our mortgage is $1900/month. Now that one is in grade school and the other will be next fall, we’ve been diverting those “extra” freed up funds into savings. Of course, this was our original plan and part of the reason we moved to where we did.

    We didn’t want to be like some of our friends and still be paying $1k/mo per kid for private grade school. By the time our youngest gets to kindergarten next year, we will have spent well over $120k on just daycare… Sickening, but considering both of our incomes during that time, it still paid out for paying for daycare.

    You’re right, kid expenses are very personal and dependent on your specific situation. Once the daycare is gone, they’ll be back into a WAY cheaper cost per year category, for us anyway.

    • I agree with this. The daycare expense are what “kill” us right now. We have two in a Montessori school/daycare. While not the cheapest option, it is far from the most expensive. It costs us $500/week. We are also in one of the highest daycare costs in the country. Once the kids start getting into school, it makes a significant change in the budget calculations.

    • Wow — those daycare costs really pile up!

      Seriously considering shutting down the blog and opening up a daycare instead. Physician on DiaperDuty, or something along those lines.

      Cheers to grade school!

  43. Having my 3 kids is the very reason I’m working towards FIRE! But yes, the costs of having them will be delaying the time to FIRE.

    I would say that the Dept of Ag’s estimates are pretty spot on during the children’s early years IF there is a need for childcare. Then as they enter public school I would say it significantly drops annually. I’d say we’re very similar to you as being moderate spenders on an annual basis.

    • Daycare costs can be brutal from what I hear. We haven’t had any, but on the other hand, we chose to be a one-income household with two highly educated parents. There is certainly an opportunity cost to having a stay-at-home parent that doesn’t show up in those statistics.


  44. PoF — you stole the guest post idea I pitched to you! Well, not completely.

    That DoA calculator is fairly useless IMO. The biggest delay for me will be helping with higher education (529 now and potentially using cash flow later when in college). That’s also the thing that will impact my retirement date the most.

    PVF — I’m awake and working in the ER. But my wife is probably up with one of the kids.

    • I’ve got you down for a Christopher Guest post at some point, but I don’t recall another pitch. I can assure you I’ve had this idea in my drafts folder longer than you’ve been a blogger. I put off writing it for a long time, because it’s a big topic!

      As such, there’s much more that can be said about the cost of raising kids — Vagabond MD wrote a nice piece here on the subject — so you’re welcome to submit another.


      • 🙂 I’m being a bit facetious.

        However I pitched a post to you awhile ago on the incremental cost I incurred after having a third kid, something I’ve been thinking about since before he showed up (14 months ago).

        I’ve also put off writing mine as well because as you say it is a big topic. It’s inching closer to the top of my draft pile though.

        • Gotcha — that sounds familiar. Lots of non-financial implications of being outnumbered, too. Again, probably something I said before. 🙂

  45. Great topic, thoroughly written.

    There can be some eventual ROI, even on a strictly financial analysis. I don’t think you will need it due to your financial savvy. My father ended up destitute near end of life. I paid his housing and living expenses for years. I thought of it as a small price to pay back for all he did for me.

  46. Hmm. Wonder how many of us middle of the night commenters are up with non-sleeping kids. Thanks, daylight savings time change.

  47. Very good analysis backed by numbers.

    One extra thing we have to consider is the reduced income during mat leave especially in Canada since it’s for 1 year, soon to be 1.5yr.

    • That would be mostly optional, though, no?

      Not saying it’s a bad option, but I would hope you’re not forced into a lower income when you have a child.

      Cheers, eh!

      • I was chatting with someone today on this topic (more about after mat leave though). They were mentioning how for a number of people they knew, they left their job and took a year or two off to raise kids. When going back into the workforce, they were at a disadvantage relative to their peers who had worked during that time frame.

        This probably has more variance than spending though. The case when someone has kids, takes a year or two off to take care of them, then has trouble getting back into the workforce altogether can have a big impact on lifelong earning.

        • In Canada your job is guaranteed for that 12/18 months mat leave but yes, you might still lose out on promotions and raises depending on the company culture / internal politics even though there are laws against that.

      • Yes, it’s optional but most people take the full 12 months (soon to be 18 months). It’s one of the reasons the PM won the elections, it was one of his selling points ?

      • Yes, but what you’re entitled to by law and what happens in the real world can be two different things. I have a male friend who took his legal maternity leave when his wife had a baby. When he returned to work there was a lot of animosity from his coworkers. It got so bad he ended up finding another job. That was a government position too!

  48. With our first child expected in the next few weeks, this could not have come at a better time. I love the detail, as always! Health insurance premiums for 2018 on the family plan already jump to $1,500 per month. So the effects of a child (from the cost side) are already showing on the budget. Not the mention his nursery is already cooler than any other room in the house (I blame his mother and HomeGoods) .

    Thinking about making FinCon a family trip next year as well, I have never been to FinCon but I had intense jealousy during FinCon 2017.

    Thanks, PoF!

    • I hope to see you in Orlando next year, but in the meantime, Congrats on your coming bundle of joy. Enjoy the good and the bad and everything in between. They’re only little once!

  49. I have three boys, and of course supporting them costs more than if I had no kids. But like you, I’d do it all over again even if it means working longer. I also have very high college funding goals, but beyond that, I don’t spent a ton of money on them. Food, clothing, activities and supplies don’t cost that much in the grand scheme of things.

  50. Nice analysis, as always. I might add that lack of children also relieves the aspiring early retiree of the burden of providing for dependents, should one meet an untimely end. If I didn’t have kids, I would question the need for a life insurance policy. I would also be more apt to retire with a 4-5% withdrawal rate, rather than 2-3%. It’s easier to take a chance when it’s only your own butt on the line, and not your little angels’.

    To your final point, the birth of my children—especially as the older one becomes a walking, communicating hurricane of fun—has been a huge motivator. Not only do I want more time to spend with them, but I feel the need to fill in the gaps in my knowledge as much as possible; parents are, among other things, the primary teachers of their children.

    • Good points, Dr. C.

      I’ve missed out on a lot of time with the kids due to my work schedule, and I’m excited for the opportunity to eliminate those frequent conflicts.



  51. Good article doc. I have a 11 year old and can now say with confidence that USDA’s figures are way off, even adjusted for our profile. I think their figures may discourage prospective parents. For real data and experience, see here: Raise a Child, Not a Fortune!

    • You can spend a lot or a little. Part of the problem with any data that uses the mean average rather than median is that the numbers can be skewed to the right / higher end. Since a portion of society utilizes private schools, the “average” child has a part of that included in their cost. But many won’t incur that cost.



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