A lifetime of costs
Online source: NATSEM Report, Income and Wealth Report. Issue 33, May 2013.
To determine the cost of raising children from birth until they finally leave the family home, we have constructed three typical families. In these hypothetical but typical families, all the parents are of similar ages and each family has two children, two years apart. All have their first child when the father is 31 years and the mother is 30.
The families differ, however, in the assumed education levels and earnings of the fathers; in the education levels and workforce participation of the mothers; and in the families’ use of education and child care services as their children grow up.
In essence, Family A portrays a typical ‘Aussie battler’ family, where both parents did not go past Year 12 of school; where the mother works part-time after the youngest child reaches the age of six, and where both children attend government schools and do not go on to university.
Family C portrays a family at the other end of the education and work spectrum, with both parents having a university degree and working full-time and both children attending private schools and then university.
Family B fits in between the other two, with both parents working; the mother part-time once the youngest is in primary school and full-time once high school is reached. The children attend government schools and then go on to university. Family income and the costs of the children are very different for these three families. Full details about the assumptions made about each family can be found in the Technical Notes at the end of the report.
Parents’ income profiles for each year they spend raising children have been calculated from the incomes of similar households in the 2009-10 Housing Expenditure Survey collected by the ABS. When the costs of raising children were added up across the years, we found that they will cost our typical families between $474,000 and $1,097,000.
