The Stay-at-home Parent
“Do you work or stay at home with the kids?” That hair-trigger question has set off many arguments in the decades-long debate over the economic value of the stay-at-home parent.
When you add up the value of such services as chauffer, cook, nose wiper, nurse, teacher, sibling referee, housekeeper, disciplinarian and comforter, it’s a pretty important career.
But what is the job worth in dollars and cents? Though estimates vary widely and the question may never be settled completely, there have been several recent efforts to realistically quantify the numbers based on some reasonable assumptions. The most comprehensive study comes from joint research conducted several years ago by University of Utah and Cornell University.
According to this study, the annual value of household work from married-couple households comes to $20,724. This average is fairly steady regardless of the number of children or household income.
That may not sound like much. However, it adds up to better than $1,700 a month. More to the point, when it comes to raising a child from birth to age 18, that $20,724 a year translates into a total expense of nearly $375,000. The chart below shows the simple calculations, and note that this does not even factor in inflation or other variables:
Total cost to raise a child to age 18:
|
Age youngest child |
Total value |
|
0 |
$373,032 |
|
1 |
$352,308 |
|
2 |
$331,584 |
|
3 |
$310,860 |
|
4 |
$290,136 |
|
5 |
$269,412 |
|
6 |
$248,688 |
|
7 |
$227,964 |
|
8 |
$207,240 |
|
9 |
$186,516 |
|
10 |
$165,792 |
|
11 |
$145,068 |
|
12 |
$124,344 |
|
13 |
$103,620 |
|
14 |
$ 82,896 |
|
15 |
$ 62,172 |
|
16 |
$ 41,448 |
|
17 |
$ 20,724 |
Example: If you have a 10-year-old child, the total estimated cost of caring for that one child for the next eight years (to age 18) would be approximately $165,792 ($20,724 X 8). However, if you have a newborn, a six-year-old, and a 10-year-old, the time span between the time when your eldest was born and your youngest child reaches age 18 is 28 years. The total estimated cost of raising your three children would be approximately $621,720 ($20,724 X 28). This is also the “replacement” cost if the adult caretaker should die.
Note that these numbers are averages based on one study. There are many factors and variables to consider.
The bottom line: If you or your spouse stays home for hands-on child rearing, congratulations. Your job is pretty darn valuable in terms of both emotional currency and dollars and cents.
So, don’t buy into that slam line: “Oh, you don’t work. You’re a stay-at-home parent.”
* * *
Want to learn more about how to manage your money and your life? Check out The Back to Basics Book of Money! A Couple’s Guide to Financial Peace. The book contains 10 valuable Couple Money Skills. Plus, the Back to Basics Book of Money Workbook (which dovetails with the main text) offers 31 practical, hands-on Wealth Builder activities that can help you and your partner build financial and domestic stability. Both the book and workbook, which retail for $31.98 plus S & H, are available at the Family Finances Conference Center website for $27.99 total.
The Family Finances Conference Center tailors programs to the unique and individual needs of client organizations and their members and employees, based on the principles of the book and workbook set, The Back to Basics Book of Money! A Couple’s Guide to Financial Peace.
For more information, contact me at the Family Finances Conference Center by email (john@b2bbookofmoney.com) or my direct phone line (920-559-3722).
John Ingrisano
Director
Family Finances Conference Center
204 Lakeview Drive
Algoma, WI 54201
(920) 559-3722
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