What It Really Costs To Raise A Baby!

Family taking a walk down the street, close up

How much do you think it costs to raise a baby in its first year? According to NerdWallet, for a family with a $40,000 household income (the U.S. average was $55,775 in 2015 per the U.S. Census Bureau), the cost can be more than $20K! And for households at the $200K household income and above, that amount can be more than $50K. For example, diapers alone can run $900+ and formula over $2k in the first year, alone.

If you are planning to start a family, it’s a good idea to start saving at least two years in advance. Here are some additional money saving tips:


Plan ahead! Understand your benefits like maternity coverage and insurance deductibles. Then establish a separate savings account and set up direct deposit from your paycheck so that you never “miss” the money.

Take advantage of Roth IRA and 529 college savings plans, which enable you to save money tax-free. Some employers will even match your IRA contribution.

Baby Gear

Don’t be afraid to purchase used gear or accept hand-me-down gear, with the exception of course, of car seats. Never buy a used car seat or accept a hand-me-down car seat unless you are 100% certain of its history, meaning that it has never been in a car accident and is not expired or recalled.

There is a tremendous amount of baby gear for sale in your community – check Facebook mommy boards and Craigslist. You will often find gear that is well-maintained or only “gently” used. Squeamish about second-hand gear? You can always clean second-hand baby gear yourself or have it cleaned by a professional service like Tot Squad.

Look for convertible car seats that can grow with your child and offer the greatest value. The Rainier from Diono, for example, can accommodate your child from 5lbs to 120lbs.

Beware of “On-Demand” Culture

Lastly, if you are planning to have a little one, take small steps like curbing your spending habits. We live in an “on demand” culture that makes it all too easy to spend money, freely, but being conscious of this is the first step towards saving money. An evening out can be a considerable expense once you factor in childcare, transportation, food, entertainment, etc. If it is an option, living near family that is willing to help with occasional child care can reduce expenses.

Jennifer Beall Saxton is the founder and CEO of Tot Squad, a trusted partner of retailers, stroller brands, and car seat brands, that offers car seat cleaning and installation, stroller cleaning and repair, and other baby gear cleaning services. For more information on Tot Squad, visit nyc.thetotsquad.com!