How Much Do Kids Really Cost? #075

expenses that we put towards our kids. Yeah, Matt. And part of the reason behind doing this episode is because the government comes out with a study every so often that lets us know how expensive it is to raise a kid in this country, and usually the number just seems astronomical. And so yeah, we'll get into what the most recent number was and why we don't think it actually costs that much money to raise a kid. Yeah, Joel, But first I have a quick grocery or garden money

saving tip. You ready for it? You are the grocery master, bring it. It's not me, it's my wife. I'm gonna brag on her for a minute. So this afternoon she spent about ten minutes snipping and pruning some herbs that she purchased at the store. It's a plant in our garden. She's doing that to root them so that we can plant in the garden because it's spring now. And explain

to people what rooting me. Well, essentially, you take herbs and you snip them, you bring them in a certain way and you stick them in water and the root roots will grow out of the herb and it can grow into a plant if you plan it soon after, right, that's right, And so she was doing this today with the basil and some tie basil mint. We do it all the time with green onion, but you can also do it with lots of stuff like a regano, rosemary,

time sage. A lot of times those herbs at the grocery store, you spend three bucks for a plastic container and there's six sprigs of mint. Completely. But if you plant mint in your yard, it'll grow like crazy because mint is a weed. But it tastes so good delicious. You're gonna mint juelip or something or more into the beer.

But yeah, that's a quick tip though, if you're into gardening, like like we like to get into every now and then, instead of going to the home depot or lows or wherever and purchasing those herbs to plant, go to the grocery store and take a few of the branches that you don't end up cooking with are from a friend who is growing someone's right, man, And yeah, that's a good way to kind of kick start your herb garden.

Yeah that's great because, like you said, herbs at the grocery store kind of get outrageously expensive, So grow your own. But Matt, let's quickly tell folks to the beer that we're gonna be drinking while we do today's show. And this is another beer from Spindle Tap, second one this week. Pretty excited about this one. It's called Heavy Hands and it's a double I p A. This label is pretty cool, like eight bit kind of graphics, which goes along with

kind of our intro music. Yeah, I mean it's it's totally got the Nintendo Mike Tyson's punch out graphics on there, and the in the dude instead of wearing boxing gloves, he's got h he's got a little hops on his on his hands instead of gloves. And that's for good reason because this beer has a lot of hoppy goodness in punch. I love it. Guess we'll talk more about that at the end of the show. But onto the subject at hand, Matt, Let's get into this how much

do kids really cost? And that study that I referenced quickly at the beginning of the show is a federal government study this show and the and the last time they did this study was in two thousands seventeen, and it showed that kids cost an average of two hundred and thirty three thousand dollars from birth to age eighteen. So that's before we're even talking about college. A kid is gonna cost you pretty much a quarter of a

million dollars, which which is insane. That's thirteen thousand dollars a year and a little over a thousand dollars a month, and that's insane. Yeah. And I feel like every time the study comes out, every year that it gets released, it becomes water cooler talk like, wow, that's crazy, can you believe it? And I feel like it's inflated. And I feel like there are ways, Matt as parents, uh, that we can lower the costs of having kids raising kids.

So we're gonna kind of get into that today. Yeah, And so I mean that huge number, two thirty three thousand dollars that does raise the question should folks consider not having kids because they can't afford it, and that, honestly is a really personal decision. But here's the thing. If you do think you need to get your finances in order before having kids, make sure that you consider

the rising cost of health care. Specifically, I'm thinking of back when we had our first daughter, the cost of my wife's oh B was thirty dollars for the This is for the global maternity care for coverage. We recently checked, and that has shot up to over Man, that's at increase in four years. And the reason why I know that is because we're pregnant. Yeah. I was gonna say, I was gonna say, why were you doing this research, Matthew. Yeah,

so we're insane and we're having another baby. Man, so this is gonna be number four for the UH for your family. Yeah. And I don't know how one does that, but I guess what you'll find out, right, Yeah, I mean there's no choice at this point. Yeah, it's just crazy that both of us that we're both having uh, we're both having kids this year. It's gonna be a wild year for for the how to money fam for sure. He completely is. Yeah, I announced that that Emily is pregnant.

You know, a few episodes back, Matt, and congrats to you and your family. I mean that's awesome. Yea, man, thanks, I'm excited we'll have kids again close to the same age. They get to kind of grow up together and learn about their dad's weird money habits at the same time. So true. Man, So back to the subject, which is quite appropriate for for today, right, Yeah, I get announcement for this episode. Yeah, so keep that in mind because

healthcare costs are going up. It goes without saying. And I think we've mentioned this, Matt on a lot of other shows. Having kids is priceless. It's completely worth it. There's not much better. And I think that's why we're launching into having a third and you're going, you're biting the ball. You're going number four, dude. We're insane between you guys and us, Like we're gonna have seven kids between us. Yeah, it's crazy, that's not crazy. That's crazy.

But that's because it's really not normal. That's because it really and truly is so much fun. They're they're a blast. They keep you young, they teach you things, they make you laugh. There's so much fun to be had with young kids. You never stop laughing in such a worthwhile endeavor. If you're if you're interested in having kids, don't forget that they are also, at the same time, a financial obligation that you'll be paying for for a lot of years.

They're not like the sticker shock two U thirty three thousand dollar level costs. And so we're going to clarify that as we go through this show. But we do want to make sure that that we're able as parents to strike that balance of being caring, loving and providing while also not turning on the money's pigott and giving them everything we want. And I think that that headline number from the survey kind of can represent the way

that our society can tend to think of parenting. And we make all these changes in order to become the perfect parents and provide the perfect environment for our kids to grow and thrive. And just like those herbs that Kate planted, right, and she's growing into into little herb trees or whatever you call um, yeah, herb tree, but I think that's correct. I don't think that's right. But but either way, we're propagating, right, yeah, yeah, yeah, exactly.

But in the same way that you're taking those little herbs and you're and you're rooting them and you're going them into something. Our kids need a proper environment to thrive, but at the same time, they don't necessarily need a money's pigot that that provides them this quintessentially perfect environment

to thrive. So, just like anything else, if you're thinking about having kids or if you do have kids, finding a balance of where you can cut back in where it's necessary to spend those extra dollars, that's really important. So I'm excited a mat. I think we're gonna have some good stuff. So some good takeaways in this episode as we go through the cost of really having a kid. Yeah, man, And before we do, I want to touch real quickly

on that study, right. So it was last updated in Seen, like you mentioned, and it showed a wide range of how much people actually spent on a kid, and it ranged from nine thousand dollars annually and this is from a family that makes under sixty thou dollars a year to over twenty three thousand dollars and this is from a family that makes over a hundred and seven thousand dollars.

So what's so crazy about that is there's such range, right, Like, what that tells me is that in reality, the family that's only spending nine thousand dollars, well, that kid is still thriving and surviving based on the report, Like that's from a family that's making sixty dollars, Like that's how much I make sometimes because we have a variable income,

so it just depends on the year. But I guess what I'm getting at is the lifestyle creep families that tend to earn more, they're also spending more on their

kid as well, which is understandable. We increased the spending on lots of things, so it's interesting to see that the amount that we spend on our kids is not immune to that lifestyle creep and matt Before we get into specific one off items that we can kind of reduce our spending on and figure out how to lower the costs of actually raising kids, well, let's talk about

that study just a little bit more. And it actually showed that the most expensive categories when it comes to raising kids were the same as the highest cost of an average American monthly budget, and that was housing, food and transportation and it makes sense that as you add to your family, you're going to spend more in those areas. Yeah, So it's just important to note that this isn't just

some ridiculous survey. It's really taking into account normal, everyday spending categories for people and how those kind of tend to inflate when you add children into the mix. Yeah, man, I found that incredibly fascinating the fact that like those three things specifically housing, food, and transportation made up almost sixty two of the money that we spend on our kids, which is pretty much in line, like you said, like

with what the average American and spends. The only top category that stood out that was different that wouldn't be considered in an average Americans budget is childcare or education. Like you said, seeing those specific categories shows that there's creep and there's sort of this inflation that happens when you do have kids. And the fact is it doesn't cost two hud three three thousand dollars to have a

kid because kids are really expensive. It costs the average American two hundred and three three thousand dollars to have a kid. Because the average American overspends, it seems that that number is just indicative of the overall spending patterns that we see in our country today, completely man, And I think sometimes the sticker shock of seeing that survey released every year kind of makes people think, well, why do I want to have kids if it's so dangy expensive?

And so you know, I don't know you and I obviously we think kids are great, and we're having more of them because because we think it's awesome for our families, and and the more of the marrier, we kind of have that mindset. I don't know, all the worst stopping after this, so maybe the more the merrier up until the point. Yeah, but let's get into some of the specific costs and then break down those major costs to like housing, food, and childcare and transportation. We'll get to

that right after the break. All right, Joe, let's go ahead and start at the very beginning. We're gonna start at childbirth. Do you want to give your birth story real quick? Like? No, I do not wait my personal birth. What was it like a dark, stormy night when you came out of the womb? Yeah? I don't remember. Sorry, Okay, there's a reason that babies don't remember that. That's true. And so the cost honestly, it varies by state, and the average vaginal delivery is between five and ten thousand

dollars depending on where you live. For me personally, like, the most affordable birth that we had for one of our daughters was five thousand dollars that we had to pay out of pocket. And being self employed, this is that's obviously a huge disadvantage when it comes to healthcare costs. But the best deal that we've gotten was five thousand

dollars when we did a pretty good job planning. The worst deal that we got was paying around eleven thousand dollars, and that was because we were told that it was going to be more affordable if we pay hash upfront and kind of get the discounted self pay rate. Dude, that did not work out for us, no joke. Over eleven thou dollars and that might work out for you, but for us specifically, we had some additional expenses associated with that birth, over eleven thollars to have a baby.

That was a lot for us. Yeah, there's no refund policy either, so so much of it depends on the insurance plan that you have. Certainly, the out of pocket costs that you're going to incur when having a child depends greatly on the sort of insurance that you have, So if you are doing upfront self pay cash, that's

gonna be a totally different thing, right, Matt. And for the folks out there with employer provided coverage, that's gonna vary to to UH to a large degree based on how your insurance company works with in network providers and what percentage of your overall healthcare costs your employer chips in. The average price of both of our girls was right

around three thousand dollars. Fortunately, we have an f s A through work, and so I would Yeah, that's one thing that I want to recommend to folks is if you do have an f s A, to max out r f s A for the year that you're planning on having a kid, and that will at least save you taxes on that money that you're going to to pay for the birth of that child. So that's super helpful. Yeah, man, get that discount. And for us, for baby number four, we are actually, for the first time, I'm going to

be delivering at a birth center. So in the past we've always gone to a hospital with the O B that was associated with that hospital, and so you know they had an office there as well. But with a birth center, you don't go to the hospital. You give birth at the birth center and that's where the midwives are. It's off the beaten path a little bit. It's a little more, it's a little crunchy, it's little granola. But yeah, that's how we roll. And there's certainly some cost savings

associated with that as well. Because this baby was a little bit more of a surprise. We're in a situation to where we didn't have the best insurance set up for for this year to have a baby, and so again we're gonna be paying out of pocket cash only where our health coverage isn't gonna kick in, and so we're getting a cash rate and that's gonna include everything there at the birth center. And their way that they're able to keep cost down is that you don't have

a separate O B charge plus the hospital charge. Since the care and the delivery are both happening at the birth center, you basically are able to take those two expenses and roll them into one. I thought you were considering a home birth map. Now you don't want to wanna go that route. You know you, and I know somebody who actually did that. Very impressive, very impressive, And there's no way my life or I would actually be

into that. Freaked me out, man, same here, a little a little frightening, right, yeah, So make sure to at least know your options, whether a birthing center is a better option for you, know what kind of insurance you have, and whether you need to call around and negotiate upfront cash prices. And also if you have recently given birth and you're starting to get hospital bills in the mail, make sure to call in and reach out to someone

in the financial assistance department of that hospital. Many many hospitals are nonprofit entities, and so often they will forgive a certain amount of the costs that you've incurred for the costs of the birth based on your income level. So it's worth talking to someone in that department to see if you qualify, yeah or not even based on your income. Man. So we had firsthand experience with this with the eleven thousand dollar birth that I mentioned earlier.

Since that was self pay, we were billed directly and the in enthusiologist send us a bill for which was a nice surprise. And I did exactly that. I called them up and it was an individual group, and just by spending five minutes on the phone with him, they knocked off five bucks, no joke, five minutes, five bucks, and they were basically expecting me to go ahead and

pay that. But I kind of stuck on the phone for another ten minutes, just saying if there's any way I could get any more money off, and they knocked another five bucks off. Man, I got that bill from twenty down to by spending fifteen minutes on the phone. You sound like a guy Coo commercial for hanging with your antithesiologist. It was one of my proudest moments of getting a deal in and negotiating down to price. But but yeah, sometimes it doesn't even take you being in

a hardship program or something that's income based. It just takes giving them a call and telling them your situation. Alright, Matt, now you get the baby in arms and take taking that baby home. Well, you're gonna need baby stuff. You know what car seats, and you're gonna need diapers and all that kind of stuff. So let's talk a little bit about that. Specifically. When it comes to diapers, I feel like that's one of the main things that people

think about. Diapers are really expensive. And you mentioned at one point in a recent episode that diapers were in your grocery budget and they were kind of killing your grocery budget to a certain extent, And I feel like that's the case for a lot of folks. Diapers can get really incredibly expensive quickly. And so Emily and I we did cloth diapers for the first baby, and also we did it for our second child as well, and

we kind of petered out though towards the end. We kind of got tired of doing the cloth diapers, kind of pooped out there we go. I like it, I like it, Yeah, we we we did kind of. Uh so we're hoping to kind of revamp the cloth diapers on baby number three. They're certainly not as much of a pain as they used to be, you know, back in the back in the day, where they're essentially just held on by a clothes pin with like the swaddle

wrapped around them. Yeah, exactly exactly. So, yeah, they're they're not quite as bad as that. They've certainly improved to a great degree. But you're doing laundry every single day with cloth diapers because there's just a lot of pooh, and so if you're willing to kind of suffer through that, it can be a big monetary payoff. Oh yeah, it's

a substantial cost savings. I remember crunching the numbers with our first daughter because we were in the same boat, you know, we were trying to find a way to save as much money as possible. And the upfront cost is more when it comes to cloth diapers, but in the long term it's significantly more affordable. And there's some great breakdowns out there on the web that take into account the cost of the diapers, the cost of utility,

the cost of water and detergent. All those things taken together are still much much more affordable than the cost of disposable diapers over the same period of time. Yeah, and quickly, if you are looking to do cloth diapers, there are all sorts of used clothing stores. Used baby clothing in particular is a way to go, and you can find used diapers there as well. And if they've been bleached and and clean thoroughly, used cloth diapers are

actually not a bad purchase. And so when it comes to car seats, there are some completely safe and affordable car seats out there as low as four bucks right now. I looked today on Amazon uh and up to you can spend a ton of money on like the one

that comes from Italy spent three fifty bucks. There's a huge range of options out there for you, and there's other options to consider to like maybe borrowing our friends if you know that they hadn't been in an accident, they know that they want to hang onto that seat for a while because they're gonna have another kid maybe in a couple of years, Well put that thing to use.

Borrow that from a friend. Yeah. I actually bought a used car seat for our first daughter, and I wrote about it on the internet, and I kind of got some flak for it, but I was totally cool. I bought one in the neighborhood from someone that honestly not even someone I met before that day, but they were in the neighborhood. They were super local, and I talked to them, and so I was comfortable buying that car

seat used. It was most important to me was that that car seat was in date, that they told me that it had not been in an accident, and that it was a well reviewed car seat as opposed to buying the the cheapest one that I could buy online, buying a really well reviewed one that was less expensive because I was able to buy it used. And you mentioned in date, and what you mean by that is that car seats have an expiration date, which is kind of this weird thing that they have. It's not like

it's a perishable food item or a beer. But yeah, the fact is that there's dates on there, and it's law that you can't use a car seat beyond that expiration date. So obviously you want to make sure that you take that into account. And by the way, on the note of baby stuff, there are so many other baby supplies that add to the cost of having a kid when we buy them new and when we buy the fancy stuff. And I think, especially if it's your first kid, it's easy to think that you need to

get all acquire all these new items. But these new baby items like a stroller or a crib, they lose their value super quickly. It's very very similar to buying a new car in how rapidly those items depreciate. And if you had just bought something gently used, you would have enjoyed it just as much. But you would have saved a ton of money in the process. Yeah, it still would have gotten the job done. Yeah. Plus, this is baby stuff, right, It doesn't keep like that fresh

new out of the box smell for very long. Anyway. I'm thinking of cribs too, man. There's an eight hundred dollar crib out there that you can get that's really fancy, really cool looking from West Elm. Or you can buy the affordable crib that does a fantastic job, and you can buy it used. Like we spent forty bucks on a crib for our first daughter and we usually still alive. She made it. Yes, not only did she, but our

two other daughters did as well. We used that crib for three daughters and we haven't talked about it, but I guess we're gonna use that for our fourth baby as well. But there's just huge savings, like you said, Jill, and buying used, all right, Matt. So let's get to the four big categories that are the biggest influences in how much a kid actually cost and then what you

can do to lower the costs in your life. The first one is housing, and that, according to the survey, is of that overall two dollar figure, Juel, And this can kind of maybe be a confusing number because it's not like you're building a house out back where you have to pay a new mortgage on a house that now your baby lives in. You think, oh, we already

have a house. But the way that the report calculated this cost is they they figured out the cost of an additional room on your house, and so certainly they don't take into account things like a kitchen or bathrooms, because you don't need more kitchens when you have a baby, but you might need an additional room. So that's how they figured out what these comparable cost of housing would be.

And a lot of folks feel that need for additional space, But honestly, I think this is overblown, Like this might be true for a lot of people, but it's it's really not the case. Joel. You've got two daughters sharing a room. We've got three girls together in the same room, and that's worked out incredibly well. To think that some families out there are thinking, oh, we've got three kids, we need three additional rooms. I can see how the cost of you know, raising a kid could skyrocket if

you're taking all those additional rooms into account. Matt. I kind of grew up watching a little bit of a little house on the prairie, and they those girls slept on like a lofted hey kind of situation, right, So I think they squeezed a bunch of kids into that tiny house. And when you look at the way that home sizes have grown in the United States over the past forty years, they've grown in quite a big way. And so to think that the current size of homes

is normal and is necessary, it's just crazy talk. It's just it's just not in to any way that you can cut back on your housing costs, any way that you can put more kids sleeping in the same room, in any way that you can delay moving from one house to another in order to accommodate your growing family. That's going to be a big boon to your finances and it's going to really hold back that number, that overall number they're gonna spend on the cost of really

raising a kid. Yeah, with babies and new kids come a lot of stuff, and honestly, I think one of the best ways to combat that is well, first to not have as much stuff, but to organize that stuff. And one of the best ways to stay put and to make the house that you have make do and work is to organize all that stuff. You know, you can spend a few hundred dollars on organization and you might think, wow, that's a lot of money to spend

on shelving and storage solutions. But when you compare that to the amount of money that you could be saving, like maybe even thousands and thousands of dollars because you're able to stay put in the same house and not get a new mortgage because you're forced to buy a larger house, Well, that's gonna be a huge way to save some money. And so food was the next major

line item in the study that we're referencing. So your grocery budget is going to go up when you have a kid, there's no preventing that, right, But the report showed that on average, the percentage of food budgets spent on kids was equal to that of adults. And Matt, we've talked before about how your children actually kind of eat more than your wife, So so that's true. Yeah,

this is totally true for us. So the best way to keep your costs down is to not not feed your kids, but to slim down your overall grocery bill. And we have an episode episode thirty four where we talked about that extensively, And there are a lot of ways in which you can cut your grocery bill, but quickly, just a couple of things. Shop at one of the cheapest possible grocery stores, and that is all the If you have an all D close by, that's gonna be

a great way for you to save money. No matter what. The amount that it costs for me to eat is about the same it costs for my daughters as well. One of the tricks and making that work is to make sure that your kids are eating one to one with you as far as the actual food. What I mean by that is to avoid kid branded food. There's lots of puffs and foods that are geared specifically towards kids, in particular when it comes to snacks, and you're paying

tons of money for puffed air. Basically it's like puffed a with a little bit of flavoring in it. But if you can stay away from those very expensive kid treats and snacks and instead try to get them to eat the real food that you're eating, like the actual vegetables and the actual meats and grains and fruits. That is such an important and key way to keep your

grocery budget and check. And honestly, for us, that's just been a very meaningful way for us to eat together as a family, Like we're all eating the same thing. It's not as if the different kids have their own meals, because it's just what they require, what they demand. Certainly there's a lot of kids that might have special dietary requirements, but beyond that, trying to get your kids eating the

same food that you're eating. Another way to lower the cost of food in your life when you have a kid is to stop eating out, especially after you have kids. The more you eat out, the more it's going to cost you. Grained, Yeah, what a kids eating Typically when you're when you go out to eat, they're eating something out the kids menu. It's a little bit cheaper than the adult entree. But I'll say this, I remember growing up and we we rarely rarely ate out, even fast food.

It just was so much more to stop at need at McDonald's or Burger King or whatever. It was a huge deal to do that. It was a completely huge deal. We just didn't do it because it was so much cheaper to eat at home, and so I think if you weigh the costs of eating out, especially when you have kids, the cost of eating at home just pales in comparison. It's so much cheaper. And so yeah, when

you can cut that out. My wife and I we like to go out for date night together when when it's just the two of us, but we don't go out to eat as a family very often because the cost just adds up so quickly. And the third category when it comes to expenses on children is childcare and education, which takes about six of the total. And you know, this is really hardest when both parents are working and

the kids are young. Dude. In some cities, in particular up in the Northeast, it can cost up to eighteen hundred dollars a month in childcare, which mean, I can't even fathom. That's just such an unbelievable large amount of money. And so some ways that you can try to reduce that is when it comes to your childcare, like ask for sibling discounts. A lot of times with daycares, that's something that they offer, but they don't post it anywhere and you don't get that discount unless you ask my

buddy Alex to just how that happen. He really asked because he had another kid going into that same daycare and off the second kid, but he wouldn't have known if he didn't ask. Dude, that's a huge discount. It's a huge discount of gas. But then look to family as well, like our friends or grandparents, you know, relatives. You know, what better way than to have actual family, like actual blood take care of your kids for you,

and also consider a nanny. Shore that's a really affordable, smart way to approach childcare with neighbors, with folks that live close by to you, in particularly because you can just take your kids over to their house and drop them off when the nanny shows up over there, or vice versa. When it comes to K through twelfth grade schooling, different families place different priorities on kind of how they

want their kids to be educated. And private school though, is going to be obviously the most expensive choice, and this kind can become a contentious topic. So I don't I don't want to hang out on your schooling choice for long, but just know that, yeah, choosing a private school is definitely the most expensive option, and maybe homeschooling is a better option. But then, Matt, it kind of gets into the factor of can a family afford to have one of the parents stay at home and make

that a reality, So let's kind of get into that too. Yeah, Joe, that's a huge consideration, right, Like you might think that you can't quit, or like that you can't go part time because your family need dr income, and certainly this might be true, but make sure that you are factoring in taxes that's being taken out of your page check.

Make sure that you're taking into account childcare costs. If there's ways that you can save your family money by not working, make sure that you're taking that into account as well. I know for a lot of folks it might be extremely important to be able to work outside of the home. I know folks who the money that they're earning from their job was only pretty much breaking

even with their childcare costs. But for them to have some of that part time work, to be able to get out of the house and to be a part of a bigger organization and something that they really believed in, was really important to them. So I don't want to discount that at all. I know there are a lot of folks who that's a tough decision. Then they've made

the best choice for them and their family. But what I'm saying is, just make sure you're taking everything into account when you're weighing the pros and cons of your work and childcare. Yeah, and if one of the partners does decide to stay at home, your income is of course going to go down, But there are also ways that a stay at home partner can save your family money in a way that to working parents find it

really difficult to do. So. Looking after that food budget becomes a whole lot easier if one spouse stays at home. And also that spouse can use their skills and their work experience to maybe earn some money on the side while working at home, and it could even lead to a side hustle that ends up paying off big time in the long run. And the next big category that we want to cover is transportation, which can take of

the total expenses. And the reason for this, honestly is a lot of times folks are buying a new vehicle because they want to make sure they have that safe car. The fact is you can still find very safe and very affordable cars that will fit your needs that are at least five years old, meaning that you get a huge break on the cost because you haven't taken that

hit in depreciation. I think, especially for new parents when it comes to making purchases of a stroller or a car seat, or or even something as expensive as a car, the sort of safety billing becomes super important and almost

oftentimes too important. Can can I say that? Like where where they value the safety rating of something and they're willing to pay crazy amounts of money hand over fist for for something that gets the highest safety rating, and they feel like they need the newest, most up to speed safety technology and so like, especially when you're talking about a car, you are going to pay so much more to have the latest, newest car that has the most up to date safety features installed on it versus,

like you said, buying a car that is five, six, seven years old, maybe even that is still well reviewed when it comes to safety. We're not talking about buying like some hootie. Yeah exactly, Yeah, yeah, You're not talking about buying something that is a complete piece of junk. In order to save as much money as humanly possible, it's just important to note that when it comes to buying things because of their safety writing, it's a losing battle because who can afford to continually buy the most

up to date safety stuff. I mean, it's just it's just not possible to stay completely up to speed on that. And there are perfectly fine, perfectly safe car seats and cars that are much more reasonably priced than the latest and greatest. Yeah, Ji, so much of what I what I'm sensing that you're talking about here is marketing that is sort of praying on fear. You hear that, especially in so much of advertising on radio and TV, and it's like, keep your family safe, and you can only

do that by buying this product. And I just think that's a false economy. Yeah, you gotta be wary anytime you hear that, right, But at the same time, I totally relate and I totally understand. I remember, as a new parent with my very first baby, driving home from the hospital on the Connector in downtown Atlanta. By the way, the Connector, if you've never driven on it, I think it's like fourteen lanes wide and ours or zipping by.

I've never driven so carefully in my life in the far right lane just minding my own business and trying to tell everyone like I was this close to put my hazard lights on, you know, like I get that in particular when you're a new parent. But one week later, I'm just driving like I'm really driving, just like passing people. Well, now we know how you normally drive. That's the truth. But don't let that fear, especially early on, cause you

to make unwise purchases. And so that's the cost of a specific vehicle, but there's just other expenses that this report takes into account, just to wear and tear on a vehicle, the cost of fuel and insurance, and so consider other ways that you can keep your transportation costs down. If you have children, try car pulling with the neighbor,

if you're going to the same daycare or Joel. In our case, you and I we do a lot of bike pulling, and I think that's a totally valid option is to consider a cargo bike, which is going to be much more affordable than any car out there. Cargo bikes aren't for everyone, but come on, you gotta you gotta give it a shot. Yeah, Matt, I feel like we mentioned cargo bikes a fair amount on the show. Every other episode, So let's keep this one short. Probably yeah,

but they're the best, all right. So we just tackled the big four spending categories when it comes to how much kids actually cost. Right out for the break, Let's get to some additional questions you have to ask yourself about your strategy when it comes to how you spend

money as a parent. Okay, we just talked about some ways that you can say when it comes to the big categories and expenses related to your kids, and so right now, I want us to sort of ask ourselves some bigger questions, right and so one, ask yourself, what is it that you value The expenses associated with kids? You know, more or less will reflect the kind of expenses and spending that you have for yourself as an adult.

As a grown up, it's natural that the things that we value for ourselves that we would value those things for our kids as well. So sort of, like we mentioned at the beginning of the episode, there are very few expenses that just kind of pop out of nowhere when we start adding kids to the equation. Most of the time they are expenses that you already have in your life, but you just see those expenses inflate once

you start adding kids. Yeah, I think when you reflect on your your values when you have a family, Knowing your values, knowing your priorities can help direct not only how you spend your time with your family, but also

how you spend your money. And oftentimes, if we don't have those things kind of called out, if we haven't written them down, if we haven't made our priorities known, if we haven't had that discussion with our significant other, then it's so much easier for us to justify spending in the short term, especially when it's spending for your kid, right, So, yeah, I think it's an important exercise to kind of think through what your values are and aligning you're spending with

those values. Matt, We've talked about that a lot, but it's especially true when you have a kid. It's so much easier to make those spur of the moment decisions to spend money on them. It feels more sacrificial, less self serving, but ultimately in the end, it's still not good for your for your finances. And so yeah, doing the do your due diligence ahead of time and thinking through and and asking yourself that question is really important.

Jel and I can totally relate with that as well. Right, who doesn't want their kids to have the very best or to have opportunities that they didn't have as a kid. However, I think some questions to ask ourselves are like one, are you doing this for your kids or are you actually doing this for yourself? So are you actually looking at the needs of your kids or are you thinking about things from the standpoint of how it makes you

feel as a parent. For instance, I think of secondhand clothes, right, they work perfectly fine, but maybe as a parent you want your kids to have a new hip clothes. Keep that in mind. Are you doing it because there is an actual need or because it's how you want to be viewed, maybe how you want to be perceived by others that you know, Yeah, Matt, we want to be generous parents. We want our kids to feel loved and cared for and that they're are part of a family

unit that cares for each other. Well, at least from where I'm sitting though, the place I want to be most generous with my kids is my time. And if I'm spending my money on more articles of clothing, it means I have less time because I have to spend more that time making money, and if I can trade off a little bit of that time that I would spend working for dollars, then I can take that time

and invest it in my kids. And I think they are so much better served by some extra time with her dad than they are by having more clothes in the closet. And based on personal experience, there are lots of perfectly fine pieces of clothing that our girls get and whether they're new or used, they don't really care.

They don't want to wear half of them anyway, and so that just becomes an issue when you're a parent and you're like, man, I just spent like fifteen dollars on this shirt or jacket or whatever it is, and your kid doesn't want to wear it. That's a pain because you feel like you just did something nice for them and they're not appreciating it. And so the best generosity I think that you can give towards your kid is a generosity of yourself, really, your your attention in

your time chedual. And what I love about that is that you're questioning what it is that you're teaching your kids through that consumption and through that spending. When we overspend on our kids, consider what messages that we're communicating to them through that. If you give into every whim or every design that they have, you're teaching them that their happiness is paramount. That's all that matters, right, or at the very least, you're not teaching them the value

of money. And so as you're spending money on your kids, it's worth keeping in mind the messages that you're sending to them regarding money. And one more question for us to ask ourselves as parents is why don't our values match up? If you, as a parent, are spending more on your children than you are yourself, it's worth asking why are you spending a disproportionate amount on your kids for them to be happy and have the best When you're happy and content with much less, Hopefully you're spending

is value driven. And so that's a lesson that is worth sharing with your kids. I think it can get

tougher to Matt as kids grow up. I just remember myself looking back at middle school and how I wanted the name brands and I think I mentioned in a previous episode about wanting the Scottie Pippen shoes and and there are certainly, uh, there are a lot of polls on kids to want the latest and the greatest, and parents, you know what, they want their kids to be happy, and they want their kids to be liked at school and to to not get made fun of for the

crappy shoes they're wearing or whatever it is. But as a parent, that kind of guiding light of your values and matching your values to how you spend money on

your kids. And you don't always want to say no to your kids even when they want something, but reiterating your family's values continually as your kids grow up, that's gonna be helpful in reminding them that when they do ask for something that obviously you're not going to buy them, that it's not because you don't love them or that you don't want them to be happy, but that you have a greater sense of purpose as a family together.

And so that just takes increased level of communication about the things that matter and know in that process that you're helping teach your child principles that are gonna last a lifetime. That pair of shoes or that cool shirt or jacket or whatever it may be is a quick fix, and there's gonna be the next cool thing that they need. And there's never going to be any level of ultimate

satisfaction there for your child. But the way that they are met in that by you as a parent, in a thoughtful response, showing them the values that you hold together as a family. It might not be super satisfactory in the moment it, but it brings ultimate satisfaction to a kid who really wants to believe that their family

has a greater ideal and purpose. Yeah, Joel, And hopefully those values as well translate to savings when it comes to spending, right, And this also applies to entertainment as well. I know for us, like my family, okay, and now, we love to go hiking. We love to spend time outside and that's something that we're trying to instill in our in our girls that we love spending time outside

in nature. And guess what, it turns out that hiking is free, and so that's a way that we're able to directly reduce the cost that we spend on entertainment while at the same time getting exercise and fresh air and stepping away from technology Like these are all things that we value as a family, and it just happens that is free. All right. Let's also tackle quickly, Matt, the subject of having more kids. So does each additional kid that you have double the amount that you spend

on the cost of raising children? What do you think? No, man, you know the answer is no. And so why is that something? I don't know what you wanna call? It? Seemed called like the diminishing expenses of having additional children. And that's because each additional child that you have after having that first, they cost less. It's not that your total costs actually goes down, but the percentage of money that goes towards each additional child is going to be

less than that first one. Obviously you're gonna pay more money overall by having more kids exactly. Yeah, there's another mouth to feed, for sure. But you've kind of gotten like that kids startup fee out of the way, right, Like you said, yeah, reusing your crib or putting more kids in one room. It's like, the costs do not have to grow exponentially, And in fact, the more kids you have, the second, third, and for you fourth kid are going to become vastly cheaper. Right, that's right, man.

According to that report that we've been referencing when you have one kid, they've calculated that of your expenses go towards that one kid, but with that second child, it doesn't double to from fifty two, it only goes to thirty nine when you have that second child, and when you have that third child, it only goes up to forty percent. So again we're not saying that there's a savings when it comes to having additional children. It's again it's going to cost more money, but each additional child

will cost less than the one before it. Matt, I think overall, taking just kind of a more minimalistic approach to parenting is a good way to go, like finding those free activities like you mentioned hiking right, And we went to a recent birthday party of a friend and their twins returning three, and I love what they did. They asked people to bring used gifts from their house as opposed to buying new gifts for their kids, and I thought that was just a great way to do

it. It It helped our girls actually find ways to give away the stuff that they kind of already had that they don't play with as much that they thought these girls would like. And at the same time, you know, we weren't having to go out there and buying new stuff. And so I think there are lots of ways for parents of kids to save money. There are just lots of untapped ways that we forget, that we don't take

advantage of, that we don't even try. And so much of it is because of that kind of keeping up with the Jones mentality and trying to make sure that our kids have like all the things that they not only need, but that they want, and that that ultimately is kind of an impossible task. All right, maw Let's get to our final thoughts on the question of how

much do kids really cost? And we mentioned the federal study that shows that the average cost of raising a child is two hundred and thirty three thousand dollars, And that's a big sticker shock, and there are a lot of people that will spend that much or or even more raising each child. But when you take a look at the bigger picture of housing, food, childcare, and transportation, there are many ways that you can save and do things just a little bit differently and drastically reduce the

cost of raising a kid. Cheduel. That's the thing, right, It doesn't have to cost a quarter of a million dollars to raise your kid from zero to eighteen, but it might It all comes down to you and you're spending. And really, one of the worst sort of things that I think could happen from this is a couple who happens to be more frugal. They see this number and they say, wow, it actually costs a quarter of a million to to raise a kid. I don't know if

we can handle that. And what they've done, though, is they've taken the average American what they spend on their kid and they've extrapolated that to their own situation, when in reality, it's going to cost them much much us to raise a child, and they would have potentially lost out on the joys of being a parent. Yeah, and having kids obviously isn't for everyone, but if you're this deep into the episode, you're probably at least mildly interested in it and you want to know how much it's

gonna cost you. And so just remember what you spend is a reflection of your values, and there are ways that you can help your kids see what your family values throughout their childhood so that when you are able to have those discussions with them about what your family prioritizes in regards to spending. It's a life giving conversation as opposed to one that makes them feel bad for asking. All right, Matt, let's go back to the beer real quick.

We enjoyed a beer called Heavy Hands from Spindele Tap Brewery today on the show. What was your take on this one? Oh? It was so good. This is another delicious beer from Spinell Tap. Joel. To me, this beer tasted fresh and alive, you know, well like we've had some fresh hot beers before, and where it tastes like

it's been canned like the day before. And in this case, it almost has like that tingly sort of feeling as you're drinking it to where the best way, Yeah, the best way I can describe it is that it tastes live like it it sparks joy in my mouth. Uh. And it's a fantastic beer, That's what I'm saying. Marie Condo would definitely approve of this beer, I think. Yeah, to me, this is like a hoppy juice bomb with with some nice kind of like pineapple notes. I really

enjoyed it. I think this was actually maybe even a touch better than the beer that we had a Monday's episode from Spindle Tap. But men, they are just from those two beers alone, they're putting out just some crushingly good I p a s. That's what they specialize in, and I kind of love that that's what they stick to and they just do a really good job making I p a s. Yeah, so huge things to the Leo and all of our friends out at spindle Tap for donating some beers to the show. Yeah, thanks so

much everybody for listening to today's episode. We'll have show notes up on our website How's the Money dot com and reviews. We always love a positive review, so head over to Apple Podcasts if you found this episode helpful, and while you're there, be sure to subscribe. All right, buddy, Until next time, Best Friends Out, Best Friends Out.