The Tooth Fairy’s budget is way up.
Where are we going? To the cost of raising a child.
The Cost of Raising a Child
If the Tooth Fairy visited your house during 2022, she probably left close to $5.36. Up by 66 cents more than during 2021, $5.36 was an all time high.
Also though, it depended on where you live. While the tooth fairy asked for $1.46 less in the West (why???), every other region’s average price increased. In my home state, NJ, she left close to $7.00!
- The Northeast: $7.36
- The South: $5.77
- The Midwest: $4.27
- The West: $4.08
Somewhat comparably, babysitters have discovered they can ask for more. According to one childcare marketplace, the typical babysitter that charged an average of $14.72 an hour in 2020, now asks for a whopping $18.05. So yes, the tight labor market is teaching teens a lot about demand and supply. They realize that a shortage of babysitters means $30 an hour is even a possibility.
Leaping from the tooth fairy and baby sitters to the entire cost of raising a child, we can use the latest figures from the USDA. From 2015, still they give us an idea of the dollars. Then, the total cost of raising a child born in that year was $233,610–the same as $288,989 now.
For a child that would be seven this year, this USDA graph gives you an idea of the spending:
Our Bottom Line: Economies of Scale
We can conclude by saying that sometimes more is less. Or, as economists, we could say that we achieve economies of scale when our kids share a bedroom, pass down clothing and consume cases from Costco.
A married-couple spends close to 27% more on a single child than a family with two children. Meanwhile, compared to that family with two children, having three or more lets you save as much as 24% on each child.
I guess if you spend $30 on a babysitter, it’s better having more kids.
My sources and more: While my tooth fairy totals from Delta Dental were up-to-date, I suggest looking at the USDA child cost materials even though they are not. Then, for what really says the cost of a child, do look here at the stress kids create. Please note also that our featured image is from the WSJ babysitting article.and parts of “Our Bottom Line” were in a previous econlife post.