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Does it Take a Million Dollars to Raise a Kid?

By JLP | March 3, 2007

Does it really take $1,000,000 to raise a kid (through age 17)? The government’s estimate is $279,450, but according to this story in this weekend’s Wall Street Journal, many people will spend much more than that on their kids. One woman even spent $1,000 on her five-year old’s birthday party:

In San Diego, Jacqueline Jones recently rang in her fifth year with a $1,000 mermaid-theme party. The fête, held at a community pool, included a piñata, pizza, cake, juice boxes, customized goodie bags for 20 and a former beauty queen who arrived dressed head to toe as Ariel, the Disney princess. Jacqueline’s mom, Laura, says it’s worth it. “A lot of my friends said I’m crazy, but I mean, it’s for a memory she’ll have forever.”

LOL! It’s more a like a memory she’ll have for two days! Trust me on this one. We spend about $150 and that INCLUDES the birthday gift! I’m not saying our way is better, but I can guarantee you that we aren’t putting our kids birthday’s on credit card.

I think the most extravagant we have been with our kids was the time we spent $300 buying each of our boys a Nintendo DS! We were in Toys R Us one day and we were back in the electronics area and started looking at the new Nintendo DS, which had just come out. Anyway, on the spur of the moment I decided (after checking with Mrs. JLP first) that we should buy each of our boys one. Afterward I felt guilty because I feared that we were spoiling them.

Anyway, I try not to judge what other parents do, but some things are just crazy. I think what people spend on their children should be based on their budgets, and that they shouldn’t go into debt just to give little Johnny the best that life has to offer.

Oh, and be sure to scroll all the way down to the chart in the article.

Topics: Kids and Money | 12 Comments »


12 Responses to “Does it Take a Million Dollars to Raise a Kid?”

  1. db Says:
    March 3rd, 2007 at 10:43 am

    OK,I have a few vague recollections from when I was 5 years old or younger — mostly because they were seriously traumatic. Like I remember spotty parts of a transatlantic flight I took, most especially throwing up all over the stranger sitting next to me.

    I do not remember any birthday parties or Christmas days from that time. My primary memories up to about the age of 6 or 7 are really mostly intangible things like remembering smells or tastes or momentary visuals of people, feeling loved, feeling secure, feeling lonely, etc. My only connection to specific events are the pictures.

    What a shame to blow $1000 so their kid can have a nice photo op.

  2. Wanda Says:
    March 3rd, 2007 at 12:33 pm

    The party does seem a little extravagant, but maybe for Jacqueline it’s like spending $100 on a party (if she is wealthy enough). If I was a kid, I’d love a Belle-themed party. (Dancing plates! heehee).

    Most of the parents I read about spend the big bucks on travel experiences, private schools, and academic tutoring – those are worthwhile things to me. One mom spend $16,000 a year sending her daughter to a school that teaches spanish. Another mom is giving her her daily triple lattes to save for a family trip to Latin America or somewhere (that’s something we pfbloggers can get behind, right? :) )

  3. db Says:
    March 3rd, 2007 at 1:18 pm

    I guess I’m coming from the assumption that the mom is a spender, not a saver.

  4. db Says:
    March 3rd, 2007 at 1:27 pm

    I have one other reflection on this. You hear so many people talk about how expensive it is to raise a child. Looking at this article, it’s easy to see why. While a lot of the examples would certainly be enriching, they also aren’t necessary to raise a well-rounded child. (To take this argument to the less-enriching extreme, consider the chart’s example that a teen girl would consume $4,000 in designer handbags during high school. Oh really?)

    It all ties back into the consumerist-driven societal pressure to spend with abandon. I am not saying a parent should never buy something extravagent for their child! (hint: JLP’s Nintendo purchase isn’t my beef.) However I think we would have a healthier society and healthier children if we doled out fewer extravagances overall. (Really, a teen girl has no need whatsoever for designer handbags.)

    And in the long run maybe we’d have a better perspective about what it costs to raise a child.

  5. fin_indie Says:
    March 3rd, 2007 at 6:17 pm

    Not exactly the best example to set for the kid, either.

  6. Keith Cash Says:
    March 3rd, 2007 at 10:39 pm

    Might could see 200-350 for a party and gifts, not much more.

    Cheers

  7. baker Says:
    March 4th, 2007 at 3:22 am

    The problem with the chart, is it is derived from the top-third income (read the article!). That stuff seems excessive, because to the lower 2/3s, it *is* too much.

  8. » Weekend Reading on Blueprint for Financial Prosperity Says:
    March 4th, 2007 at 11:35 am

    [...] Have kids? Hate taxes? Raising4Boys has a little Q&A about the 2006 Child Tax Credit that may be of interest. JLP writes about how it might take a million dollars to raise a kid? [...]

  9. Paul Says:
    March 5th, 2007 at 5:56 am

    When my oldest was about five years old, my family took a vacation to San Diego. We went to Mission beach, the zoo, the Navy base etc. When we came home, I asked my five-year old daughter what was her favorite part of the vacation. She like the playground behind the hotel where we stayed.

  10. Miguel Says:
    March 5th, 2007 at 9:22 am

    I am firmly of the mind that most of this extravagance is purely for the egos of the parents.

    Was recently visiting some relatives who gave an elaborate b-day party for their 4-year old. We’re the god-parents and for the past two years, I’ve been trying to get them to draw up wills (they have none) and boost their life insurance policies. They claim to not have the time or money to deal with such matters as wills (so their child’s future isn’t left up to a judge) and life-insurance (so their child would have funds for college, etc. in the event they were orphaned). They plan to get around to it someday. But the b-day party is another matter – not much time or expense spared on that.

    Arrhhh… I just don’t get it sometimes.

  11. eR0CK Says:
    March 5th, 2007 at 10:33 am

    It’s $1,000 today on a 5 year olds birthday and by the time the same child is ready to drive, what pray tell do you think they’ll be expecting?

    I can assure you it’s not going to be a used Chevy!

  12. Mighty Bargain Hunter » Roundup for week of 25 February 2007 Says:
    March 7th, 2007 at 10:27 pm

    [...] All Financial Matters questions whether it really takes a million bucks to raise a kid. [...]

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