Do the Math: 4 Ways Child No. 2 Costs More Than No. 1

Photo (cc) by Emery Co Photo

Many people, including the government, believe raising a second child is cheaper than the first. But that’s often far from the reality of having a second kid.

In its Expenditures on Children report, the Department of Agriculture asserts that the cost per child goes down as families add kids.

“The children can share a bedroom, clothing and toys can be handed down to younger children, food can be purchased in larger and more economical packages, and private schools or child care centers may offer sibling discounts,” the report said.

I disagree, and it appears I’m in good company. As Charles Passy recently wrote for MarketWatch:

… as the father of two children myself — a son just out of graduate school, a daughter in high school — I’ve done the math and can say without hesitation that one plus one doesn’t equal 2 (or less). If anything, it’s more like one plus one equals 3.

Passy writes that there are a number of extra costs associated with a second — or third — child, including these four:

  • Room to grow: Sometimes it’s not feasible to have two children share a room, especially if the room isn’t much bigger than a closet, or there’s a large age gap between the children. If you need to move to a bigger home to accommodate a second child, the costs can be significant. Real-estate brokerage Redfin said each additional bedroom can add $86,000 to the price of a home, or $7,600 more a year in mortgage payments (based on a 30-year loan).
  • Compact car vs. minivan: While a compact car works well for one child, you may outgrow the vehicle when you add a second child, especially if you have two car seats, or you want to travel with the entire family. Massey said he upgraded from a Ford Escort, which he purchased for $12,000, to a $27,000 Honda Odyssey.
  • College: It’s expensive to send your children to college. It’s even more expensive to send a second child to college. College costs are going nowhere but up, so your second child will likely need a bigger college savings plan than your first.
  • Miscellaneous extras. These costs include car seats, sports leagues and summer camps, among others. Passy writes: “For starters, the whole hand-me-down thing doesn’t play out as well as many parents anticipate. Some of it may be because the children are of opposite sex. … Some of it may also be because the products you’re hoping to pass down are simply out-of-date — or even worse, have been subject to safety recalls.” Sometimes in an effort to not play favorites, parents — myself included — make similar purchases for their second child that they did for their first. Passy writes that because parents want what’s best for their kids, “the things we buy for that first child (even if the purchase was a “treat”) become a built-in commitment for the second (even if financial circumstances have changed).”

I have a 5-year-old girl and a 2-year-old boy. We bought all of our nursery items and bigger baby items like the high chair, car seat and stroller in gender neutral colors, so both children have used them. But so far, that’s where the savings have ended.

In your experience, do you think raising a second child is more or less expensive than raising a first child? Share your comments below.

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