The cost of raising children in Australia

Having children is a life-changing and joyous experience for most parents, but it also comes with added expenses that can push the budgets of even the savviest savers.

According to a 2018 government study, parents at a bare minimum can still expect to spend around $140-$170 a week to raise a child. It's not unusual for this figure to be far higher for most parents and guardians, however.

What is the cost of raising a child in Australia?

There are a few different answers to that. We looked at a couple of studies and found the estimates ranged from $159,120 up to $548,500 over 18 years.

According to 2018 research by the Australian Institute of Family Studies, it costs low-paid families $340 a week to raise two children, a 6-year-old girl and a 10-year-old boy, which is roughly $170 per child. That's $8,840 every year or $159,120 for 18 years, per child.

For unemployed families, the cost of raising two children of the same ages was $280 a week or roughly $140 per child. That's $7,280 every year or $131,040 for 18 years. Again, per child.

However, a 2013 report by the University of Canberra came up with completely different figures.

The earlier study created profiles for three different families: lower income, middle income and higher income. It found that the cost of raising two children would likely range from $474,000 to $1,097,000 over the course of their childhood.

For one child, that's an estimate of $13,166 to $30,472 every year or $237,000 to $548,500 over 18 years.

What are the biggest costs when raising a child?

In 2016, the government created a guideline budget for low-paid families. Its aim is to give parents an idea of how much different items are expected to cost each week, at a minimum.

* We rounded the figures to the nearest dollar.

Why is it important to know the cost of raising a child?

If you understand the cost of raising a child, you can make important decisions in advance. You can start saving, create a support network, develop a budget and find affordable housing.

Anne Hollands is the director of the Australian Institute of Family Studies. She said the cost of raising a child has long been of interest to potential parents.

Understanding the potential cost of having kids can also allow you to put an appropriate financial safety net in place. For example, life insurance or income protection insurance, which guarantee a wage if you become too sick or injured to work.

How can insurance help with the cost of raising kids?

Insurance can give your family an important safety net in case anything goes wrong. If you die or become too sick to work, life insurance and income protection mean the difference between falling behind on the mortgage or having enough money to pay for the best healthcare. Here's a summary of how they can help:

• Life insurance pays a lump sum if you're diagnosed with a terminal illness or you die. The money can be used for whatever your loved ones like, whether that's paying off the mortgage, covering school fees or just keeping on top of everyday expenses.

• Income protection insurance replaces up to 75% of your regular wage if you ever become too sick or injured to work. Again, you can use it for whatever you like but it means you can focus on getting better, rather than worrying about paying the bills.

Compare life insurance and income protection quotes

We've put together a list of all the life insurance and income protection providers available on Finder. Click through for a personalised life or income protection quote. Not sure which one you need? Our life insurance vs income protection page can help.

• Life Insurance
• Income Protection

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Name	Product	Maximum cover	Maximum Entry Age	Fully Underwritten?	Terminal Illness Benefit	Optional Extras
NobleOak Life Insurance Finder Award		$15,000,000	69		$3,000,000	TPD cover, Trauma cover	Get your one month free when you buy NobleOak Life Insurance policy. Offer ends 31 December 2021. T&C's apply.	Get Quote View details	Compare	loading Fetching your data...
Real Family Life Cover		$1,000,000	64		$1,000,000	TPD cover, Trauma cover	Get a refund of 10% of the premiums you've paid (in the first 12 months) with The Real Reward™ .	Get Quote View details	Compare	loading Fetching your data...
Medibank Life Insurance		$2,500,000	70		$2,500,000	TPD cover, Trauma cover	Medibank health members save 10% on premiums every year. T&Cs apply.	Get Quote View details	Compare	loading Fetching your data...
Zurich Ezicover Life Insurance		$1,500,000	69		$1,500,000	No optional	Get your first month free and a 10% discount by taking out a second life insurance policy (discount applies to the second policy). Customers who suffer a serious side effect from an approved COVID vaccination may be eligible for a $50,000 one-off payment. T&C’s apply.	Get Quote View details	Compare	loading Fetching your data...
ahm Life Insurance		$1,500,000	65		$1,500,000	TPD cover, Trauma cover	ahm Health members can save 10% off premiums.	Get Quote View details	Compare	loading Fetching your data...
RAC Life Insurance (Only available in Western Australia)		$25,000,000	69		$25,000,000	TPD cover, Trauma cover	When you purchase RAC Life Insurance, WA residents receive complimentary RAC membership which includes access to discounts on fuel, savings on shopping, entertainment and more. T&Cs at rac.com.au.	Get Quote View details	Compare	loading Fetching your data...

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Name	Product	Maximum Monthly Benefit	Maximum % of Income Covered	Maximum Benefit Period	Waiting Period Options
AAMI Income Protection		$10,000	75%	Up to 5 years	14, 28, 60 or 90 days	If you’re an existing AAMI customer, you can save 5% on income protection. New customers can get one month free by paying annually.	Get quote View details	Compare	loading Fetching your data...
Suncorp Income Protection		$10,000	75%	Up to 5 years	14, 28, 60 or 90 days	Sign up and become a member of Suncorp Benefits. Access savings of up to 15% from major retailers. Existing members can get a 5% discount off their policy.	Get quote View details	Compare	loading Fetching your data...
Insuranceline Income Protection		$10,000	75%	Up to 5 years	14, 28, 60 or 90 days	Get a $100 bonus gift after 2 months. Plus, and get 12 months cover for the price of 11 if you pay annually. T&Cs apply.	Get quote View details	Compare	loading Fetching your data...
NobleOak Disability Income Insurance Finder Award		First 24 months: $30,000. Thereafter: $25,250	70% for the first 24 months, 60% thereafter	Up to Age 65	30 or 90 days	With NobleOak, you can lock in a policy with a benefit period covering you up to the age of 65. Cover limits may go as high as $30,000.	Get quote View details	Compare	loading Fetching your data...

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How much does childcare cost?

According to Care for Kids, the average cost of childcare in Australia is $113 a day, before subsidies. That's easily going to be the most expensive outgoing for lots of parents.

However, the price can vary significantly depending on where you are. In Sydney city centre, the average daily price jumped to $167 while Melbourne was $157 and Brisbane was $137. The costs in Perth are $147 and $113 in Adelaide.

Head further out and childcare becomes less expensive. New South Wales' Blacktown reported an average daily price of $98 while Victoria's Dandenong was $106 and Queensland's Ipswich was $100.

To put the cost of childcare into perspective, an average-earning Australian couple with two young children is likely to spend around 17% of their income on full-time childcare costs, according to the OECD.

Thankfully, government benefits are available. Check the Australian Government's Family Assistance Guide to see which ones apply to you.

*Figures taken on 24 March 2021 from Care For Kids child care costs calculator.

How much does education cost?

According to the Australian Scholarships Group (ASG), parents can expect to spend an average of $68,613 to send a child born in 2017 to a metropolitan state school.

Of course, that price balloons if they decide to send their child to a private school. In that case, they can expect to spend a whopping $487,093 on their child's education.

*Source: The Australian Scholarships Group (ASG). The government prices are not representative of ACT, as there are no fees for state preschools in the region. Preschool figures are based on 15 hours per week.

The cost of raising a child can be more complicated

It's very easy to spend more than the government's estimated figure on raising your child. Especially if you don't fall into the unemployed or low-paid category.

In 2019, women's media platform Mamamia asked 11 families to analyse their weekly spending per child. The figures ranged from a frugal $152 all the way to an eye-watering $863.

You've also got to take into account the economic impact of taking time off work – either for parental leave, to raise your children for a few years, or even just turning down overtime hours.

A 2014 report by the Australian Human Rights Commission found that 49% of the mothers and 27% of the fathers reported experiencing discrimination in the workplace during pregnancy, parental leave or on return to work.

The same report found that 18% of mothers felt they were either dismissed, made redundant or moved elsewhere due to their pregnancy, parental leave or family responsibilities, or breastfeeding requirements.

Non-monetary costs of having a child

Of course, money isn't the only thing you'll have to part with if you decide to have children. Social engagements, spare time and even career ambitions can all be impacted.

Finder surveyed over 2,000 parents in 2018 and 90% admitted they had to make big sacrifices when they welcomed their first-born.

The vast majority of Aussies (28%) said leaving the workforce, or having their partner leave the workforce, was the biggest sacrifice they had to make.

We also spoke with three mums who shared their personal sacrifices as they became parents.