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Mind Your Business

Mind Your Business Week of July 9, 2014

Cost of raising a child

“Hot fun in the summer time” is one of my favorite songs for this type of great weather we are having in Ohio, after that long spell of cold weather. This time of year you, see more concerts and festivals because of the great weather and fun things to do. Growing up, things I used to think were expensive are hitting the roof right now. I was watching television and they were showing a couple of movie theaters being remodeled with nice cushion seats and said the tickets will cost a dollar or two extra. Movie tickets are already $9 to $10, not including the price of a 3D movie that adds a few dollars more to the price. When you think about it is it cheaper to have a date night at home with your own food and movie from another source? Let’s add up a movie night: $20 for the tickets, $20 for popcorn and drinks, plus the concern of having people taking or lighting up the movie with their cell phones and the beep from a text coming in. Laughing about my era… remember the Miles Drive-in? We all snuck in under blankets, in the trunk, to pay for less heads but enjoy the outdoor movie. I could not wait for Easter every year to go downtown and eat at the Forum and go see a movie at the Hippodrome or the Embassy Movie Theaters that sat right across the street from each other on Euclid Ave. Household spending adds up when you think about games like Wii and Playstation systems costing $200 dollars plus not including the games prices. We played Hide n Seek and Tag for free. The girls played jacks and other games and never cost our parents a dime. Last year, the U.S. Department of Agriculture (USDA) released its annual report, Expenditures on Children by Families, also known as the Cost of Raising a Child. The report shows that a middle-income family with a child born in 2012 can expect to spend about $241,080 ($301,970 adjusted for projected inflation*) for food, shelter, and other necessities associated with child-rearing expenses over the next 17 years. That’s a lot of money. Now, when I was coming up, I don’t think my parents were nowhere close to spending that on me. I can hear my mother’s lecture now. “I am going in this store to get a few items. I am not buying you anything, so don’t ask for anything. If you show out on me in this store, I will beat your butt in this store.” For middle-income families, housing costs are the single largest expenditure on a child, averaging $71,820 or 30 percent of the total cost over 17 years. Child care and education (for those incurring these expenses) as well as food were the next two largest expenses, accounting for 18 and 16 percent of the total cost over 17 years. These estimates do not include costs associated with pregnancy or education beyond high school. Another cost associated to communities not being close knit is the lack of neighbors who watch each others children. Our parents did not send us to day care, spending $150 dollars a week. Mrs. Smith and Ms. Williams would watch me when I came home from school and even fed me because that’s what people did back then. In further research, I found out that in 1960, the first year the report was issued, a middle-income family could have expected to spend $25,230 to raise a child through age 17. Housing was the largest expense on a child both then and now. Those were my years coming up and to my mother I am sure $25,000 was a lot of money. So knowing the cost of raising a child in 2014, you must ask yourself, “Am I financially prepared to handle doing that?” Not only has the cost to raise them changed so has the rules. They now have laws on the books that my mother would have been guilty for, but I would not have NEVER called and reported her. The costs for children in a household depend on many factors like the number of children in the family. Some things can be shared, such as housing and transportation. I remember a family in my neighborhood that had so many sisters they all was clean because they shared each other clothes, a nice savings. So now, when having a child, remember clothing costs include children’s apparel such as diapers, shirts, pants, dresses, suits, footwear and clothing services such as dry cleaning, alterations, repair and storage. Higher-income families spend more money on their children than do lower-income families. Families in urban areas spend about the same amount on their children as do families in rural areas. Some parents with children under the age of one have been hit by changes to the child benefit rules introduced in January 2013, which mean that households where a parent earns more than 50,000 must repay a proportion of the benefit through a tax charge. Motivation is the key to any success, what motivates you? My mother use to always say you live by the sword you shall die by the sword. When you do wrong to others, it comes back and bite you through your daily coming and goings or even your family.

Enjoy your summer and remember to mind your business.

Follow me on twitter at @jimmywadeiii

Write Wade at the Call & Post, 11800 Shaker Blvd., Cleveland, OH 44120, or e-mail him at jwade@call-post.com. Comments and questions are welcome but, because of the volume of mail, personal responses are not always possible. Please note that comments or questions may be used in a future column.