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Rural America Least Costly Region To Raise A Child, USDA Says

Rural America Least Costly Region To Raise A Child, USDA Says

Report finds rural Americans spend less to raise a child; food costs remain mid-range item on list of costliest expenses for all geographies

Rural Americans may be paying less to raise their children, a new report from the USDA finds, pointing to lower housing and child care expenses when compared to other regions of the U.S.

While Americans living in rural areas – defined as places of fewer than 2,500 people outside a metropolitan statistical area – may expect to pay less overall, among all geographies the USDA expects a middle-income family to spend about $241,080 for food shelter and other necessities to raise a child from birth to age 18.

Report finds rural Americans spend less to raise a child; food costs remain mid-range item on list of costliest expenses for all geographies

The study also created an average cost for each of seven expense categories: housing, food, transportation, clothing, health care, child care and education and miscellaneous. Estimates are based on the second child of a husband-wife household with two children and middle income.

Out of all of the categories, housing received the largest share of expenditures on a child from birth through age 17, while healthcare, miscellaneous and clothing ranked at the bottom, each accounting for between 6% and 8% of total child-rearing expenditures.

In the middle were child care and education (18%), food (16%) and transportation (14%).

Rural America Least Costly Region To Raise A Child, USDA Says

Expenditures not only depend on location of the family, they may also reflect the income level of the household.

For a child in a two child, husband-wife family, annual expenses on average ranged from $8,990 to $10,230 for households with before-tax income less than $60,640; from $12,600 to $14,700 for households with before-tax income between $60,640 and $105,000; and from $20,930 to $25,180 for households with before-tax income more than $105,000.

Families with lower incomes, USDA said, were more likely to show a larger percentage of total child-rearing expenses going toward food (18%), with housing remaining the top cost.

USDA notes expenses are also likely to increase with the age of the child. This is explained by greater nutritional needs as they grow, higher transportation costs as children begin to drive and higher child care expenses for younger children.

When compared to 1960, the first year the study was completed, families in 2012 were spending less of their total child expenditures on food (24% vs. 16%) and much more on child care and education (2% vs. 18%).

The latest estimates also represent a 2.6% overall increase from last year's estimates, lower than the average annual increase of 4.4% since 1960.

For more, view the report, Expenditures on Children by Families 2012.

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