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| Expensive Kids | | Border Business | | Sajjad Bazaz
None of us gives attention to the cost of raising a child!Today, education is the biggest expense faced by families.
Steep rising cost of essentials has frustrated everyone. Commodities once known as comforts and luxuries have today become necessities. This has led to the increasing frustration of those who are living on the financial edge. One of my psychiatrist friends attributes large scale depression, extreme stress and helplessness among people here to this uncontrolled rising cost of living. For him anti-depressant and anti-stress drugs won't help much. He suggests that people should negotiate rising cost of living by spending as per their income and cutting down on unnecessary expenses to stay afloat.
Since my childhood I have always found financial pressure around people and I never heard people talking about relief in prices of essential commodities. So it's not a new phenomenon. However, there's a big difference between eighties and today's era. Earlier there were constraints which forced people to live as per their financial limitations. Today, it's not so. Easy access to funds through bank loans has lured people to go beyond financial their means.
Rising cost of living is a global phenomenon. Amid this situation, one of the neglected areas of concern has been the cost of raising a child. In our culture, home is considered the biggest investment most people will ever make. But they never think of the volumes of funds incurred for raising their children from cradle to the college. This cost of raising children far exceeds their average home price.
With the increasing cost of living, birth of a child and nurturing him/her to adulthood is proving a pricey affair for the parents. I could lay hand on an international study about the cost of a child 2012 report, which reveals that it costs 120 percent more today to educate a child to the age of 21, compared with 2003, while the cost of childcare has soared 57 percent over the same period.
Precisely, having a child is very expensive. Let me add some major expenses which add to your domestic budget immediately a new little member joins your family.
This can be stressful for most of the parents, as their income gets reduced. Immediately once the baby is born, one of the biggest expenses is the medical care cost, which is today very expensive for infants. Since health conditions of a child tend to fluctuate, no parent can afford compromise on health of the child.
Notably, medical costs have been found high in the initial years, but they remain low if there is no major illness.
Then there's education cost. Every parent wants his kid to be educated in a good school and good education is the right of every child. Let me quote a national survey (ET Wealth estimates) which says raising a child in urban areas from cradle till college costs is roughly Rs 55 lakh. The calculation assumes that the child will take up a professional course costing Rs 10 lakh. This is the cost at today's prices and the amount has to be adjusted for inflation. Now comes the scariest part. Education costs, which constitute nearly 46% of the total expense on a child, are growing at a worrying pace of 20-25% per year.
So, education is the biggest expense faced by families.
Of late, electronic gadgets have added to the financial pressure on parents as they have to fork out for the cost of laptops, iPads etc. Interestingly, it has been found in a study that entertainment is a major expense, higher than healthcare and transportation combined in raising a child.
Parents with limited income, which most of us have, face financial stress on account of the diet of a child. In the growing years, the child will necessarily need lots of nutritious food for his well-rounded development. Despite costlier baby food items, no parent can afford to compromise on the child's heath by cutting down the nutritious food. So, this would mean extra expenses.
Let me also put some facts revealed in a national study. As child grows, so do his demands. With every passing year, some of his needs increase, while others wane. For instance, healthcare costs are the highest till the child is 4 years old, whereas education costs form a huge chunk of expenses between 17 and 21 years. 50% of the total expense on healthcare is incurred in the ?rst three years of the child's life. Interestingly, it has been found that parents spend three times the total healthcare cost on a child's entertainment. This is mostly due to the high cost of gadgets, such as mobile phones, that children consider essential.
Meanwhile, there is no sign of the cost of raising a child getting any cheaper. So there's every chance that the rising cost of having children may force many parents to work extra hours.
However, this entire stressful financial situation in raising a child doesn't mean that you should remain childless. What is needed is the kind of proper budgeting of expenses with your eyes wide open. Once you evaluate the costs and come up with a plan to cover them, you can in real sense enjoy the new addition to your family. Don't forget, children may be pricey, but they are priceless gifts of Allah.
(The views are of the author & not the institution he works for) |
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