It would be impossible to list all the costs associated with raising children. As a parent, you’ll spend on a wide variety of goods and services, starting the day they’re born and lasting until you’re ready to stop.
A 2022 report from The Brookings Institution estimated the total average family expenditures on a child born in 2015 to a middle-class, two-child family in the United States to be $310,605.
You hopefully anticipate and can manage some costs like clothes and food. But other costs can be far more expensive — and come out of the blue. When they do, they can blow your carefully constructed budget out of the water.
The following scenarios might not occur in your family’s future but you never know. If they do, here’s what you need to consider — and how you can keep them from throwing your finances out of whack.
Academic Help
Your child has suddenly fallen behind in school and is now having trouble keeping up. When that happens, you may want to sign them up for summer school classes or tutoring.
“Planning for beyond-school support, whether to fill in gaps or enrichment, is a key element of academic planning,” Rebecca Mannis, Ph.D., learning specialist and founder of New York City-based Ivy Prep, says.
“Here, ‘less is more’ may not be realistic. Caveat emptor, as tutoring is largely an unlicensed field,” she says.
After getting recommendations from friends and teachers, Mannis urges parents to spend time understanding a learning specialist’s approach and methods. According to Tutors.com, you can expect to pay somewhere between $25 and $80 an hour for the service, so you need to ensure it matches your child’s needs.
Before paying, though, find out if you can get help for free through the school’s individualized education plans. If it will be coming out of your own pocket and your child has diagnosed learning challenges, you may be able to deduct the costs from your taxes.
[Read: Tax Write-Offs You Shouldn’t Overlook.]
Sports and Talent
Your child is fascinated with football, figure skating or the flute — and paying for these activities wasn’t in your financial playbook.
It’s great to encourage extracurricular activities, but set clear boundaries. Coaches and instructors make many demands, so it’s important you to talk to your child about your personal parameters.
“Be realistic with your child and help them prioritize,” Mannis says. “Not only will this help create realistic financial expectations, it also helps kids problem-solve how to pace things.”
If your older child is truly committed but paying for everything is a financial burden for you, have a conversation about ways you can make it happen with their contributions.
“This might motivate your kid to earn some extra money for what he wants,” Mannis says. Perhaps they can take on a job like babysitting or lawn mowing to earn money for the new football gear they need.
Accidents and Medical Needs
From skateboarding spills as teenagers to getting banged up in a vehicle crash when they start driving, accidents can put your child in the hospital — and you in debt.
Kids often take risks that can result in broken bones and big medical bills, so if you know your child is especially active or adventurous, it’s time to strategize.
Rick Nott, certified financial advisor, certified private wealth advisor and senior wealth advisor at LourdMurray in Los Angeles, says a good first step is to consider modifying your health insurance plan.
If you have a high-deductible health plan, the premiums are low, but you can be on the hook for plenty in the event of an accident. A preferred provider organization plan may be more prudent for active kids, since the deductible and out-of-pocket costs will be lower.
If you have a high-deductible plan and don’t want to change it, try maximizing a health savings account. For 2023, the IRS allows you to set aside up to $1,950 in an HSA. Contributions are tax deductible and when you make them through your employer they are pretax, which can reduce your taxable income.
[Read: How to Choose a Health Savings Account.]
When accidents do happen, make sure you review the bills and prepare to fight unnecessary or elevated costs.
“My son was unexpectedly born at home and we found out the hard way,” Nott says.
“They tried to charge us for an in-hospital birth. Unlike most everything else you buy, you don’t know the price in advance. Even if they take insurance, it may not be fully covered. Get in the habit of looking at the paperwork and asking questions before you sign. Aspirin in the hospital can be $30 a pill, and that can be disputed. They will often negotiate with you after the fact, too, so call and start talking,” he says.
Trips and Activities
Your child has a friend from a well-off family who invited them on their annual ski trip. It’s a lovely offer but it means you’re expected to cover everything from airfare to lift tickets.
If you don’t have the money to spare, don’t feel obligated. This situation will come up again, so get used to saying no. Everybody’s financial picture is different and it’s not your responsibility to keep up with the Joneses.
“A big theme in my practice is values over money,” Nott says.
“Take these opportunities to teach your children. Explain that they can do things with their friends at the beach or have a picnic instead. Or, have your child contribute to the event if they really wants to go. And if it’s not possible, that’s OK. It’s not the end of the world,” he adds.
Your child probably won’t see it that way at the time, so Nott recommends preempting the agony. Speak about money early and often, and explain income, expenses and the perils of debt.
[READ: Ways to Teach Kids About Money.]
Extra Child Care
Like many parents who have to work all year, you may have already started to prepare for summer costs like overnight and day camps.
School breaks, teacher retreat days and long weekends, however, can appear on the calendar more often than you expect. When the children are young and can’t be home alone you will likely have to pay for child care, which can cost a small fortune.
According to UrbanSitter, $22.68 per hour is the 2023 national average hourly rate for babysitting one child and $25.37 per hour for two children.
Although you can keep these costs down by asking a relative or trusted friend to pitch in, at some point you will probably have to pay. This is a good time to consider opening a slush fund for these types of unexpected expenses.
“In terms of budgeting, whatever you think your expenses will be, increase them by 20%,” Nott says. “Add it to a savings or money market account. Or, open a Roth IRA. After five years you can take your initial contribution out for those types of things without paying penalties and taxes.”
Mental Health Care
Many children struggle psychologically, and you may be identifying signs in your own. A 2023 Pew Research Center report found that mental health was the greatest concern among today’s parents.
Your child may require assistance from a professional therapist, yet counseling can be extremely expensive. Even when an insurance plan covers these sessions, not all therapists accept it.
A single session with a therapist runs between $100 and $200 per hour, which can be overwhelming for families just getting by.
Instead of forgoing this important care, look for a therapist who accepts sliding scale payments. And research online therapists because they tend to have lower rates than those who have to pay for office costs.
This is where a fully funded HSA can be a godsend, Nott says. If you maximize your contributions, the cash in that account can cover many months of essential counseling sessions.
Alcohol and Drug Addiction Treatment
According to the National Center for Drug Abuse Statistics, 1.19 million 12- to 17-year-olds reported binge drinking in the last month, and 2.08 million reported using drugs in the last month.
The problem is real — and devastating.
The good news is, the Affordable Care Act requires all health insurance providers to cover drug and alcohol rehab services. The bad news is, it’s not as easy as it sounds because your insurance plan may not provide enough coverage for what your child needs.
For example, it may cover only 30 days at a residential treatment center, which might be insufficient. That means you’ll be picking up the rest of the cost. The NCDAS reports that the average cost of drug rehabilitation is $13,475, an insurmountable sum for many families.
State, city and county governments — as well as some nonprofit organizations like the Salvation Army — offer free in- and outpatient treatment. To learn who to contact, visit the the Substance Abuse and Mental Health Services Administration directory of state agencies.
You Can’t Prepare for Every Child Cost
In the end, it’s important to recognize that there’s only so much you can do to prepare for high expenses related to children. Just do your best to project and plan. That way, if you do have to cover one or a few of them you won’t be caught completely off guard.
More from U.S. News
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Extreme, Unexpected Kid Costs: How to Plan for the Unplanned originally appeared on usnews.com
