Aussies spend an average of $12,823 on their kids per year. Couples planning to have children aim to save more than $31,000 to ensure they have enough funds for all the initial expenses. An estimated $6,572 is spent on education and childcare every year. Kids receive an average of $21 pocket money a week.
How much does it cost to have a baby in Australia? The cost of having a baby in a hospital ranges anywhere from $1,500 to $20,000 as we covered in our article on how much having a baby costs.
Whether you're planning to have a baby or not, it's a good idea to save about 20 percent of your income for future goals. And if you're planning for a baby, you might want to save a little more to help you through the first couple years.
For newborns, the cost is higher. Some studies show numbers ranging from $20,000 to $50,000 for the child's first year of life, depending on location and household income.
The Australian government estimates that raising a single child can cost at least $170 a week.
You have a steady income
A stable income will ensure you are able to cover everything that has to do with preparing and growing your family. Consistent income will allow you to have certainty around expenses that will start to come with this new responsibility, and it will also allow you to plan financially.
Monthly, you could safely plan on spending between $250 (no child care) and $1500 (with child care) a month on your baby.
Focus on your emergency savings
When single parents are in survival mode, they often forget about a crucial part of their savings: their emergency fund. Every emergency fund should have three to six months of basic living expenses (housing, food, bills, etc.) put away for that rainy day.
The cheapest way to give birth is usually at home. With a home birth, you aren't paying the enormous hospital fees, but there are also more risks involved. Delivering at a birthing center can also be cheaper than a hospital birth.
Savings by age 30: the equivalent of your annual salary saved; if you earn $55,000 per year, by your 30th birthday you should have $55,000 saved. Savings by age 40: three times your income.
You may be eligible for Newborn Upfront Payment and Newborn Supplement if you or your partner have a baby or a child comes into your care. This information was printed 19 June 2023 from https://www.servicesaustralia.gov.au/newborn-upfront-payment-and-newborn-supplement.
The Newborn Supplement is calculated based on your income and the number of children in your care. The most you can receive is $1725.36 for your first child and $576.03 for subsequent children (as of April 2022).
Baby talk is (not) cheap as 56% of Aussie couples underestimate just how much it costs to raise a child. The Choosi Cost of Kids Report 2023 revealed the estimated annual average spend on child(ren) is $12,823 per household. Aussies spend an average of $12,823 on their kids per year.
Some of the biggest costs for new parents include healthcare (including birth), diapers, formula, childcare, baby gear, clothes, food, and toys. In fact, you can anticipate spending between $9,300 and $23,380 per year per child.
You might think it's impossible to afford a baby on a tight budget, but as long as you don't go overboard on baby gear, and make sure to prepare ahead with research and a solid spending plan, there's no need to wait to expand your family.
Baby formula can cost $1000 or more for a baby's first year, according to the U.S. Surgeon General. In reality, the expense can be much higher depending on your baby's needs and your formula preferences.
Meanwhile, collaborative database Expatistan estimates the current cost of living in Australia is roughly $3,803 per month for a single person or $7,064 per month for a family of four, just for the bare essentials.
What Medicare covers when you give birth. When you give birth, we may pay for services given by midwives and obstetricians. If you give birth in a hospital you can choose to be a public or private patient. As a public patient at a public hospital, you won't have to pay.
Without Medicare, giving birth in a public hospital without any complications costs upwards of $5,000. The price of giving birth in a private hospital is upwards of $8,000. Keep in mind that most backpacker insurances don't cover pregnancies.
A general rule of thumb is to have one times your annual income saved by age 30, three times by 40, and so on.
20% of Your Annual Income
Alice Rowen Hall, director of Rowen Homes, suggests that “individuals should aim to save at least 20% of their annual income by age 25.” For example, if someone is earning $60,000 per year, they should aim to have $12,000 saved by the age of 25.