Parents have much to deal with financially, but some parts of the United States make the task more difficult than others, according to a MarketWatch article published on August 28, 2015.
A small family with two parents and two kids can get by on a modest income in many American cities, but supporting a family of four can easily exceed $100,000 in the most expensive areas, based on a study from the Economic Policy Institute. This means that $100,000 is necessary just to get by and doesn’t take into account savings, college funding, or any type of investment.
The results of this study from the Economic Policy Institute paint an expensive picture for parents in much of the nation. The survey studied 618 metropolitan areas and found that the most costly expense is childcare, costing an average of $12,500 per year for two kids. Other cash- draining expenses include food, taxes, and health care.
Leading the list of expensive cities is Washington D.C. This shouldn’t surprise anyone, as the nation’s capital is well known as a place where real estate, rents, and daily living are very expensive. Probably the most shocking is child care expense. In Washington D.C., it will cost a family of four an average of $31,158 just to cover this one cash outlay.
Other cities ranking in the top ten most expensive places to raise a family are generally found in the American Northeast, mainily New York and Connecticut. In the western U.S., San Francisco and Honolulu are the only two cities to crack the top ten. San Francisco leads the way in housing costs, with an average of $23,472 annually while Honolulu claims the top spot for food, with an average annual expenditure of $11,244 for a family of four.
Parents have much to deal with when it comes to child rearing and these problems are only compounded when essential living expenses take a large portion of the paycheck. Fortunately, most of the United States population lives in places where a modest income is more than sufficient to cover living expenses and leave some money for savings and investment. The Economic Policy Institute study shows that $63,741 is the national median income necessary to pay living expenses for a family of four. If both parents work, this averages out to about $31,871 per adult and this is certainly within the grasp of most parents, even if they have only an average level of education.
Those who live in one of the more expensive regions of the United States may experience greater financial strain and may need to add additional jobs just to make ends meet, but the good news is that most of the American population makes enough money to cover necessities and still have money left over at the end of the week. What they chose to do with that money is another issue.