How much does it cost to raise a child until age 18?

The arrival of the first daughter changed the routine of screenwriter and presenter Dante Baptista. He started working two jobs after the birth of his daughter with his wife Rosana. The dream of having children took two years to come true. The couple spent around R$100,000 on fertility treatment and, despite having prepared themselves financially for Dandara’s arrival, they were still shocked by the family’s costs, which rose by 50%.

“We were surprised by the expenses. We didn’t imagine we’d feel the squeeze on everyday accounts. The cost went up a lot when she started to have solid food. We want to lower the cost of living and we don’t even know where to start,” she says.

Baptista started working 12 hours a day or more to cover all expenses and to build a financial reserve for Dandara’s education.

“Today, I work in two places to manage Dandara’s creation with peace of mind, without detracting from her quality of life and without running out of money at the end of the month. Next semester, she’ll go to school, initially, to a public school. In the future, in elementary school, we should move to a private school, ”she says.

For the screenwriter, all these costs are worth it, but he knows that the financial journey is long. In Brazil, especially in large cities, where the cost can rise by up to 50% compared to other municipalities, spending on a child up to the age of 18 has become a millionaire barrier for the middle class. This is what shows a study carried out by Insper at the request of Estadão, conducted by Juliana Inhasz, professor and coordinator of the institute’s economics course.

For families that make up class C – those with a monthly family income of R$ 5,281 to R$ 13,200 -, the estimated expenditure varies between R$ 480,000 and R$ 1.2 million. In class B (between R$ 13,201 and R$ 26,400 monthly income), spending ranges from R$ 1.2 million to R$ 2.4 million. In class A, it starts at R$ 3.6 million and continues to rise depending on family income.

“The cost of living has increased. As the work is based on the IBGE income classes, which define income classes according to the number of minimum wages, when the minimum wage goes up, the cost also increases”, says Juliana.

The survey was based on income class data from the Brazilian Institute of Geography and Statistics (IBGE) and points to an average expenditure of 30% of household income on children. The list of costs considers, for example, food, clothing, leisure, education, health and part of common expenses such as rent. Juliana ponders, however, that those who have more than one child tend to have a dilution of costs.

In São Paulo, 50-year-old content producer Helvânia Ferreira Aguiar’s entire salary goes to her children’s education. In the division of the household budget, her husband is left with more general expenses, such as rent, condominium and supermarket. “It became almost an impossible mission to pay for education”, she says.

During the pandemic, Helvânia even delayed the payment of tuition at a private school in the West Zone of the city. The financial situation got complicated, because her husband, owner of a communication agency, lost almost all of his clients. “We were left with my salary. It was a save yourself who can, ”she says. The oldest, aged 18, entered a public university this year, and the youngest, aged 13, managed to stay in school.

“We were delaying the installments. At the end of the year (2021), we needed to re-enroll them and we went to talk to the school’s treasury. They paid fines and interest and paid the overdue monthly payments in installments,” says Helvânia. The youngest’s monthly fee will be paid in 12 months, and the oldest’s in 18 months – the debt should only end in the middle of 2024.

Reinforcement of social inequality

Insper’s survey also shows that spending on raising children increases with family income, which reinforces the unequal aspects of Brazil. Among the richest, investment is at least 15 times greater than in the comparison with class E and three times in relation to the middle class.

“We talk a lot about such income distribution, but you can understand why this is perpetuated. It is very difficult to put someone from class D or E to compete with someone from class A. The difference in investment in children is absurd”, says Juliana. It is worth noting that the study presents average values ​​and does not include, for example, the expense of parents and more land or couples who need fertility treatment.

Ensuring that children from all social classes have equal conditions is important, as investments in early childhood are considered fundamental to permanently improving their trajectory. “It is in this phase that not only the child’s cognitive capacity changes, but also the behavioral issue, the ability to make an effort, resilience”, says Marcelo Neri, director of FGV Social.

Since 2014, with the economic crisis of the following years and the damage caused by the pandemic, Brazilian families, especially middle-class ones, have seen their personal budget decrease and have lost the ability to consume private sector products, such as education and health.

“At the time, research showed that the big brand (of the middle class) was access to goods and services offered by the private sector and that they were of better quality. This process, however, suffered a deterioration, because people’s income dropped or because the State lacked money”, says Neri. “Everyone went back to the public sector, which was kind of strangled, and the pandemic was the continuation of this sequence”, he says.

planning is ideal

In the ideal scenario, the arrival of a child should be financially organized one or two years before birth, says Ana Paula Netto, financial planner at Planejar. In the period leading up to the birth, it is essential to list all expenses that can be foreseen and start to gather resources for future expenses.

It is important, says Ana Paula, that each family adapt costs to their financial reality. “Do what you can within your means. It’s no use building a super room and getting into debt. See what fits in your budget.

In the child’s childhood, if possible, it is also advisable to think about a financial reserve for the future, especially for school expenses. “During the growth and development of the child, the suggestion is to make a reserve to pay for education expenses”, says the specialist.

She says it’s important for parents to know their own budget well, writing down all income and expenses. “It is important for parents to also take care of their future, think about their future, not to become a burden for their children.”