Commentary

Kids Cost Money!

Based on 2013 Gallup Daily tracking, asking Americans about the amount of money they spent on purchases "yesterday," excluding normal household bills and major purchases, Americans without children under 18 reported average daily spending of $79, while Americans with children reported a $108 daily average.

Americans’ Daily Spending With and Without Children (Dollars, 2013)

 

Daily Spending

Demographic

No Children

Children < 18

Children ≥18

Monthly Income

   < $3,000

$53

$80

$55

   $3K - <$7.5K

73

103

88

   ≥$7.5K

121

171

151

Age

   18-29

61

100

-

   30-49

86

110

82

   50-64

81

106

92

   65+

69

137

77

Source: Gallup, March 2014

Even among adults in the same income group, there is an incremental bump in spending as a result of having children under 18, says the report. This could be the result of having more people in the house for whom to provide basic necessities, including food and clothing. In addition, there is a whole separate class of expenses that are common for parents, including children's extracurricular activities, books, toys, and games. Overall, the presence of children is clearly related to a higher outflow of money on a daily basis.

Once children move beyond the age of 18, says the report, parents’ spending appears to drop back down, approaching the levels found among those without children. This holds true across most income and age groups. In all demographic groups but one, spending is lowest among those without children, rises among those who have children under the age of 18, and then falls among those whose children are age 18 or older, says the report.

The total number of children under the age of 18 also affects the amount Americans spend. Aside from those with no children younger than 18, parents with one child in this age category spend the least ($96 per day), while those with five or more spend the most on average ($145). Overall, there is a clear, upward trend, concludes the report: The more children under 18 there are in a household, the more money parents spend on a daily basis.

The research shows that marital status affects daily spending. These data show that having children younger than 18 has an effect on daily spending that goes above and beyond other demographic factors such as income, age, and marital status.

The drop in U.S. fertility rates in recent years, documented by the Centers for Disease Control and Prevention, may have had a negative effect on consumer spending. The good news for the economy is that Gallup research also shows that there may be a pent-up fertility demand in the American population. If the fertility rate does increase in the years ahead, consumer spending may increase correspondingly.

Americans’ Desire To Have Children (% of Respondents)

Current Situation

1990

2003

2013

Have children

73%

72%

74%

Don’t have, but want children

17

16

16

Don’t have children, but would like to have done so

3

6

3

Do not want children

4

4

5

Source: Gallup, December 2013

Results for this Gallup poll are based on telephone interviews with a random sample of 172,556 adults, aged 18 and older, living in all 50 U.S. states and the District of Columbia. For results based on the total sample of national adults, the margin of sampling error is ±1 percentage point at the 95% confidence level. For results based on the total sample of Americans with children under 18, the margin of sampling error is ±1 percentage point at the 95% confidence level.

For additional information about the study, please visit Gallup here.

 

 

 

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