When you're pregnant for the first time, there's so much to think about. Baby names, decorating the nursery, and feeling those first little kicks may be some of the things on your mind. While in an ideal world, every parent has the resources and support they need to raise children, we know that the cost of starting a family is something many are concerned about.
According to a report on parenting expenses across America, raising a baby is 20% more expensive in certain states than it was a decade ago. With the cost of living being so high, it can be scary to bring a little one into the world without a solid plan. Rest assured, if you're worried about the cost of raising your little peanut, there are a lot of ways to save money, and preparing for the unexpected is the best way to set yourself up for success.
The Cost of Raising a Baby in 2025
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When you see a positive pregnancy test for the first time, you might not be thinking about the cost of having a baby right away. But over time, questions about hospital bills, daycare, and even college tuition might pop into your head. While there are many costs involved in raising healthy children, some of the highest costs include childcare, food, and healthcare.
The overall cost depends on your family's situation, however. If you or your spouse have healthcare available through an employer, the costs will be different from those of a family without that option. If you're a stay-at-home mom, you may not be paying for childcare, but as a one-income household, you may have fewer funds available.
Thinking about the real cost of raising children can be overwhelming for parents, especially when you start to think about their future. But the problem isn't just that the cost of raising children is higher. Most people are paying more for everything, regardless of how many children they have.
Posh Peanut, a children's clothing brand, conducted a report in November 2025 on the affordability of raising a family. In response to the findings, Posh Peanut's CEO stated:
“Baby costs aren't rising alone. The overall cost of living has jumped nearly 30% in the last decade, and college tuition has become nearly impossible to afford for many households. When you add up all these increasing costs, it's no surprise some are making tough choices about whether they can afford to have children at all.”
States With the Highest Rise in Cost
Parents everywhere are feeling the weight of the rising costs of raising children. But residents of some states are feeling it more than others. According to the 2025 report by Posh Peanut, the top 10 states where raising a baby has become hardest to afford include:
- Alaska
- North Carolina
- Missouri
- Minnesota
- Pennsylvania
- Wyoming
- Louisiana
- Washington
- Illinois
- Connecticut
In Alaska, for example, the annual cost of raising a child in 2015 was $26,035. In 2025, that cost has increased to $32,947 — a 27% increase in 10 years. Despite this significant increase in cost, the median income in Alaska went down 6% from $96,750 to $91,260. According to the report, Alaska is the only state where wages have fallen, making it one of the most challenging states to raise a baby.
In other states, the cost is even higher. The annual cost to raise one young child in Connecticut in 2025 is $41,810, which is a 23.9% increase from 2015.
Things to Consider When Preparing for Your Baby's Arrival
Considering how expensive it can be to raise a child, there are some things to discuss before your little one arrives. Some of the highest costs will include healthcare, childcare, and food. Here are some things to consider:
One Income or Two
One of the highest costs for families is childcare. If you're currently a two-income household, you might be considering the cost of daycare once your maternity leave is over. However, if you end up quitting your job due to this cost, you're certainly not alone. A major survey of parents in 2023 revealed that one in four parents in America had quit their jobs or dropped out of school due to the cost of childcare. Weighing your salary against the cost of childcare is an important step in determining what's best for your family.
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Breastfeeding or Formula Feeding
Another high cost for parents, especially in those first 6 months, can be formula. While breastfeeding isn't exactly “free,” considering how much time, effort, and support are necessary, the cost of formula is something for families to consider. According to SmartAsset, parents can expect to spend between $821.25 and $2,920 on formula in their baby's first year.
Healthcare Options
Healthcare is a necessary part of raising healthy children, although the costs of healthcare in America can make it challenging for parents. This is something to discuss before your baby is born. Do you or your spouse have healthcare available through an employer? Are you eligible for federally funded healthcare? If you haven't already, be sure you speak to your insurance company about adding your little one to your plan.
Unnecessary Items
There's nothing wrong with wanting to buy new things for your baby, whether you're splurging on a stroller or new clothes. It's important not to feel pressured to buy every baby item you see at Target. There are a lot of items that aren't necessary, and if you want to save on costs, focus on only buying what you really need.
Tips for Saving Money
No matter what your plan is for childcare or healthcare, there are many other ways to shop smart and save money in your family's budget. Here are some of our best tips:
Shop Second-Hand
There are some items you'll want to buy new to ensure they're safe for your baby. But many baby items, such as clothes or toys, can be purchased second-hand. You can shop at local thrift stores and consignment shops or search Facebook Marketplace in your local area. You can even check Buy Nothing groups to find things that other parents are giving away for free.
Search for Deals on Baby Items
Many new parents are shocked at how quickly their newborn goes through items like diapers and wipes. One of the best ways to save on these items is to search for deals and shop around to find the best price. Target, for example, frequently offers gift cards if you spend a certain amount on baby care items. While buying in bulk at stores like Costco or Sam's Club is an option, be sure to compare the prices since these items aren't always cheaper at wholesale stores.
Accept Help From Friends and Family
Not every parent has a village around them to help, but if you do, don't be afraid to ask for what you need. Some new parents specifically ask for gift cards or even cash instead of presents when a new baby is on the way. Even something simple like setting up a meal train for postpartum can take a lot of pressure off you in those early days of parenting.
An Encouragement for Worried Parents
The stress that may come with financial struggles, especially when you're raising children, is very real. Many families are struggling to buy even the necessities, let alone spend extra on things they want to purchase for their child. But if you find yourself worried about how you'll pay for it all, keep in mind that your love is what matters the most.
Even if you're not in a place to buy all the things you want in this season, if your child has what they need and you love them the best you can, they'll be okay. Saving for things in the future, such as college or their first car, can come later. Focus on what you can control in the present and love your babies the best you can.
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