Raising a child in the United States is becoming increasingly expensive, as revealed by LendingTree's 2025 report. The annual cost has surged to nearly $30,000 in many states, driven primarily by rising day care fees, food expenses, and health care costs. This significant increase poses a substantial financial burden on families across the nation. Over just two years, the average annual expense jumped from $21,681 to $29,419, marking a 35.7% rise. Furthermore, federal tax credits have become less effective, with the Child Tax Credit decreasing by 44.4%. These changes highlight the growing challenges parents face in managing their finances while raising children.

The disparity in child-rearing costs varies significantly between states. For example, Hawaii tops the list with an annual cost of $36,472, whereas Mississippi remains the most affordable at $16,490. In Georgia, despite being one of the more affordable states for raising a child, costs are still climbing, reaching $19,162 annually. Day care emerges as the largest single expense nationwide, especially in Georgia, where it accounts for $11,066 per year. The variation in these costs underscores the need for state-specific policies to address affordability concerns.

Financial Pressures on American Families

The economic strain on families due to escalating child-rearing costs is undeniable. With the average annual expenditure increasing by over a third in just two years, parents are facing unprecedented financial challenges. Day care, food, and health care costs have risen sharply, making it difficult for families to keep up without substantial sacrifices. Federal tax credits that were once beneficial have now diminished in value, exacerbating the financial burden on households.

Day care costs have skyrocketed by 51.8%, averaging $17,836 annually, while food and health insurance premiums have also seen notable increases of 29.6% and 25.0%, respectively. This trend suggests that even with dual incomes, many families may struggle to cover these essential expenses. Additionally, the reduction in the Child Tax Credit from $3,600 in 2023 to $2,000 in 2025 highlights the diminishing support from federal programs. As a result, families must explore alternative strategies to manage their budgets effectively, such as seeking community resources or adjusting childcare arrangements.

Regional Variations in Child-Rearing Expenses

While the national average provides a broad overview, regional disparities reveal a more nuanced picture of child-rearing costs. States like Hawaii face exceptionally high expenses, with total costs exceeding $300,000 over 18 years. Conversely, Mississippi and Washington D.C. remain relatively affordable, with total costs under $200,000. Georgia, positioned near the lower end of the spectrum, still experiences a 14% increase since 2023, reflecting broader national trends.

Georgia's specific data illustrates how regional differences can impact family finances. Although it ranks among the more affordable states for raising a child, infant day care remains the largest expense at $11,066 annually. Other significant costs include food ($1,921), rent ($612), health insurance premiums ($2,373), and clothing ($239). Despite these figures, Georgia parents spend only 15.9% of their income on child-related expenses, which is below the national average of 22.6%. However, the minimal value of exemption credits—subtracting merely $165 from total costs—indicates limited relief for families. Policymakers might consider tailored solutions to alleviate the financial pressure on families in regions experiencing rapid cost increases.