BOSTON, July 11, 2024 /PRNewswire/ — A new study by CardRates.com is shining a light on the financial realities of child care in the United States, revealing significant gaps in Americans’ perceived expenses of a baby’s first year and the actual costs.
“It may be impossible to estimate exactly how much you will be spending on your child’s first year of life, but it is definitely worth trying to get as close as you can,” said Erica Sandberg, CardRates.com Finance Expert. “It’s best to overestimate the costs so you have money left over rather than underestimate them and then fall short.”
Methodology
To determine where the biggest misperceptions lie, the study analyzed five key expenses associated with a baby’s first year — day care, diapers, formula, food, and new clothing. Those expenses were then compared to survey responses from more than 2,000 Americans, asking them to estimate the annual cost of the five child care expenses mentioned above.
Perceived vs. Actual Day Care Costs, State by State
The study found that residents in over half of the states (56%) underestimated their average annual day care cost. The national average is $13,266. Survey respondents, however, estimated it to be $12,055, a 10% shortfall.
The 5 States Where Residents Most Underestimated Annual Day Care Costs:
- Massachusetts
- New York
- District of Columbia
- Hawaii
- Colorado
The 5 States Where Residents Most Overestimated Annual Day Care Costs:
- Oklahoma
- West Virginia
- Georgia
- Louisiana
- Pennsylvania
The Price Tag of a Baby’s First Year: Perception vs. Reality
Astonishingly, all states underestimated the financial costs of having a baby by 37%. Survey respondents estimated the cost at $15,177, while the actual figure is $22,111. Respondents from New Hampshire and Massachusetts were the closest, missing the mark by $2,099 and $2,769, respectively. In contrast, respondents from Mississippi and Alabama underestimated the cost by over $12,000.
For more information about the study and its findings, visit CardRates.com.
About CardRates
CardRates.com is dedicated to helping individuals make informed financial decisions by providing expert guidance and up-to-date information on a range of financial topics. From credit cards to family finances, CardRates.com is your trusted source for navigating your financial journey with confidence.
Media Contact
Kyle Beaman
[email protected]
703-596-1353 ext. 128
SOURCE CardRates.com
Originally published at https://www.prnewswire.com/news-releases/new-survey-uncovers-misperceptions-of-child-care-costs-by-state-302193873.html
Images courtesy of https://pixabay.com
