How Much Do You Need to Raise a Child?
Until you’ve raised a child yourself, you may not understand the total costs. Even experienced parents often underestimate how much they are spending on one child and how much an additional child will affect the family’s finances. For families who are already living on a tight budget, a child can bring a whole new list of expenses that a family simply can’t afford. As a parent, it’s your duty to care and provide for your child to the best that you can, so it’s critical that you understand the actual costs before you decide to raise a child.
Total Costs of Raising a Child
In a report released by AMP and NATSEM, the average cost of raising two children until age 21 for a middle income family is Australia is $812,043. That’s over $400,000 per child, and over $450 a week per child. However, many of these costs are variable, and they depend on how much a family chooses to spend on food, housing, schooling, and entertainment. A low income family spends almost half this amount on two children: $474,280. In contrast, high income families in Australia spend an average of $1,097,278 on two children. What’s most alarming is that these expenses continue to rise every year, and they are rising faster than income in Australia. Some of the highest individual costs for children include transportation, food, and education.
The highest single cost for both low income and middle income families is transportation. Low income families spend roughly $100,000 on transportation for two children, while middle income families spend $160,000. This includes the cost of buying additional cars, buying bigger cars to accommodate children, and all of the petrol costs to take them to school and activities.
Keeping your children healthy and well-fed is also a major expense; it’s the second highest cost for low and middle income families as well as the third highest cost for high income families. The costs for families are approximately $90,000, $145,000, and $170,000 respectively. Like in other areas of child-rearing costs, the different income groups spend different amounts of money as it’s possible to spend less money on food, though the quality and nutritional benefit may be lower for less expensive foods.
Education costs are an interesting part of families’ finances, because they vary dramatically depending on your income level. Low income Australian families simply can’t afford to send their children to private schools, which can cost as much as $216 a week. As more middle income families are choosing to take their children out of school, and as a large amount of high income families are already doing so, they are seeing an extremely large amount of their savings go towards education. On average, education costs are $22,000 for low income families, $45,000 for middle income families, and $190,000 for high income families. Unfortunately, the best schools come with a large price tag, and deciding where you want to send your children to school is a financial decision more than anything else. These are only a few of the most notable costs of raising a child, but there’s also housing, healthcare, clothing, and other costs. For many families, these costs can quickly get out of control and be much more than they expected, so it’s important to save and be aware of these costs before raising your first child.
If you have a child on the way, or simply want to better manage your family’s finances, we have regular monthly events where you can learn from our financial experts through our Financial Edge event Series. Get in touch with us for information about our next event.
Equus Partners Wealth Management and Chris Nairn are Corporate Authorised Representatives of Capstone Financial Planning AFSL/ACN 223135, Australian Financial Services Licensee, Level 14, 461 Bourke Street Melbourne Victoria 3000
Rostering made easy – no more scraps of paper!
At Equus Partners, we are always looking for ways to save our clients time and money. Our latest revelation has been a series of scheduling and employee management systems. We are looking at eliminating those tedious manual processes that are taking you away from the rewarding work that is running your business. And we’ve got a game changer for you. A well-integrated cloud system that will have you saying goodbye to rostering and timesheet worries!
At the moment, this is how it goes…
It’s Sunday night. You’re either at the kitchen table or still at work! You spend hours planning out a roster for the week based on a really good guessing game you’ve been playing for a long time. And you know that chances are that your roster – scribbled all over some paper or spreadsheet – will resemble a piece by Pablo Picasso by the end of tomorrow after 80% of your team calls you to tell you they can’t work the shifts you’ve given them. Sound familiar?
Have you forgotten about how hard it is keeping on top of who’s taking leave and when? How about keeping a grip on making sure you’ve got the right people rostered on for the specific job/shift on the right kind of day? How about tracking which employees have been inducted at each site? How about managing employees who work across multiple sites? Paper is just not the answer.
We’ve been looking for systems that give managers and their employees the tools to work smarter and faster, and employee and timesheet management has been a huge part of that. There is the right scheduling and time management tool for every business big and small. You could be running a restaurant/cafe/gym/cleaning business/maintenance business/construction business. You’re going to love this – No more scraps of paper!
With the right technology, you can roster, communicate with, and apply and approve your employees’ leave with intelligent rostering capabilities. All in one system, you can roster staff according to their availability, training and even sales targets. Systems can even detect busy periods and lulls in your daily sales to roster on less or more team members. You can even project your capacity based on weather forecasts! You can always be sure that you’ve got the right people on at the right time.
Oh, and are you sick of being left hanging when team members call in sick? You can have your rostering kiosk automatically notify the rest of your team when a shift opens up by sending an alert straight to their phones! When a team members wants to pick up a shift, they hit ‘Accept’ and you’ve filled the gap in your roster.
And once the work week is done, export your time sheets to your accounting management system and have your payroll generated at the touch of a button! If you’re sinking hours into writing out rosters, verifying attendance, completing time sheets and pay runs every week, then you’ll want this in your life. Whatever your business, wherever you are, there is a rostering management system that will work for you, so please stop toiling over little bits of paper.
Get your POS on point!
Integrating new business software is difficult enough without considering the anxiety and FOMO you will experience from just googling “POS Apps”. Sometimes putting yourself at the mercy of a search engine is exactly what you need to render yourself paralyzed with indecision. Which Point of Sale (POS) application is right for your retail business? How many subscriptions should you buy? Do you actually have to buy all of this hardware? Can I set up my register with a CSV import? -Wait. What?
Anyone who has tried it, knows that choosing a POS system can be overwhelming enough to warrant tears and a 3 hour tea break. Those who are particularly adverse to decision making, will pick at random. Some will ask a friend or neighbour, and some will simply go for the most popular software on the market (I call this the “I’ll have what she’s having” method).
Almost every POS system out there will take an order and open your cash drawer now, so finding a POS system with the right features for your business can feel like it requires some soul searching. It can be tempting to buy the biggest baddest POS on the market, but since you haven’t got money to throw away, we’re going to help you find a POS system that will help you.
The best POS system for you will:
1. Only track data you need
In the age of big data it’s tempting to hoard data. If you’re a cafe, recording every customer’s shoe size, hair colour and pet’s name, then this probably means you’re wasting time and money.
2. Play well with others
Your POS software should be cutting down the work hours for you by reporting to your other accounting, management and scheduling systems. Recording orders and printing a huge receipt at the end of the day no longer cuts it. You can do better.
3. Be subtly extraordinary
With the data that is being collected, your POS system should be able to report and track trends in your sales and inventory, allowing you to make better decisions for the future.
Knowing what you need from your POS system is the key to unlocking this challenge! Having a systems analyst translate your needs can help with this. And then after all of this? Find the small features that you need, subscribe, plug in your hardware and gogogo!
If you’re like most people, you wake up in the morning and take a quick look at your face in the mirror on the way to the shower. If you like what you see, it’s a good sign you’re going to have a great day! For me, my budget and bank account balance is my financial ‘face’. Every morning, I wake up and log into internet banking. Do I smile or do I frown? Well that really depends on what I would like to see at that specific point in time. I’m smiling a majority of the time because I’ve put in place plans and budgets to guide me in reaching my financial goals, and my bank balance simply confirms my progress in achieving them.
Financial goals are really important. You may want to better your financial future, save up for the big spend of Christmas, plan for a holiday, buy your loved one something extra special or get yourself that pair of shoes you’ve been eyeing off in the designer store window. Whatever you want to achieve, you need a clear plan and a way of checking up on your progress.
Budgets are really important too. In a previous article, I wrote about key things to do when planning and monitoring your finances. To recap, you need to work out how much money you need and by when; then how much comes in, goes out and is left over each month. This is a simple budget. After you’ve juggled the numbers to make it work, and made a few sacrifices, this becomes your road-map. You need to follow this guide meticulously to ensure you meet your goal, whatever that may be. Of course, there will be bumps and road blocks along the way but with your guide in hand and a clear picture of the goal, you’re going to get back on track quickly. Imagine driving down the road trying to find an address you’ve never travelled to before, with only road signs to rely on and no planning done before you left home. Scary? Now imagine you did your planning before you left, printed out maps, visualized land marks, or programed the destination into your sat navigation system. This is my point exactly. Budgets are important.
You need to ask yourself a few questions: Do you know where you’re going? Do you know how to get there? Do you know when you’re going to get there?
The answers may be simple but they mean a lot. If you want to wake up every morning smiling because you know for a fact that you are on your way to achieving your financial goals, then you need to put some key things in place and you’ll get there!
If all of the above seems too overwhelming, or your need someone to keep you in check, then you’re going to need some accountability. A coach will review your situation, help you set goals, monitor your spending, and provide a solution that wont negate your savings with exorbitant costs.
Our firm, has developed a hassle free savings management solution called Cash Flow Coach. Our clients love it. Check it out here.
The information contained in this article is general in nature and is not intended to represent tax or financial advice. As each person’s circumstances are different, independent advice should be obtained prior to any action being implemented.
After months of planning, developing, testing, and developing and testing (We’re tired just thinking about it), the new Equus Partners website is live. WELCOME!
It has been a while in the making now but the team is elated with the completion of the site. We’ve certainly put in hours getting it together, which wouldn’t have been possible without the awesome assistance from our friends at Straight Arrow and Michelle Elias at Lime Media.
Now it’s here, I’d better tell you a little about it. Unfortunately, we’ve (accountants) been plagued by generalists as being a ‘boring’ bunch. THEY’RE WRONG! And hopefully, by taking a tour of the site, you’ll see why we’re not boring. We’ve concentrated on delivering our content by video wherever possible, including our overly animated services page – Check out Nadi and Chris in action. In a few clicks, you’ll get a quick intro about us, learn about Our Why, and then get amused at how passionate we are about the wealth-creating services we provide to our on-the-road-to-success clients. Take a look and let us know what you think.
The reason we created this site stemmed from our desire to climb the tallest mountain and shout out from the rooftops, telling the world about our values and our culture. Let me share them with you:
WORK HARD PLAY HARD – We promote a culture of work-life balance internally and for our clients.
DO IT RIGHT – If we do it, we do it right the first time.
FOREVER FORWARD – We’re always finding ways to improve ourselves, every day and in everything we do.
ALWAYS TAKE ON A CHALLENGE – We never back down from a challenge and are always determined to succeed.
PRACTICE WHAT WE PREACH – We do what we say and we say what we do. If we advise it, we’ve done it ourselves.
WORK TO LIVE – We love what we do but we know to be successful in what we do requires having substance to our lives and an amazing life outside of work.
These values are what makes us and keeps us in check. We live, breath and work these values day in day out. We’re proud about them.
The other reason we created this site came from our years of success in offering value-added packaged services. For years we’ve been engaged by our clients on a fixed-fee, monthly payment, almost-all-inclusive package basis and we’ve never told anyone else about it. We’re proud of the way we work, and our offering, and would love for others to know about it. When you get a chance, take a look at our awesome packages.
Again, welcome and enjoy. Take a look around our new “place”. Let us know what you think. We’d love to see you more often too!