Raising a Child Cost In India

Raising A Child Cost In India

Parents frequently worry about whether they can support their children’s growth, whether in terms of school or health since costs continue to rise yearly. So let’s examine the price of raising a child in a significant metropolis.


The price of raising a child varies from nation to nation. Raising a child depends on your lifestyle, living, and other choices. Therefore, the actual costs for your family may change. It’s crucial to keep to your spending plan and avoid making too many impulsive purchases of toys and clothing for your kids. More importantly, begin investing and saving for your child’s future.

Prepare an estimate of the amount you will need for each objective, such as your child’s school or marriage, and begin investing and saving for them right now. From the child’s birth, investing in mutual funds through recurring monthly contributions (SIPs) can assist in creating a sizable fund for the child’s education or future marriage.


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Pregnancy Costs And Prenatal Care

As a couple, you should have money set up during the pregnancy to cover costs for prenatal care and labor and delivery expenses. Then, when the child is born, there are several expenses, such as diapers, toys, baby items, clothing for constantly growing youngsters, and meals. These ongoing expenses might not seem substantial in isolation, but they will significantly influence your family’s budget over time.

The Child’s Formative Years

About Rs. 1 lakh is spent in the first year of a child’s life on pricey medications, shots, and infant care items in urban and semi-urban areas. The first significant cost of a child’s education appears when they become two years old in the form of a playgroup or creche. Depending on the amenities offered, this expenditure might be 50,000 to 1 lakh rupees. Spending on toys and clothing is significant early in a child’s life since the youngster frequently outgrows them.

Schooling Education Expenditures

As many as 65% of parents spend at least half of their annual income on their kids’ extracurricular and academic activities. Of course, every parent wants the most excellent education for their kid, but growing school costs can often make it difficult. A respectable school levies annual tuition of 50,000 to 2 lakh rupees.

Assuming a 10% yearly education inflation rate, the 12 years from Classes I to XII would result in an outflow of between 11 and 43 lakh rupees. These expenses are separate from the child’s tuition and extracurricular activities that they will be enrolled in.

Spending On Higher Education

The cost of higher education is escalating, the main expense causing concern for Indian parents. For example, if studying engineering today costs, on average, 10 lakh, it will cost, on average, 40 lakh to 50 lakh in around 15 years. In the same vein, it is reasonable to predict that a medical degree, which currently costs 25 lakh rupees, would exceed one crore in 15 years.

Even after tax exemptions, parents can choose to finance their children’s higher education with student loans, although the interest rates are still exorbitant.

Amounts Spent On Elite Colleges

The cost of elite higher education in India is very high. It costs about Rs 4–20 lakh to enroll in a top-tier engineering college, such as one of the 23 IITs or any other private university, for a 4-year BTech or a 3-year BSc. Coaching costs for admission examinations like JEE, JEE (Main), and other tests can cost anywhere between Rs 30,000 and Rs 5 lakh.

A prestigious management school, such as one of the 20 IIMs, or any other private university in the nation, costs between Rs 8 lakh and Rs 23 lakh. Coaching for prerequisite exams like the CAT or GMAT is more expensive.

A CPA costs Rs 3,60,000 in a profession like finance; a CMA would cost Rs 80,000–1,20,000, including training, exams, and IMA membership fees.

Developing A Strategy For Future Assistance

Early preparation can help you accomplish these objectives without making significant lifestyle sacrifices. Starting investing early can help you attain the desired amount for your child’s bright future, even if you start modest. The discipline to follow priorities and a plan is crucial when planning for objectives when it comes to parenting children.

You must be sure to account for all of your child’s ambitions and begin making regular investments to achieve them. This will guarantee that you can provide your child with the bright future you hope for them and give your family a financially secure future.

Generally, the first three years of a child’s life are when parents should anticipate paying 50% of the overall cost of the child’s healthcare. After that, every year, parents may anticipate a least 10% increase in the cost of child care. In addition, the costs of a child’s education within the next three years, such as school tuition or any extracurricular activity fees, are included in short-term goals. Therefore, it is better to allocate assets heavily to debt for short-term aims.

Establish An Emergency Fund

Before having children, a reserve of 3-6 months’ worth of costs is adequate. However, it is preferable to reserve 6 to 12 months to a year’s worth of spending in cash or assets close to cash, such as FDs, liquid funds, and ultra-short term funds.

Parents might also consider increasing the family’s health insurance coverage to at least Rs. 10 lakh and beyond by including the child. Long-term objectives would include paying for college and getting married. Parents might consider investing in a portfolio with 85% equity and 15% debt for long-term (greater than ten years) goals.


Although nothing compares to the delight of having a kid, raising a child and giving them a happy life requires a significant financial commitment. This emphasizes the necessity to prepare financially while keeping in mind your objectives as an individual and your goals as a family, to offer an approximate estimate based on research on the expenditures paid by a couple to raise a kid in today’s time.

Talking with your spouse about your ability to afford the expenditures of having and raising a kid is the most crucial factor to consider before starting a family. In addition, if either partner takes a leave during the pregnancy or after the delivery, you should know how your finances may be impacted.

How much does raising a child in India cost?

●        Raising a kid in India costs 30 lakh for school and one crore for college.

How much do parents in India invest in a child?

●        Families in Tier I cities spend, on average, Rs 43,000 per year on their child’s education, whereas Tier IV city families, on average, spend Rs 29,000 per year.

How much does childbirth cost in India?

●        Over the first three years, the total expense of raising a child in India might range from Rs. 5 lakh to Rs. 6.5 lakh.

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