How Much Does It Cost to Raise a Child in India?

If you are a parent, parents-to-be, or planning a family in the future –
one of the most important things to consider is how much it is going to
cost. You cannot put a price tag on having a child; it is a priceless
experience that adds immense joy and meaning to life.However, smart
parents are those who are prepared for the journey emotionally, physically,
and most importantly, financially. This essential guide breaks down the cost of every aspect of raising a child in India to make sure you have
everything covered.

The costs listed here are calculated based on the expenses of a
high-earning couple living in a metro city in India. In each stage, we give
a table with the detailed split of the expenses incurred during this
period.Note that the actual prices for your family may vary, based on your
lifestyle, location, and other preferences.We have calculated prices based on prevailing expense rates. It may vary
based on the current age of your child. For rates after inflation, check
the end of this report.

In the prenatal stage, special focus needs to be on the carrying mother.
Let’s examine a few key expenses:● Medical Expenses: The average monthly medical expense
for a expecting mother is Rs. 2000 which includes injections, drugs,
vaccinations. This is 2000 x 7 = Rs. 14,000 starting from the date of pregnancy confirmation up to the eighth month.● Doctor’s Visits: This includes approximately 2 doctor
visits every month, with each visit costing Rs. 1000 to a total of Rs. 15,750 .● Sonographies :A single Sonography costs around Rs. 2000
and it is recommended to take a fortnightly scan (total of 10 to 12 scans),
which can equal to Rs. 20,000 approximately for
the entire duration of the pregnancy.● Maternity Clothing: The pregnant mother would require (a
minimum of)12 to 18 pieces of maternity clothing. Assuming that a piece of
clothing costs roughly Rs. 1000, this equals to Rs. 18,000 . ● Grocery :There will be an increase in the monthly
grocery expenses to meet the nutritional needs - fresh fruits, ghee,
protein, and vegetables for the pregnant woman. This increase is estimated
to be around Rs 3587 per month or 32.283 during
the pregnancy period.● Pre-birth Rituals: Rituals such as baby showers (godh bharai) can cost
anywhere from Rs. 20,000 to 1 lakh depending on
the number of guests and the scale of the celebration. Optional Expenses There are some optional expenses too, which are not taken in this
calculation.

Let’s examine a few key expenses during the child delivery

In this stage, the hospitalisation cost is the major expense. This could
largely depend on the type of option chosen by the parents as well as the
doctor. The two options of delivery are either normal/vaginal or C-section
delivery.While C-section delivery could cost anywhere between Rs 60,000 to
1.5 Lacs, a normal delivery could cost about 40,000 to 1 Lac depending on
the type of hospital chosen or the city you live in.There is another optional expense which is highly recommended in this
stage. This is not taken into calculation.

The first few years of a child’s life requires extensive medical care, as
newborns are prone to infections.

Let’s look at a few key expenses in this stage.

● Paediatrician Fees -The average cost of a paediatrician
and physical visit (for the mother) is estimated at Rs.475 each, or Rs 950,
which is a recurring expense, once every three months, till the baby
reaches the age of 2. Thus, you will need to budget for at least 4 such
visits during the period, bringing the total estimate to Rs 3800 .● Vaccination Costs -The cost of vaccination per month
for infants is Rs. 1231, growth supplements can cost an additional Rs. 1105
per month and routine cold and flu doctor visits can average about Rs. 764
every month, bringing the monthly medical expenses for the infant at Rs.
3000 pm, which equals 3000 x 24 = Rs. 72,000 .● Cost of Diapers -Assuming you use 5 diapers for the
newborn per day, the monthly cost of diapers is 1100, which equals 1100 x
24 = Rs. 26,400. ● Nanny and Massage Person -The prevailing rates for the
maalishwaali (massage person) is Rs. 8000 pm for 8 months = Rs. 64,000 . The monthly rates of a qualified nanny
could range anywhere upwards starting from Rs. 10,000 per month, which
brings the total estimate of nanny to Rs 2,40,000. ● Birthday Party -Starting from this stage, the birthday
party expenses are calculated at Rs. 10,000 per year for the child or 20,000 for 2 years. Note that this is for a
simple house party. If you opt for grander celebrations at a party hall,
then the costs can be anywhere from a few tens of thousands of rupees to a
few lakhs.

Let’s examine a few key expenses while raising a toddler

● Pre-school fees - It can range from Rs. 50,000 upwards depending on your city, chosen
pre-school brand, conveyance, after-school care, etc.● Vaccination and Medicine for routine Illnesses :As the
immunity of the child is building, you will need to be prepared for routine
cough and cold visits to the doctor and also include periodical
vaccinations. This is estimated to be around Rs 2000 per month or Rs 24,000 in a year.● Apparel and Toys: As your child continues to grow, you
will need to budget for clothes and toys for your child. This can be around
Rs 60,000 during the period (40,000 + 20,000)● Special Nutrition Food: Growing children require special
nutritional drinks like Pediasure, Horlicks, etc. which can cost around Rs.
1000 per month or Rs 12,000 for the entire year.● Nanny/day Care: Just as in the infant stage, this continues to be a significant factor here, as well and
this is estimated at Rs. 13,000 per month or Rs 1,56,000 for the entire year.● Birthday Celebrations :The cost of celebrating your
child’s birthday party is calculated at Rs. 10,000 and the gifts your child
purchases for other kids is estimated at around Rs. 5000 in a year
totalling to Rs. 15,000 during this period .

● Education -The average of school fees calculated based
on top schools in Tier 1 cities like in Gurgaon, Indore and Malad is around
Rs. 3,48,775 .● Uniforms and Textbooks -Calculated based on standard
rates is 10,399 per year, which is 10,399 x 5 = 51,995 .● Extracurricular activities -Starting around the age of
7, extracurricular activities cost around Rs. 3000 per month, which equals
3000 x 24 (for ages 7 and 8) = 72,000 .● Medical Expenses -Growth supplements cost around Rs.
1000 per month, vaccination and cough and cold medicines cost another 1000
every month, bringing the medical expenses to 2000 x 60 = Rs. 1,20,000 .● Food, Clothes and Toys -Clothes cost 30,000 per year
(30,000 x 5 = 1,50,000 ); Toys range around 1000
per month (1000 x 60 = 60,000), nutritional needs of the growing childlike
Horlicks and other health drinks come around 1000 per month (1000 x 60 = 60,000 ).● Vacations -The average cost of a 10-day annual domestic
family vacation is estimated to be around 45,000 x 5 years = 2,25,000 .

Let’s examine a few key expenses for a child during middle school

As the child has grown up, nanny and daycare expenses aren’t taken into
account. Still, other costs like – pocket money, gadgets for your child,
recreation will become part of the family budget.● Education -The average of school fees calculated based on top schools in
Gurgaon, Indore and Malad is around Rs. 3,39,025. ● Extra curricular activities -Extracurricular activities
cost around Rs. 3000 per month, which equals 36,000 per year x 5 years =
Rs. 1,80,000. ● Clothes/Toys/Games/Books -Clothes cost 35,000 per year
(35,000 x 5 = 1,75,000 ); Games/books/toys range
around 25,000 per year (25,000 x 5 = 1,25,000);● Vacations -The average cost of a 10-day annual domestic
family vacation is 45,000 per vacation per year x 5 years = 2,25,000.

Let’s examine a few key expenses during college

Apart from school fees, you also have to pay for coaching classes,
competitive exams, educational consultancies, etc. These are the tumultuous
teen years. You can expect your child to be influenced by peer pressure –
demanding designer clothes, expensive gadgets, outings with friends, and
more.● Education -The average of school fees calculated based
on top schools in Gurgaon, Indore and Malad is around Rs. 2,77,898. ● Uniforms and Textbooks -Calculated based on standard
rates is 16,400 per year, which is 16,400 x 5 = Rs. 82,000.● Extra curricular activities and Special Classes -Extracurricular activities cost around Rs. 3000 per month, which equals 2,16,000 for 6 years. Special coaching for Class
X at Rs. 300 per hour for 7 subjects twice a week costs 16,800 per month,
which equals Rs. 1,68,000 for one year. Total cost = 2,16,000+1,68,000 =
3,84,000.● Gadgets -Average cost of a laptop and an entry-level
mobile phone is estimated to be around Rs. 30,000

The expenses at this stage depend on your child's interests. It is not
possible to predict your child's passions – 5, 10, or 15 years down the
line.We have calculated the expenses at this stage for two streams:

or

Let’s examine a few key expenses in this stage. ● College Fees -For commerce, this is estimated to be
around Rs 6000 per year, which is Rs.6000 x 3 = Rs.18,000. For MBBS, the
fees is around 42,00,000 for the first three years of the course.● Special Coaching and Extracurriculars for Commerce Stream - This includes GRE/GMAT coaching which includes registration fees
(15,000), coaching (30,000), and books (5000) bring the total cost to
Rs.50,000. The extracurriculars cost Rs. 3000 per month (3000 x 12 =
36,000); Total = 86,000.

We have calculated the costs for two streams: MBA at a premier institute in
India and MBBS. Note that if your child dreams of overseas higher
education, it could cost you anywhere from around 40 lakhs to more,
depending on the country and the course chosen.

Don’t forget to Factor Inflation! When planning for a child, parents-to-be often forget to factor in the cost
of inflation. This can upset the planning quite a bit. To give an example,
the current higher education costs for an MBA at a premier institute in
India stands at Rs. 2,892,000. Let's say, you have a newborn in your
family. Factoring in inflation at a rate of 5%, by the time your child
reaches 21 years, the cost of the MBA degree would have shot up to Rs.
9,326,989, nearly 3.5x times the current fees.Here’s a quick chart illustrating the costs of the child at various stages
factoring inflation:

Start by calculating the financial needs of your child using the tables given above. Once you have an idea of how much it costs start saving and investing for your
child's future. With the right financial planning, you can enjoy the joys of parenting
without continually being overshadowed by financial worries.

• A child definitely brings immense joy, but along with it is an additional financial responsibility for which you need to pre-plan accordingly.
• Right from the time a baby is born to a phase of adulthood, the cost of raising a child only increases. Therefore, you need to make sure that you have everything covered.
• In short, you have to take into account every cost to be incurred at all life stages of your child. This includes prenatal care, delivery charges, infant, toddler, school expenses, college fees, and post-graduation expenses. These can be categorized into standard needs.
• Apart from these, you may have to fulfill demands like an expensive gadget, clothes, trips with friends, etc. While doing cost analysis, parents should factor in the cost of inflation so that their efforts do not go haywire.

The information contained herein is generic in nature and is meant for educational purposes only. Nothing here is to be construed as an investment or financial or taxation advice nor to be considered as an invitation or solicitation or advertisement for any financial product. Readers are advised to exercise discretion and should seek independent professional advice prior to making any investment decision in relation to any financial product. Aditya Birla Capital Group is not liable for any decision arising out of the use of this information.