The Cost of Raising My Colt

April 30, 2013

As a little girl, I dreamed of owning my own horse. My favorite book was Misty of Chincoteague and I even subscribed to Horse of Course magazine. I would beg my parents to get me a colt or pony but since they knew the ongoing expense, I would never get my wish.  According to petplace.com, it can cost about $10,000 a year to keep a horse, including boarding, vet bills, feed, etc.  The average lifespan of a horse is around 25 years so you can do the math and see that it would be VERY expensive.

Last week, I finally did get my wish in a way. He has a mane of black silky hair but no, he’s not actually a horse. He is my lovely grandson, who was born last week and is named Colt.  I hope he has a lifespan MUCH longer than the horse I yearned for in my childhood though (and also a much longer average sleep cycle since horses typically only sleep about 2.9 hours a day).

So what’s the cost of raising Colt?  A government report last year from the Agriculture Department’s Center for Nutrition Policy and Promotion found that middle-income parents will spend about $235,000 in child-related expenses from birth through age 17.  This includes housing, transportation, child care, education, food, clothing, health care and miscellaneous expenses. Yet it doesn’t even include college costs, which would add even more.

Here are some tips to help buffer some of these costs:

  • New parents should consider dedicating additional funds to saving for out-of-pocket medical costs if they aren’t already maxing out their medical FSA (flexible spending account) or HSA (health savings account). For 2013, the contribution limit to an FSA is $2,500 while an HSA has a higher limit of $6,450 for families.
  • If the child will need day care, the Dependent Care FSA can be funded with up to $5,000 pre-tax, which can provide the ability to set aside the day care costs through payroll deduction. Just make sure the day care provider is willing to provide their tax ID number.
  • Think “location, location, location” for your housing. Having a home close to loved ones can mean built-in babysitters! Colt is lucky that he is within an hour of both sets of grandparents, who will be happy to spend many a weekend spoiling him. Living in a good school district can also save thousands of dollars if you don’t have to resort to looking at a private school.
  • Kids grow out of clothes fast so check out consignment shops for “new to you” clothing or host a clothing exchange with other parents in your community.
  • It is never to early to think about those college costs so take a look at your state’s 529 College Savings Plan. Many states offer an added incentive on top of the federal tax-free growth. Better yet, get the grandparents involved.  As a Pennsylvania resident, my husband and I can start to take a state tax deduction for money we contribute to a 529 Plan for Colt, which for 2013 is up to $28,000 MFJ.

A horse is expensive but my Colt is priceless!