The New ♐York City Economy Tracker is a joint project between Inℱvestopedia and , using publicly available data to evaluate the economic health of the city across a variety of metrics.

For the week of May 6, 2024, we’re looking at the cost of childcare in New York City and how it ꦜis one of the biggest🧜 expenses for New Yorkers.

Childcare Is a Massive Cost Burd🍰en for New Yorkers

Living in NYC comes with a lot of uniquely high living expenses, but one of the biggest is the cost of taking care of children. Overall, the costs of raising two Pre-K kids in the NYC metro area can run an estimated $55,647 per year. This is about 60% of the annual median household income. Taken together the expenses needed for having kids✤ can be one of the largest l🧸ine-items in a family’s budget in NYC.

Living in NYC comes with a lot of unique♋ly high living expenses, but one of the biggest is the co♋st of taking care of children. Overall, the costs of raising two Pre-K kids in the NYC metro area can run an estimated $55,647 per year. This is about 60% of the annual median household income. Taken together the expenses needed for having kids can be one of the largest line-items in a family’s budget in NYC. 

Although there are a variety of expenses kids can incur for their parents or guardians, the most expensive one by far is the cost of child care. Especially for the Pre-K ages, full-time, center-based child care costs can cost around $20,000 per year for each child in New York State, according to data from the ChildCare Aware. Childcare costs 🌟alone end up being about 72% of the🐟 total extra cost of raising Pre-K children in the New York City metro area. 

Although childcare costs decline substantially once children enter elementary school, there are still expenses associated with taking care of them outside of the school day and school year. The NYC Parks Summer Day Camp program for children ages 6 to 13 for seven weeks this summer costs between $500 to $575 per child. The average two-week traditional summer day camp at YMCAs across the five boroughs average out to $782 per child.

Outside of childcare, other major expenses that increase for New Yorkers with kids are food, transportation, and rent. According to data from the MIT Living Wage Calculator, a two-earner household with two children will have to spend an extra $5,391 on food, $4,120 on transportation, and $3,983 on rent per year compared to the same household without kids. Although not as ex꧅pensive as childcare, these costs are more steady throughout a child’s life aꦉnd can even increase with age.

Data from the BLS Consumer Expenditure Survey show that the average household in the NYC metro area will spend about $214 on children’s clothing alone in a given year, when adjusting prices for the NYC area. Additionally, prices for group health insurance premiums can cost approximately $1,909 per year higher than individual plans, according to the K꧙aiser Family Foundation.

Overa🎐ll Cost of Raising a Child in NYC Actually Lower Than Bos🅰ton and DC

Surprisingly, New York isn’t the most expensive place to raise a child on the East Coast. The cost of two Pre-K kids in the NYC metro area is about 7.6% less expensive than the 🍃Washington DC metro area and a full 10% lower than the Boston metro area. However, NYC is still almost 40% more expensive than the Philadelphia metro area.

Two of th💮e main drivers for the differ🌺ence between NYC and Boston and DC are the differences between the cost of childcare and health insurance premiums. In Massachusetts the annual cost of two Pre-K kids in full-time center-based care is an estimated $43,228 and in Washington DC it’s $43,214. These are about 8% higher than the approximate cost in New York of $40,031. Additionally, the difference between family and individual health insurance premiums in Massachusetts is about $2,263 and in Washington, DC is about $3,276, substantially higher than New York’s $1,909.