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A New Baby Could be a Good Time for Financial Fresh-Start

November 4th, 2013 at 11:01 am

texas-bankruptcy-fresh-startThere are usually all kinds of planning and important decisions to be made when a couple has a new baby on the way.  And many of those plans are expensive ones.  According to the U.S. Department of Agriculture (USDA), it costs a middle-income family almost a quarter of a million dollars to raise that child from infancy to age 18 – and that’s excluding college tuition.

The UDSA’s new report breaks down as follows:

  • Families earning between $60,640 and $105,000 (pretax) will spend $241,080.
  • Families earning less than $60,640 will spend $173,490.
  • Families earning more than $105,000 will spend $399,780.

The report cites the two largest expenses as housing (33 percent) and child care/education (23 percent).  The third-highest expense is food (18 percent). Although parents may be tempted to overspend in other areas, none of these three categories are arbitrary ones.

For parents already struggling with significant debt, the increase costs may be overwhelming. For example, before baby, both parents are working full-time yet still unable to keep up with debt obligations every month. After the baby is born, a good portion of that net income is drastically reduced and paid for daycare tuition.

According to a study done by the Center for American Progress, in 2010, among families with children 44.8 percent were headed by two working parents and another 26.1 percent were headed by a single working parent. A good quality, licensed daycare can cost more per year than college tuition.

This may just be the time to consider whether or not filing for bankruptcy protection may be the best option in being able to handle all the new and unforeseen expenses that arrive along with the new baby. Contact an experienced San Antonio, Texas bankruptcy lawyer today to find out what your options are and why this may be the best financial decision for you and your new family.

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