Raising a child in today’s economy is forcing a generation of young parents to make painful financial trade-offs, sacrificing long-term retirement security to cover short-term costs.
A new survey from Wealthsimple reveals that half of Canadian couples with children say they’ve made financial compromises to start a family. 39 percent report struggling to plan ahead due to rising costs. The picture is even more dire for single parents-58 percent say they’ve made financial trade-offs.
The survey shows retirement plans are taking a direct hit. 57 percent of couples with children have reduced or paused investing. 52 percent have reduced or paused saving. And 35 percent have cut back on retirement contributions.
Single parents are even more strained: 62 percent have paused saving entirely, and 40 percent have taken on more debt to cope.
Household tensions are also soaring. 87 percent of couples with children say finances have caused conflict, with daily expenses being the top trigger. Nearly one in five couples with kids admit money has been hidden from a partner-nearly double the rate of childless couples.
The financial weight is staggering. An RBC analysis pegs the average cost of raising a child from birth to age 17 at roughly $300,000. Families spend about $17,000 annually per child, with child care alone costing up to $6,500 a year. Costs peak between ages 6 and 12, ranging from $13,200 to $22,500 annually.