New Survey Uncovers Misperceptions of Child Care Costs by State

BOSTON, July 11, 2024 /PRNewswire/ — A new study by is shining a light on the financial realities of child care in the United States, revealing significant gaps in Americans’ perceived expenses of a baby’s first year and the actual costs.

“It may be impossible to estimate exactly how much you will be spending on your child’s first year of life, but it is definitely worth trying to get as close as you can,” said Erica Sandberg, Finance Expert. “It’s best to overestimate the costs so you have money left over rather than underestimate them and then fall short.” 


To determine where the biggest misperceptions lie, the study analyzed five key expenses associated with a baby’s first year — day care, diapers, formula, food, and new clothing. Those expenses were then compared to survey responses from more than 2,000 Americans, asking them to estimate the annual cost of the five child care expenses mentioned above.

Perceived vs. Actual Day Care Costs, State by State

The study found that residents in over half of the states (56%) underestimated their average annual day care cost. The national average is $13,266. Survey respondents, however, estimated it to be $12,055, a 10% shortfall.

The 5 States Where Residents Most Underestimated Annual Day Care Costs:

  1. Massachusetts
  2. New York
  3. District of Columbia
  4. Hawaii
  5. Colorado

The 5 States Where Residents Most Overestimated Annual Day Care Costs:

  1. Oklahoma
  2. West Virginia
  3. Georgia
  4. Louisiana
  5. Pennsylvania

The Price Tag of a Baby’s First Year: Perception vs. Reality

Astonishingly, all states underestimated the financial costs of having a baby by 37%. Survey respondents estimated the cost at $15,177, while the actual figure is $22,111. Respondents from New Hampshire and Massachusetts were the closest, missing the mark by $2,099 and $2,769, respectively. In contrast, respondents from Mississippi and Alabama underestimated the cost by over $12,000.

For more information about the study and its findings, visit

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