What are the financial benefits of not having children?

June 7th, 2013 Scott Jamison

Do you live in a “dual income, no kids” – or DINK – household?

The decision to have children is a very personal one. Some people deeply want to be parents, while others prefer not to. Some may be enjoying the DINK lifestyle before jumping into parenthood.

Regardless of the reason, there are many financial advantages of not having kids.

Debt elimination

With two incomes and no kids, the ability to pay off debts should be relatively easy. Since you don’t have to allocate money towards childcare and other costs that come with raising a child, you should be able to allot a portion of your income towards reducing your debts in a timely manner. Be sure to take this opportunity and use it to prevent debt in the future when life might potentially become more expensive.

Saving for the future

Thanks to the beauty of compound interest, DINKS have a significant advantage when it comes to long term savings. Why? Because you can reap the benefits of saving more today and watching it grow in the future. This makes retirement planning a lot easier as well.


While there are many ways to save money when you have children, it inevitably costs more to have children than not to have children. According to U.S. Department of Agriculture statistics released late 2012, parents will spend an average of $235,000 to raise a child born in 2011 to the age of 17. That’s not taking into account any savings for college. Eliminating this expense gives you the ability to save and invest more.

However, in addition to the emotional and personal joys that kids can bring, there are also some financial advantages to having children.

Tax credits & deductions

The Child Tax Credit is worth up to $1,000 per child under 17 years of age, and is gradually reduced based on level of income. In addition to the standard tax deduction you receive for having a child, you might also qualify for the Earned Income Credit (EIC) or the Child Tax Credit, or both, depending on your financial situation.

If you pay for child care, you may also qualify for a federal tax credit of up to 35 percent of the cost.

Finally, if your child is in college and you are paying tuition and can claim him or her as a dependent, you can also claim one of several education deductions and credits on your tax return.


Studies have shown that fathers make 4 percent more over their lifetime than non-fathers. Many people refer to this as the fatherhood premium. Unfortunately this does not hold true for women. Mothers earn less over a lifetime than either men overall or women without children.

Scott Jamison

About the author

Scott Jamison is Retail Managing Officer at MidWestOne Bank. He helps customers manage their personal finances and identify effective money management solutions.

Comments are closed.