Stunned to Realize I Need 20 Million Yen Over the Next 7 Years: The Reality of Child-Rearing Costs

I apologize for starting with such a large amount. I also apologize for the clickbait-style title. But it is the truth. It seems that starting next year, our household is about to enter an era of massive spending.

What I mean is the cost of raising children.

So, this is not a cheerful topic.
It is a story about the real money it takes to raise a child.

When I suddenly calculated it, I was stunned to realize how much it really costs.
Honestly, I knew from before that raising children costs a lot. I'm sure you've all heard that too.

It is said that the cost of raising one child is 20 to 30 million yen.
Since we have two children, that's 40 to 60 million yen.

At first, it doesn't feel like it costs that much, but it all adds up at once during university or vocational school.

This is an individual example, but it might be helpful regarding how money is spent on child-rearing, so if you are interested, I would be happy if you stayed with me until the end.

It costs 10 million yen per child from age 0 to 18

It is said that child-rearing costs 20 to 30 million yen, but it is relatively gradual while the children are small.At first, it starts with diaper and formula costs, and then money is spent on medical and childcare expenses.

At the time, I spent money thinking, 'I guess I need money now,' but I managed somehow. There were many expenses that were part of daily life, and since there were public subsidies, I didn't feel that the household budget was under such great pressure.

Perhaps I am forgetting the time when the children were small (the reality of the massive expenses I am facing now is just too real...)

The period when child-rearing costs the most is university/vocational school (10 million yen)

It costs the most when they go to university or vocational school. If it is a public school or university, it can be relatively cheap. However, that is not the case with private universities. It costs 10 million yen over 4 years.

Vocational school is 2 years, so I thought it would be 5 million yen, but it looks like it will cost a little more. Depending on the skills acquired and the region where they live, it can be a bit more expensive, costing 6 or 7 million yen.

The conditions for free university tuition are very strict

I often hear about free high school tuition, but there is also a free tuition system for universities. Both are determined based on household income.

For high school, the screening requirements are based only on household income, so it is said that about 80% of families benefit from free tuition.
However, in the case of universities and vocational schools, the screening requirements are household income + motivation for further education + assets.

It is a system that can be used by families who are truly struggling.

It seems to be a system where hidden wealthy people who intentionally keep their annual income low but have a lot of assets cannot receive it, and families who are truly in trouble can receive it.
However, it is a difficult system to use because it does not provide a full subsidy for tuition.

The next most expensive things are private middle and high schools

The high school tuition waiver program is a huge help. As I mentioned earlier, about 80% of households are eligible. For public schools, tuition is about 10,000 yen per month, which is covered by this subsidy.

However, for private schools, tuition costs about 400,000 yen per year. Even if 100,000 yen is covered by a subsidy, the impact on the household budget is immediate and significant.

However, an increasing number of prefectures are offering their own subsidies for private school tuition.The income requirements are stricter than those of the national program, but it makes a world of difference whether you have it or not.

I calculated it and it looks like it will cost 20 million yen over 7 years | Can I handle this?

I did the math, and this is what I found. I think these are quite realistic numbers. When you add it all up, it really does look like it will cost about 20 million yen.

Older child: 2 years of vocational school, tuition 3 million yen (surveyed from target school)
　　　　　　　　　　　Living expenses 3 million yen (surveyed from target school)
Younger child: 3 years of private high school, tuition 1.85 million yen (surveyed from target school)
　　　　　　　　　　　Living expenses 1.7 million yen (calculated back from average values)
　　　　4 years of private university, tuition 5 million yen (from average values)
　　　　　　　　　　　Living expenses 5 million yen (from average values)
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Super rough calculation result 　　19.95 million yen ≒ 20 million yen

I think I'm pretty much on the mark myself.

Even if you know it, when children are small it feels like a distant future, but once they enter middle school, you worry and fear it in reality

When children are small, especially in elementary school, even if you know it will cost money in the future, it feels like a distant future. However, once my child started middle school, I began to feel something heavy somewhere in my heart.

When they entered high school, that feeling grew, and now I finally understand. It is the educational expenses for university and vocational school.

To use a scholarship, or not to use one...

Some say that if the household budget is tight, there are scholarships. However, if I can manage it, I would like to pay for their education with savings rather than using a scholarship.

Some argue that this is spoiling them, and if you take one wrong step, it makes the child think of their parents as an ATM, but my honest feeling is that I don't want them to start their adult life in debt if I can help it.

There are various types of scholarships, such as interest-bearing, interest-free, and non-repayable, but the interest-bearing type in particular is easy to receive but is essentially the same as a loan.

For example, if you receive 5 million yen in scholarships over 4 years, you could pay for tuition.
However, to pay this back, if the annual interest rate is 3%, it is said that it will take 20 years to pay back 35,000 yen per month. That calculates to a total of 8.4 million yen, which is like paying for an extra car.

It's quite a burden, and it's tough to have scholarship payments continue until you're 42.

Summary: University, in particular, costs a lot all at once | Savings are important

Raising children costs money. Especially for entering private high school and university, the burden is 2 to 3 times greater than before than what you are used to.

When children are small, it looks like it costs money (and it certainly does), but it's not as significant as when they enter university. It has such an impact that I have deeply realized the importance of preparing for it on a regular basis.

#3-line diary: Even so, I am looking forward to my child's further education

Younger generations might see how much it costs and think, 'Why bother starting a family if it's that expensive?' However, watching children grow is a joy.It certainly costs money, but it also makes me feel alive. I have a sensation now that is clearly different from how I felt when I was young. Maybe I've gone a bit strange. Haha.

Thank you for reading until the end!