‘Every parent will want the best’: The rising costs of raising children in Singapore

SINGAPORE: Ms Vanessa Lim had initially set aside about S$600,000 (US$470,000) for her son’s future – a figure she thought would be sufficient for her dual middle-income household.

But after his birth, new considerations like infant care, future enrichment classes and tertiary education came into the picture.

Today, about two-and-a-half years later, that budget has climbed to nearly S$1 million.

“Every parent will want the best for their child regardless of their income. They will do whatever they can within their means to provide them with the best education, the best enrichment, the best environment, the best network,” said Ms Lim, who also has a domestic helper to help take care of her son.

“It's so competitive now. And I think even in my time when I was a student, we (went) for a lot of enrichment, a lot of classes,” the 29-year-old, who works in finance, told CNA.

Ms Lim’s experience reflects a growing reality for many parents in Singapore, where the cost of raising children has risen sharply in recent years.

RISING COSTS SHAPING ATTITUDES

While daily necessities like food and subsidised school-care remain relatively stable, additional costs like enrichment and tuition classes take up the bulk of projected spending – some of which have grown by at least 50 per cent compared to three years ago.

This discretionary spending comes as parents like Ms Lim seek to give their children a competitive edge.

Financial consultants said they are seeing projected child-rearing costs reach between S$250,000 and S$500,000 – and in some cases, significantly higher.

“The middle income will feel most of the brunt, because they don't qualify for the maximum subsidy (or get) sufficient resources from their career to compete effectively for top-quality schools, tuition enrichment classes, etc.,” said financial consultant James Yang.

These rising costs are also shaping attitudes towards parenthood in Singapore.

Mr Yang noted that more than half of his clients do not want children, a proportion that has been increasing amid rising expenses like housing and the cost of living, alongside greater economic uncertainty.

Singapore’s total fertility rate dropped significantly to a new low of 0.87 last year, after falling below 1.0 for the first time in 2023.

For Mr Marcus Arriola and his wife, concerns about job stability and financial risk have played a major role in their decision to remain childless.

When he worked in advertising in 2024, he was among almost 30 employees who were retrenched, leaving him without a stable income. He has since found a new job in the same field.

“Right now, in my current experience with work, things are changing overnight with technology advancing, AI and all that, and anything can happen next week … Everybody's job may be redundant. There's that fear, that constant worry,” the 36-year-old said.

“It's not as easy as if it's just my wife or myself, right? It's a risk that we don't want to put on the child.”

While he said he is open to reconsidering his stance on having children someday, he has not “received a proper reason” to do so.

Existing government incentives have not been enough to change his mind either, as they cover only a small portion of the overall cost.

HOW MUCH IT COSTS TO RAISE A CHILD

Estimates show that expenses begin even before a child is born:

• S$800 to S$3,500 for prenatal care - including gynaecologist visits, supplements and prenatal classes.

• S$1,200 to S$20,000 for delivery costs - depending on the hospital, ward class and birth type.

In the early years, spending rises significantly:

• S$44,000 to S$95,000 for postnatal care and infant essentials - such as diapers, milk powder and cribs, as well as childcare - in the first four years alone.

• No primary school fees for Singaporean children in government schools.

• S$14 to S$830 monthly for secondary school fees for Singaporean children, depending on what type of school they are enrolled in. 

• Expenses for school essentials like books, uniforms, transport and daily allowances.

• S$750 to S$900 monthly on average for enrichment and tuition classes – or roughly S$126,000 to S$151,000 by the time a child turns 18.

Recurring expenses are something people easily overlook, said father-of-three John Dasson, a wealth advisory director at Financial Alliance.

“Childcare is the perfect example. (It spans) possibly four years and it could cost a very large amount,” he told CNA’s Singapore Tonight.

“And even S$1,000 or S$500 or S$300 saved, it compounds over four years – and it’s not just what you save. It’s the loss of the opportunity to invest, to grow for savings in the future.”

Government support schemes help offset some expenses, including MediSave claims of up to S$4,680 for natural deliveries and S$6,340 for caesarean births, as well as up to S$20,000 in Baby Bonus-related benefits for a first child.

But these sums cover only a fraction of total expenditure.

WHAT COULD HELP

Mr Yang, the financial consultant, said a review of government grants and more targeted incentives for parents could help.

These include additional tax reliefs for higher-income earners having more children, housing priorities for families with kids, more flexible parental leave, and more family-oriented workplaces.

“In my personal opinion, the high-income earners are in a better place. They are better equipped to raise children amidst the high-cost environment. So if we can encourage them, I think they are in the best position to have more kids,” he added.

As for how new parents can deal with looming expenses, Mr Dasson said they should think about it in steps, with the first one being big expenses like childcare, medical bills and premiums.

“If you manage that from a monthly affordability viewpoint, you tend to be able to still possibly carve something out at the end of the day, right? The end aim is to get just a positive cash flow,” he noted.

During the later years, especially when children enter university, parents will need to consider their savings, he added.

“You want to manage those two phases slightly differently in the beginning and show that cash flow is managed, and you've got something to put aside that can compound over 15, 20, years and help you with that eventual savings that you need,” Mr Dasson said.

SPENDING QUALITY TIME

However, for Mr Derrick Koh, board director of the Centre for Fathering, money is not the be-all-end-all.

He pointed to an analysis conducted by the non-profit organisation of about 65 studies involving 150,000 children, which showed that fathers’ active involvement in their children’s lives leads to better emotional and social wellbeing outcomes.

Mr Koh himself had left a 25-year corporate career three years ago to be a full-time father.

“Because of that, your income has shrunk but the bills have not … Every spending has to be a bit more deliberate, so between my wife and I, we will be counting the cost,” he added.

“But (it) made us realise one thing - it's not really about spending more on the kid, it's really about the time that you spend with the kid.”

Mr Dasson also cautioned against being over-eager to enrol children in enrichment and sports lessons, just because other parents are doing so.

“It's very easy to get caught up in this lifestyle inflation,” he said.

“I think the key is to really focus on what you and your family need, what's right for you, and really look at the affordability of things and make those decisions.”

Mr Yang added that having a mindset shift is also crucial. 

"Sometimes, just letting your child be who they are … is far more important than trying to put them into an intense, stressful environment of just competing for the sake of competition.”