Why More Americans Are Going Child Free

We married quite young and we both decided, for many reasons, that we did not want to have

child

ren. And then at some point we heard the acronym DINK and I think we really fell in love with it. More Americans are choosing not to have

child

ren, and it has a purpose. This new trend has led to the emergence of a new type of home,

more

commonly known as DINK. Double income, no children. Oh yeah. Double income, no children. That's perfect for us. That is absolutely correct. Children are the death of net worth. Pretty crude, but honestly. Very sure.

This family configuration of two-income couples living alone without children is increasing. In 2022, it will be around 43% of households. And that's about a 7% increase from the previous decade. In 2022, 43% of Americans surveyed said they would want to get married, but only a little

more

than a quarter said they were sure they wanted to have children. The term DINK is becoming more and more popular due to financial challenges, and they see children as one more financial challenge that they may not want to take on. So what's it like to live on two incomes and no kids? And will that be the future of American homes?

According to a 2023 survey of DINKs, finances played a large role in their decision not to have children. More than a quarter of respondents said they simply cannot financially support a child right now. When we advise our clients about having children, we honestly don't even give them all the real details or the real numbers. It's one of those things that, if you really look at the math, could make you decide not to have children. It costs a family approximately $310,605 to raise a child born in 2015 to age 18. Adjusted for higher future inflation. And that doesn't even include the cost of college.

So if you look at inflation, within the child care market it exceeds general inflation within the economy. Some couples are contemplating having children while still paying off student loans they took out when they were 18 to 22 years old. One of my closest friends has been struggling with the reality that the take-home pay she makes is almost equal to what childcare would be like. It's a really difficult position. Watching our friends really struggle with that balancing act, I think, has made me appreciate the flexibility we have financially because we don't have kids. In addition to saving on childcare, DINKs can also take full advantage of the benefits of combining their finances.

Look at both of our incomes and see how we can handle all of that. Since we don't have extra money with a child, it is much more comfortable. We can focus more on the things we want to do, save a lot of that money for the future, and worry less about the daily finances of the house and our bills. Money isn't the only expense DINKs can save on. Free time is actually one of the most important things for me. So we built me ​​a little office-like bedroom here. We definitely have more expensive hobbies. I, uh, build mechanical keyboards, like, uh, computer keyboards in my spare time and just the parts and stuff for that can be very expensive.

Not having children has given us the

free

dom to dedicate ourselves to other things. Remodeling of our house. I am a beekeeper. I am very handy and I like to do things around the house. I wouldn't have time to do that after work if I felt like it, if I had, you know, a kid to take care of. Less spending leaves DINKs with more disposable income to play with. Disposable income is power, it is stability. And for many couples, it's security. The security that comes with having, you know, six months of income saved for emergencies, that security came in very handy for us during Covid when I was out of work for six months.

I have a smaller style of tractor. Next year we are

going

to get one. We have more tolerance for chaos, I think because of our savings, our new savings goal, which is like shooting for the stars and reaching for the moon, is to save four thousand dollars a month. According to census data, DINKs can save 9% more for retirement each year compared to dual-income couples with children. Another 2021 study found that childless adults ages 55 and older had a median personal net worth of $153,900, compared to $130,400 for biological parents. If you have a dollar and you have to choose how to use it, a DINK can prioritize savings, retirement, investments in both the stock market and real estate or second properties.

The hardest part about investing is simply having the cash to do it. So when you don't have your cash

going

toward child-related expenses, that cash can go toward those investment goals. We started investing when we were in our early 20s. I feel really secure because we have this strong savings of ETFs that are affordable and quite liquid, and then we also have our long-term savings, which, you know, are tied up in IRAs. We can choose what our aging years will be like because we have saved to plan for that eventuality. It is well documented that the younger you are when you start building savings and your retirement portfolio, the better off you will be in the long run in terms of aggregate savings and your ability to accumulate savings and wealth.

Just take the $310,605 a middle-income married family would need to raise a child. While children's expenses can vary significantly by age and location, that could easily represent more than $15,000 in otherwise investable funds per year. Let's consider the power of compounded annual interest and that $15,000 a year can grow to over $500,000 in just 18 years, assuming a 7% annual return. These savings could also help DINKs secure more assets. Two-income adults living together who have jobs and have been saving can actually make a relatively large, higher down payment on a home, which then lowers their monthly mortgage and has all these other benefits.

You are paying less interest in the long term. I was lucky that my grandparents gave me some good savings, and that helped us buy our first house, but then from there, living in that house, living in a place with a lower cost of living like Utah, Having dual incomes helped us build all of these savings, so when we sold that house and moved to Massachusetts, we had even bigger savings that allowed us to buy a more expensive home in an area with a higher cost of living. I'm not entirely sure where we would be if we also had a child.

This goes beyond simply purchasing a home. There are many important and expensive investments that we tend to make earlier in adulthood, to the extent that we can pay as much as possible up front. That has a knock-on benefit for us as we age. But the rise of DINKs is not great news for the economy as a whole. Lower birth rates have historically been associated with slower economic growth, and critical social programs like Social Security rely heavily on population growth. We should not strive to have a generation of young adults who are not reproducing. That would not be healthy for society.

It would not be healthy for the economy. It wouldn't be healthy for us as we get older. So there are many reasons why we want to get serious about investing in the next generation. For DINKs, the biggest challenges are often not financial. And I think we scared a lot of people when we were just a young couple, and that was it. Afterwards there was no baby. Some family members asked me if something was wrong because a young, healthy couple had not had a child for five years. I think there is a self-care aspect that is minimized when you are a DINK.

So there are a lot of mom groups or, you know, daddy-daughter dances. There are no groups because, hey, I'm a professional woman and I just want to go home, read a book, and take care of myself tonight. I think, on the other hand, there may be times when, in certain circumstances and circles, it is more difficult to make friends. There is also the possibility that other family members will have greater financial responsibility. As DINKs age, there may be additional pressure for people within their family to assume they can handle certain obligations. For example, if you have an elderly parent.

DINKs may be the ones who are trusted because it is assumed that you have disposable income or time available to take on these responsibilities. According to experts, the number one tip for DINKs is to prioritize savings and determine clear goals for the future. If anyone is considering becoming a DINK as a financial planner, I recommend that strategy. I recommend it to my clients. When my clients tell me they are going to make an intentional decision, I'm a big fan of that. With that disposable income, make a budget. How do you want to spend it? Make sure you set aside some money for fun, but also make sure you set aside some money for investments (they can be traditional or non-traditional investments), and then review it annually to make sure it still makes sense.

I think if you're considering not having children in your life, make sure your partner is on the same page as you and that you're confident in that value in isolation without your partner as well. Yeah, don't get into the DINK lifestyle like, oh, I don't have kids, so I have more money and I can do whatever it takes, like plan your future, save money. If you're not going to have kids, make sure you save money for your future, because the world is a strange place right now, and who knows what it will be like in another 3,040 years when we retire.