Raising three children sets the average American family back $54,000 a year – with costs rising upwards of $90,000 in the most expensive places in the country.

But the third child costs parents about 20 percent less than the first, according to analysis by fintech company SmartAsset.

Typically, the price of childcare, housing, food, medical costs and transportation are the highest for the first born, with an annual average of $20,814 nationwide. This drops to $17,413 a year for the second child before falling even further to $16,513 for the third.  

Jaclyn DeJohn, managing editor of economic analysis at SmartAsset, told Dailymail.com: ‘There are marginal decreases in cost as you add children as you can reuse previous expenses to cut down on overall costs per person.

‘For example, if you need to buy a family-friendly car when you are expecting your first child, you won’t incur that cost again when you add a second child.’

Typically, the price of childcare, housing, food, medical costs and transportation are the highest for the first born

Typically, the price of childcare, housing, food, medical costs and transportation are the highest for the first born

The third child costs parents about 20 percent less than the first, a new study from financial technology company SmartAsset has found

The third child costs parents about 20 percent less than the first, a new study from financial technology company SmartAsset has found

SmartAsset examined the costs of food, childcare, healthcare, additional housing and other necessities across 381 metro areas when a family with two working adults adds one, two or three children into their budget. 

Ann Arbor, Michigan, is the most expensive place to raise kids in the US, according to the study, mainly due to its exceptionally high childcare prices. 

Bringing up three children under four in the city will set the average family back approximately $91,063 – with childcare costs hitting a whopping $22,000 a year per infant. 

Raising the first child costs $31,670, according to SmartAsset, but drops to $28,924 for the third – a percentage decrease of almost 9 percent.  

The San Francisco area is notoriously expensive – especially when it comes to real estate. 

The San Francisco-Oakland-Berkeley metro area is the most expensive place to raise a single child, according to the study, at $35,647. 

But if a family does not need to upgrade their housing between the first and second child, they will get a significant reprieve – with the annual cost of a second child falling to $24,988.    

Kalamazoo-Portage, a metro around 50 miles from Grand Rapids, Michigan, follows closely behind Ann Arbor when it comes to the price of childcare, with yearly costs of $20,000, SmartAsset found. 

This meant the annual cost of bringing up three children reached an average of $86,124. 

However, raising a third child in the area costs 11 percent less than the first – with the annual price falling from $30,786 to $27,321. 

Parents’ expenditure on big-ticket purchases such as a car become more efficient when they have more children, DeJohn said, as they are spreading the benefit across more people. 

‘This also applies to other child-rearing costs like food and housing,’ she added.

Ann Arbor, Michigan, is the most expensive place to raise kids in the US, according to the study, mainly due to its exceptionally high childcare prices

Ann Arbor, Michigan, is the most expensive place to raise kids in the US, according to the study, mainly due to its exceptionally high childcare prices

It comes after a landmark study earlier this year revealed childcare costs across the country have shot up by 220 percent in three decades – far outstripping the general rate of inflation. 

The rocketing cost has forced many parents out of the workforce, educational charity the Annie E. Casey Foundation found, with families facing an effective geographical ‘lottery’ with childcare costs varying by thousands of dollars between states.  

Soaring childcare costs are in part due to more parents working – pushing up demand – and the fact centers themselves are underfunded and under-resourced. Childcare businesses survive on margins typically less than 1 percent, the report noted.

When it comes to the most affordable places to add children to the family, metro areas in South Carolina, Alabama, Tennessee and Mississippi come out on top. 

According to SmartAsset, Sumter in South Carolina is the cheapest area to raise three children. 

Bringing up a first child in the area costs $14,702, the study found, dropping to $13,105 for the second, and just $9,742 for the third – totaling $37,549. 

In Gadsden, Alabama, parents will have to pay $15,261 to look after their first kid, decreasing to $13,184 for the next and $10,037 for the third. 

The study comes as couples boast on TikTok about the benefits of a ‘DINK’ lifestyle – meaning ‘dual income, no kids.’

Hilary Bowles, pictured, has attracted a cult following for documenting her lifestyle as a 'DINK'

The 30-year-old has shared dozens of clips of herself and her husband enjoying luxury vacations on boats, beaches and safari parks

Hilary Bowles, left, has also attracted a cult following for documenting her lifestyle as a ‘DINK’

The term ‘DINK’ dates back to 1987 and was first coined by the Los Angeles Times when researchers noted that stalling incomes were deterring would-be parents from starting families.

But it has gone viral again on social media amidst high inflation and rising childcare costs. The term ”#DINK’ now has over 205 million views on TikTok.

TikTok star Hilary Bowles has similarly attracted a cult following by documenting her life as a ‘DINK’.

Bowles shared one video of herself and her partner on holiday in Bora Bora, with the caption: ‘In our married, travel the world, pre-kids, dual income era.’

In another post she shared a clip of herself opening a Chanel shopping bag in front of the Eiffel Tower in Paris.

It was followed by dozens of clips of herself and her husband enjoying luxury vacations on boats, beaches and safari parks.

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