Why do millennials increasingly choose not to have kids? How expensive are kids really?

A couple of days ago, my friends and I were having a discussion about more people choosing not having kids in India. According to a US based study, some 44% of non-parents ages 18 to 49 say it is not too likely or not at all likely that they will have children someday, an increase of 7 percentage points from the 37% who said the same in a 2018 survey. Sure, though this study is based out of the West, I can expect similar trends for India. Perhaps even starker if you compare 1990s to the 2000s.

Amongst the most common reasons for not having children, what I generally hear from friends who are millennials are that kids are so expensive.

Sure, it is expensive but I wonder if it's that much more (especially with increasing disposable incomes in the last few decades?), so I decided to check on the math to understand if it was really the money or something else as to why millennials and GenZ are increasingly choosing not to have kids.

Overall summary post this analysis: Perfectly fine to not have kids for folks who are in abject poverty, leading an unstable life (eg. traveler influencers, struggling actors) or choose not to have kids because they aren't confident being responsible for another being. These are perfectly valid reasons. However, finance is just a poor excuse for most millennials fearing commitment and being more responsible, at least in most cases. Children at most cost families about 7-9 lakhs a year incremental (basis pretty generous assumptions), whereas existing lifestyles of a couple cost between 30-40 lakhs a year. And, there are many benefits to having children, which I detail below. Sure, it's a hard job but that's where the personal growth is. It's the classic trade-off case in short term vs long term thinking - are you willing to have a few months of sleepless nights or hard teenage tantrums for years of the best and most rewarding experiences? So let's call a spade, a spade.

First, let's look at the math of the finances.

Because I grew up in Mumbai but now stay in Bangalore, I did estimates for both cities. This is for a family of 3 in an upper class Indian family with an annual income upwards of ~INR 40 lakhs a year. While currently the expenses assume a toddler to roughly 12 year old child, expenses for a baby will typically be lesser while a high school/college student might be slightly more. Sure, school expenses, rent, etc. is cheaper in other cities outside of Mumbai but not that much more to create a massive dent in the pockets in Mumbai vs other cities. Moreover, the share of child related expenses as a % of total is pretty much the same at ~22-23% for a couple, roughly between INR 7-9 lakhs a year. Similar to an additional luxurious trip to Europe for two for about 15 days. And yet, in my head, I can't even compare an additional trip abroad to raising a child.

A pretty poor argument to this analysis is that X number is wrong and X assumptions are incorrect. I am all open to hearing your argument especially once you make the effort of putting down the math for yourself and your lifestyle - I don't think numbers change that much. Here's the link to the sheet for download and modification to review basis your assumptions.

Things to get clear though: Choosing to put in an IB/international school when your finances don't support it, is a choice you are making as a parent. So stop complaining then that it's expensive. It's long established that keeping up with the Joneses does no good to anyone. You can't expect schools to deliver if they don't charge parents, inflation-adjusted. At least from personal experience, Vidyasagar is doing a great job engaging my daughter vs what I got in my school or my parents did. So am happy to invest in this education. Then again, the stress that you take for children "getting in" to the Ivy leagues, etc. is on you and not on the child. Having seen much of life, especially professionally, I think the ultimately success boils down to character and has little to do with fancy degrees. Some of the smartest and most successful friends I know went to no-name schools and came from Tier 2 cities. Then, fancy clothes, expensive toys, etc. is again a choice we are making as parents. In reality, Zudio and Max have perfectly good clothes for children. Buying from a Zara or other brands that I currently do not know of, is again a lifestyle choice. And cannot be called as financially draining.

So if not finances, why do people delay / do not have children?

• Focusing on careers or marriage is most common for delaying childbirth. Which is perfectly legitimate reason. However, basis my experience, work never gets easier and there's miles we can do as professionals to make having a family advantageous rather than disadvantageous to an individual. There is no doubt that having children helps people mature, become more empathetic and controlled in their emotions.

• Too much responsibility/lifetime commitment: At the risk of backlash and over-generalization, I do think as a generation we take on a lot less responsibility and accountability in the name of independence and I see that only accelerate more dangerously for GenZ. Sure, we have a lot more help around vs. our parents did. So shouldn't life now be slightly easier than it was then? And, not having children was not as oft then, as it is now.

• The world pretty much sucks: A recent WSJ/NORC poll found that 78 percent of Americans aren’t confident their children will have better lives than they did. Climate change, violence and wars, polarizing worlds through religion and politics are all reasons that many don't want to bring in children to a harsh world. But I argue that children soften the harsh realities of the world. I remember during the worst phase of the pandemic, I didn't feel as depressed as many of my friends did when hearing all the terrible news because I was busy with my infant. The small joys help us along the way.

What are the benefits of having children?

Quite simply: to be happy.

A large literature currently suggests that parents are less happy than non-parents. This viewpoint has many conflicting debates and articles, but research is more complicated and nuanced. I found this research piece most on point: parents became happier over time relative to non-parents. Results are consistent across two datasets, most sub-groups, and numerous specification checks. The study also presents evidence that parenthood may inoculate parents against forces that are reducing well-being.

Ask any parent what is the joy they experience seeing the infant smile, crawl around the house, cheer at the first sports day or witness the graduation of their child from school. No important business review can ever match that. In fact, a poor appraisal is softened by the unconditional loving hug of your toddler. Now, I am not saying that you can't be happy without children or having children is all happiness. Of course, not. But, there's no love and pure joy are parenthood.

Chip Wilson, the founder of lululemon, is most famous for promoting family culture: family values were a key component of the culture we worked hard to build. I believed we should nurture our people’s ability to have families, because I understood that our company would work only as well as their families worked.

As part of our hiring practice, we screened for people who wanted families. We wanted our people to meet the perfect mate, we wanted people to have children, and we wanted the family nucleus to be an energy generator.

Also, remember how hard Will Smith's character hustles in The Pursuit of Happiness. I highly doubt Chris Gardner would be the same success that he eventually was, if there wasn't a motivating factor in his five year old son to achieve more and be better. From personal experiences, I know my father strived harder and I work hard to want a better life not so much for myself as much as for the children.

While parenting can be tough, that doesn’t mean it can’t still lead to happiness, joy and greater meaning in life. The parenting experience can even lead to a profound form of wellbeing called eudaimonic wellbeing. This is the feeling you have lived a life worth living, which is distinct from short-term happiness.