Wednesday, June 1, 2011

Investing in Children

A friend of a friend brought a kid over to my house the other night.  Maybe it was last night.  It got me thinking about why people have kids.  It doesn't seem to make very much sense.

As far as investments in the future go, there are plenty safer bets.

Even before the child is born the cost of having and raising one start to add up.  Doctors visits to check on the heath of the baby and all that jazz.  After that comes the extravagant cost of actually delivering the thing.  You've already dumped thousands of dollars into your investment without any clear sign of whether or not you will get anything in return.

So the baby is born.  You have even more stuff to pay for.  You've got food, clothes, diapers, cribs, etc.  The list could literally go on forever.  Involved in this is probably the biggest cost.  The loss of productive time spent raising them.  Babies require inordinate amounts of attention.  Assuming your skills dictate that you can come out better by working, you can still work and pay someone else to watch the child.  This goes on for what seems like eons as children are not quickly able to care for themselves.

Even after they can supposedly take care of themselves, they really can't.  As the child turns into a teenager you might think the costs would go down.  Maybe you're kid becomes an athlete.  Athletes need a lot of clothes and gear and such.  Expensive.  Maybe your kid is super smart.  Again, these children need lots of stuff.  They want lots of books and calculators.  Ugh, calculators.  Expensive.  Maybe, and hopefully not, your child is just a bad seed.  Lawyers?  Expensive.  If you somehow make past all of this without going bankrupt or losing your mind.  There's still college!  Expensive!

I can only assume people hope that as they grow older that their children will take care of them as they slowly turn old.  What are the real chances of that?  We can assume by the rate at which people save for retirement that even they don't believe their children will take of them.

So, in the end what's really the point?  Dump capital into what seems like a black hole for at least 21 years but probably more like 25.  What is the incentive for people to go through this whole process?  Why would anyone in their right mind want to have a kid?

I don't know the answer to that question, but they sure are cute.

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