According to the Ministry of Social Affairs, in 2025 the average cost of raising a child in Estonia is estimated at €564.62 per month. This figure includes expenses such as food, clothing, footwear, housing, transportation, communications, leisure activities, extracurricular education and other direct costs.

After deducting child benefits and large family support payments from this amount and without accounting for potential economies of scale, the monthly out-of-pocket cost for parents is €484 in a one-child family, €969 for two children, €983 for three, €1,448 for four and increasingly more for larger families.

These calculations are based on the final report of the study "Analysis of a Child's Needs-Based Minimum Support Payment," conducted by the University of Tartu's Center for Applied Social Sciences and PricewaterhouseCoopers Advisors. The study was commissioned by the Ministry of Justice in the late 2010s. In 2019, the monthly average cost of raising a child was calculated at €388.

One of the study's consultants, University of Tartu emeritus professor and population and statistics expert Ene-Margit Tiit, said the researchers largely relied on household budget surveys that examined families of different types and compositions. "Our task was to identify from that data which part related specifically to children's expenses," Tiit explained.

According to Tiit, this was a methodologically complex issue as many household expenses are shared. "How do you divide heating, lighting or living space between a child and an adult?" she asked. To achieve as accurate a result as possible, researchers used internationally recognized scales and methods.

"This is certainly important for targeting support to households with lower living standards. In that sense, I believe this knowledge is undoubtedly necessary for the Ministry of Social Affairs," Tiit said.

She emphasized the importance of service-based, rather than purely financial, support.

"Monetary support doesn't always directly benefit the child and I've stressed this point repeatedly. What truly matters for families is that the state is child-friendly and visible through a range of services. Simply handing out cash usually doesn't achieve the desired outcome," the researcher noted.

"For example, child benefits or large family benefits are money directed to the family, not necessarily the child. Money that goes directly toward a child's sports or extracurricular activities is support for the child. Money given to a family, however, might go toward plugging other budget holes or helping other family members — it's not targeted support for the child," Tiit said.

She noted that politicians tend to focus on more visible forms of support, while services are harder to promote.

"For politicians, the question is: what's easier? It's likely much simpler to hand out money than to organize a variety of services. Whether it's extracurricular schools or even school lunches, arranging services takes more effort and is harder to promote than saying, 'We're giving families this much in support,'" Tiit said.

She added that many politicians don't think about what is actually more beneficial for families; rather, they think about what's easier to market and how to claim, "Look how much support we're giving families."

Researcher: Effect of family benefits on birth rate underestimated

In an opinion piece published Monday in Delfi, Tallinn University demographer Mark Gortfelder cited last year's average monthly child-rearing cost to illustrate how expensive it is to raise a child. In his view, these financial demands play a significant role in Estonia's currently low birth rate.

"My emphasis was on the fact that the monthly cost of raising a child — around €564.62, slightly less when benefits are factored in — is still a substantial amount. It adds up and the total cost of raising one child exceeds €100,000. In today's context of low birth rates, that's a major factor. These costs exist and they don't always allow people to live or access services in the way they would ideally like," Gortfelder said.

He believes that neither the public nor policymakers take the financial argument seriously enough.

"I'm not saying that this amount explains everything, but I'm putting it on the table. Especially considering the past few years in Estonia where an economic crisis has clearly pushed costs up, it's odd to me how the economic argument is so easily dismissed," he said.

Gortfelder disagrees with the framing of support as a choice between services and cash, calling it shortsighted.

"What are these 'services' people are talking about, anyway? Liberal parties that have formed coalitions here have often said that services are important, but they haven't identified a single specific service that should be expanded," he said.

"There was once an idea from the Social Democratic Party to allocate part of the benefits specifically for extracurricular education. That might be one solution. Another could be not just supporting extracurricular learning through benefits, but increasing direct state funding for extracurricular providers. But in recent years, under various party leaderships, that funding has actually been cut," Gortfelder explained.

He stressed that the cost of raising children is a critical factor that should not be underestimated when analyzing low birth rates.

"Historically, raising children was economically and socially beneficial for families. Modern society has changed that — now the main driver is a person's inner desire and that's one reason why fewer children are being born. In the end, it's still a significant cost," he said.

Gortfelder declined to make a specific policy recommendation. "I'm fully open to the kind of social democratic approach I've just described. If we look at the current low birth rate, then in a few years we'll reach a point where there's structural unemployment in extracurricular education because there won't be enough children. I'm not opposed to increasing support for extracurricular programs," he said. He added that expanding services would also help reduce the financial burden on parents.

He argues that while the potential positive effects of direct financial support to families are often underestimated, other factors — like access to childcare, parent-friendly work environments, family-friendliness in society and urban design — tend to be overvalued.

"Childcare issues are mostly regional. You can't really say that we have serious, nationwide problems with preschool access. The real questions are why preschool fees vary so much and why, in some areas, there's no spot available near home. But the goal of my article is to show that these issues are being overstated," he said.

Gortfelder noted that while flexible remote work is a good thing, surveys asking people about the conflict between work and family life don't show it as a major concern.

"Generally speaking, balancing work and family life is easier today than it was twenty years ago when fixed hours were the norm," he said.

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