How Much Does a Family Cost?

This is an article I wrote for our Economics Magazine in 4th year high school.

Families are important. It has existed way back before civilization did. No species would have survived if it wasn’t for the existence of families. Ironically, divorces, abortion, disrespect, rebellion, and running away from families are becoming more and more rampant nowadays. It seems that families are losing their importance. Or are they?

To measure how much a family costs to a person, we can also measure how much a family spends on that person (expenditure approach). Assume a fictional middle class high-school person named Marfred San Antonio in a family of five. Marfred was given vaccines after he was born, so he could have a greater immune system. He gets a BCG vaccine, which costs around P1700, another one for measles, which is around P1500. The vaccine for chicken pox is about P1200, and for MMR, P600 each shot for 2 shots. DPT and Polio vaccine require 3 shots and 3 booster shots costing P2500 each shot. The same dosage is needed for Hepatitis B and A vaccine, but each costing P700 and P2700 respectively. Lastly, immunization against typhoid fever is P1500 per shot for 2 shots. These total to P73,800. These vaccines are not only a pain to the family, but also to poor Marfred.

Man does not live on vaccines alone. Baby Marfred also needs food, clothing and shelter. His milk costs P900 per can, which can last for about 2 weeks. In his sixth month, his soft food might cost P35 a piece, eating once or twice a day. This gives a total of about P85000 for Marfred’s food. His clothing can get as cheap as P240 for three months and diaper for P8 a piece, giving a total of about P100,000 for Marfred’s basic necessities for 2 years.

Let us click the fast forward button on the remote of time and space. Marfred is now studying in a nearby school. Costs increase as one puts more input. Marfred’s food now costs P120 a day and his clothing also increases to P500 for three months. This sums up to about P140,000 for his 3 years of preschool.

Another click brings us to his elementary days. Here come new classmates, new lessons, new challenges, and new burdens, not only for Marfred, but also for his family. He is now a growing boy, and starts eating P150 worth of food a day. His clothing also now amount to P1200 for 4 months. Furthermore, he starts receiving allowance of P100 a week. His school is now a bit far that he needs to spend P200 a week for his transportation. That amounts to P443,700. It seems like six years in a public elementary school isn’t so cheap after all.

Marfred finally steps onto high school; not just on any ordinary high school, Philippine Science High School. He eats a lot more than before and spends P200 a day for food. His clothes are also very costly. P2000 are spent every 6 months. His allowance also increases to P300 a week. His high school is quite far from their home, and costs him P100 a day. His projects, class funds, and other educational spending reached P50000. A stunning total of P566,400. On second thought, six years in a public elementary school is cheap after all.

Throughout his life, Marfred is also using electricity, water and the house itself. To make things simpler, we can say that his electric and water bill costs P300 and P50 a month respectively since these values do not fluctuate very much. The house also has a net worth of P700,000 and therefore an equivalent annual cost of P28,000 assuming he lives in it for 25 years. P483,000 for his total utilities.
The San Antonio family spent a grand total of P1,806,900 for Marfred. Of course, you can guess that there is something wrong with this calculation. We missed out a lot of things. We did not bring into account the inflations and appreciations. Also, his parents are not freebies. They cost about P15,000,000 each in terms of the money spent on them. His three siblings are also worth a little less than he is, giving a total P35M. But, most importantly, the time spent for him by his mother and father is more valuable. The opportunity cost for this time is about P1000 per hour. Instead of earning P43,800,000 in 15 years, Mrs. San Antonio spent it on her beloved Marfred instead. This brings a total spending of P120M, which is equal to the family’s worth from Marfred’s point of view. These values are approximate, but not too far from the real value, so we may well say that the value ranges from P100 to P150M for a middle class teenager like Marfred.

But, the real value of the family lies in the very heart of economics: scarcity. No matter how many P120M you have, you cannot buy families, because there is only one family for you. This makes families invaluable, because once lost, there can be no replacement. There is so little supply and so much demand that the price exceed the cost by a factor of infinity. Not only that, there are things that we cannot simply put a price tag on, such as love, support, security, and the unbreakable ties that bring the family together. These things are exactly the things that we forget to value, but are the things that count the most. In any case, if you think your family is not good and unimportant, just think about the P120M they spent on you.