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How much does it cost to adopt a child & why is it so expensive?

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Though it’s talked about much more than it used to be, and the stigma of being adopted is waning, adoption is more prevalent in the United States than you may think. Consider these statistics:

  • 1 in 35 children in the United States is adopted
  • More than 50,000 children are adopted through foster care every year
  • An estimated 100,000 children are adopted through all adoption types every year
  • Around 700,000 children are living with adoptive parents
  • More than 1.2 million children are living with at least one adoptive parent

Fortunately, there is no shortage of families waiting to adopt a child. It’s estimated that at any given time, there are between one and two million couples in the U.S. waiting to adopt. This bodes well for the approximately 117,000 children in foster care waiting to be adopted.

In this article, we’ll answer some commonly asked questions about adoption to help prepare you to engage in the adoption process or help you help someone you know who is interested in adopting.

How much does adoption cost?

The adoption process differs somewhat by the adoption type you’re pursuing. There are three adoption types in the U.S.:

  1. Private domestic adoption: adoption through private providers like adoption agencies, adoption attorneys, adoption facilitators, and other adoption professionals.
  2. Foster care adoption: Adoption through the Child Welfare System
  3. International adoption: Adoption through agencies and other providers in countries around the world.

The adoption process begins the same for all types of adoption, with a home study. A home study is a comprehensive evaluation process that includes the following:

  • Interviews of the prospective parents and other family members
  • Reviews of personal documents, including financial statements and employment records
  • A doctor’s statement with details of your last physical
  • Extensive background checks and interviews with family and friends

According to the Gladney Center for Adoption in Fort Worth, Texas, this step in the process can cost from $2,000 to $4,000.

After the home study is completed, you’ll participate in education and training provided by a state agency that administers the home study. This will cost $300 to $600.

During the home study, you’ll also agree to participate in post-placement visits and reporting by social workers. Fees for post-placement reporting range from $1,500 to $2,000.

If you’re working with a private agency, you’ll face some of your largest fees in the adoption process here, which cover searching for and getting matched with a birth mother. The Gladney Center estimates fees for consulting and advertising can cost between $3,000 to $7,000 for private adoption.

If you’re adopting a newborn, you’ll be responsible for paying the birth mother’s expenses, including medical bills and some living expenses, and her legal fees and travel expenses. The Gladney Center estimates these expenses will cost between $6,000 and $8,000 for parents pursuing a private adoption.

During the process of adopting independently and not through foster care, you’ll be spending considerable time and money using the services of attorneys. Many legal requirements come with adoption, including:

  • Terminating the rights of birth parents
  • Court filings
  • Negotiating birth mother expenses
  • Finalizing the adoption

Depending on the complexity of the adoption, legal fees can cost between $7,000 and $15,000.

The international adoption process can be even more expensive because of travel costs. New Beginnings, an international adoption agency based in New York, says adopting a child in South Korea, for example, can include $6,000 to $9,000 in travel expenses.

Depending on the adoption agency you use for a private adoption, don’t be surprised if your final costs for adoption add up to $40,000 or more.

Adoptions through Child Welfare services are much less expensive if you are already a foster parent and want to adopt. Fees can be as little as $1,000 or less.

[ Related: 5 essential insurance policies for new parents ]

How does financial assistance for adoption work?

Once learning the costs of adoption, many couples begin looking for ways to pay all of the fees involved. There are several alternatives for those without enough cash to pay outright for the adoption.

The most popular form of financial assistance for adoption costs is an adoption grant, primarily because it doesn’t have to be repaid as a loan does. Non-profits typically award grants. Each grant must be applied for, and there is no guarantee you’ll be awarded one.

Adoption loans are also a viable form of financial assistance. They are like standard personal loans in that they come from a financial institution, have a set payment plan, and include interest charges. Many families have found adoption loans to be helpful.

Finally, adoption fundraising is catching on. GoFundMe and other similar accounts can be set up for people to donate to help you cover adoption costs.

Does health insurance cover adoption?

Unfortunately, health insurance does not cover adoption costs. Even though you may be paying delivery and hospital expenses for the birth mother of a baby, the mother isn’t a dependent on your health insurance plan, and they aren’t covered.

The good news is that adopting a child is a qualifying event for your group insurance that allows you to immediately add your new child to your health insurance coverage.

[ Related: Understanding what your health insurance does & doesn't cover ]

Other financial considerations when adopting a child

There are several other important financial considerations to factor into your adoption plans.

The first is budgeting. It’s estimated that the annual cost of raising a child, not including college expenses, is around $20,000. This includes costs for food, clothing, shelter, healthcare, insurance, school fees, activities, and much more.

Another important financial consideration is how time missed at work when your new child arrives will impact your finances. While unpaid family leave generally includes staying home upon the addition of an adopted child, it still is unpaid and will affect your income.

Many employers not yet offering family leave are responding to their employee’s requests to add it as an employee benefit. To aid in recruiting and employee retention, many companies are adding paid parental leave insurance to their benefits programs.

The information and content provided herein is for educational purposes only, and should not be considered legal, tax, investment, or financial advice, recommendation, or endorsement. Breeze does not guarantee the accuracy, completeness, reliability or usefulness of any testimonials, opinions, advice, product or service offers, or other information provided here by third parties. Individuals are encouraged to seek advice from their own tax or legal counsel.

— Published November 4, 2022
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