Budgeting & Saving

Adoption Costs: 5 Things to Know

November is National Adoption Month, a celebration of the amazing gift American families give to the 110,000 children who are adopted in the U.S. each year.

Adopting a child is a huge undertaking which can be emotionally overwhelming. In addition to stress, excitement, and uncertainty—there's also tons of paperwork, long waits, frustrating bureaucracy, and major financial implications for anyone brave enough to take on the awesome responsibility of adopting a child.

One mom who recently went through the process stressed the importance of resilience and follow-up. Even if you hear "no" or don't get a response to something, keep trying. If you are setting out to adopt an infant or have specific criteria when adopting, you may have to wait longer as well. Whether you are going the foster to adopt route or doing a private adoption, staying organized and being patient will help you throughout the process.

Here are 5 major things to know before you go down this path:

1. What is the cost of adopting a child?

Depending on which route you take and what state you live in, costs can vary greatly. If you adopt a child through foster care in most states, the costs are low or non-existent. However, the average international adoption costs $42,000 and U.S. newborn adoptions cost an average of $37,000, according to the most recent survey by

There are, of course, also the costs to prep your home for a new child. But you can be budget-conscious with this part by shopping for discount clothes, toys and bedroom furniture to stretch your dollars when prepping for your new addition. If you make a realistic budget (and stick to it), you can avoid taking a big hit to your savings account or racking up credit card debt.

2. What do I need to do to adopt a child?

Whether you adopt through foster care or privately, you'll have to do the following:

  • Complete an adoption course.
  • Participate in a home study where childcare experts visit to make sure you're prepared for a child. The thoroughness or details of these visits vary depending on if you are doing a private adoption or going through foster care.
  • Provide A LOT of paperwork including medical documentation, financial records such as several years of tax returns and bank records, documentation on the health and well-being of any other children or pets in your home to ensure you're properly caring for them, criminal and background checks, and recommendation letters.

People who've been through it recommend getting the documents pulled together ahead of time to ensure you're prepared.

Also, be diligent in keeping your documentation secure and ensure that the agencies or organizations you work with are careful with any paperwork, especially when it includes your Social Security number, account numbers, or other personal information. (See also: What Can Identity Thieves Do With Your Information and How Can You Protect Yourself?)

If you're working with an attorney or adoption agency, do your research and check out their backgrounds. There are horror stories of parents giving money to an agency and the agency going out of business or filing bankruptcy, which means they're out money and/or have to start the adoption process over.

You can check out Adoptive Families, which is a resource for finding qualified professionals to help you and also provides workbooks and checklists for those looking to adopt or going through the adoption process.

3. How much does it cost to raise a child?

As mentioned previously, the good news is that you pay little or nothing to adopt if you go through foster care. Also, many states offer Medicaid benefits and other adoption assistance programs.

But adopting a child is just the beginning. Since the early 1960s, the Department of Agriculture has annually estimated the cost of raising a child, tracking seven categories of spending, including housing, food, and clothing. The most recent report, released in January, estimates the cost of raising a child born in 2015 to age 18 will be $233,610.

Of course, the costs will vary depending on the age of the adopted child, where you raise the child and whether you have to pay for childcare or can rely on friends and family. Notably, the USDA's report does not include the cost of college, which is a huge potential expense. (See also: Should You Use a 529 Plan to Save for Your Child's College?)

There is some good news here—your adopted child may be eligible to receive free or reduced tuition depending on the state you live in (Florida and Texas are two states that offer free college for adopted children). There are also scholarships available for adopted children, so you can look into those as well when the time comes to help ease the financial burden of college.

4. What support is available when adopting?

There may be other financial resources available to you. Many large companies now often reimbursements or matching funds for adoption-related costs, so check your employee benefits to see if you qualify for money to cover some of your adoption costs. There may also be grants and loans available through the National Adoption Foundation.

For emotional support, there are online and local support groups such as those available through the North American Council on Adoptable Children (NACAC). You may also consider working with an adoption consultant who can help navigate the process and act as your advocate for attorneys and others since the process can be overwhelming.

5. Are there any tax benefits for adopting a child?

If you adopt a child other than a stepchild, you can claim the adoption tax credit of up to $13,460 to cover adoption fees, court costs and attorney fees, travel expenses and other expense related to a domestic or international adoption. This credit was made permanent by President Obama in 2013 and was recently threatened by the proposed GOP tax plan.

However, the latest tax plan up for review (as of November 9, 2017) has the adoption credit included again, which is good news for those looking to adopt. The exact amount you qualify may vary depending on factors such as income, so check out the details on