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Couple with adopted child

Is becoming a parent one of your biggest dreams? If so, then you may feel like nothing can stand between you and your future child. Whether it’s paperwork, research or money – you are prepared for anything. But adoption is a complicated process, and so are the associated costs, which may be part of the reason the number of adoptions is declining. The total amount of money a prospective parent or parents will put out changes from situation to situation. If you are interested in adopting, here is a glimpse into the process and the options available to you.

One of the wisest moves you can make as you plan an adoption is to work with a financial advisor with experience in this area.

Factors That Impact the Cost to Adopt a Child

Various factors influence how much it costs to adopt. For example, the type of adoption can impact the price, whether it’s through an independent adoption, a domestic adoption agency, an international adoption agency or the foster care system. The payment structure associated with each of these changes from professional to professional.

There are other variables expenses that fluctuate between each adoption, too. From medical bills to legal costs, each adoption is different.

If you want to get a solid grasp on the price you should expect, begin researching as soon as possible. Speaking to those with experience can also help you get a clearer estimate.

How Much Does It Cost to Adopt a Child?

Again, costs can range wildly. It all comes down to the channels you use and the type of adoption you seek: the foster care system, domestic or international. It’s hard to predict exact out-of-pocket expenses: You could pay anywhere from nothing to $50,000.

Exploring multiple avenues will help potential parents find the right method for their financial situation. Keep in mind that depending on which method you choose, you may encounter a number of different fees. Amounts will also change between each option.

Domestic Adoption

Mother and adopted childGenerally, adopting a child from the U.S. incurs some pretty high prices. Of course, it all comes down to the adoption professional you work with and the particulars of your situation. But domestic adoptions are generally an expensive option. For example, American Adoptions’ domestic program ranges from $50,000 to $60,000. On the other hand, the Child Welfare Information Gateway, an individual adoption from a private agency can incur costs from $20,000 to $45,000. So, it all depends on the professional group you use.

The agency is typically the largest expense in your overall total. Agencies use different payment systems, one or more of which may benefit you. Some use a fixed rate, while others use a partially fixed rate or service fee. You can contact the agency for a breakdown of the expenses to see what’s covered. Some fees you may see include a home study and legal fees, plus associated fees for the expecting mother.

Pursuing an independent adoption, where you directly connect with an expectant mother, may be slightly less expensive. At around $15,000 to $40,000, you may still have a laundry list of fees but a potentially lower price overall.

International Adoption

The costs of adopting outside the country will depend on where the child is from and can vary significantly. You may have to pay for a number of additional costs as well, including escort fees, translation fees, foreign agency fees and counseling after the child’s placement. Overall, the Child Welfare Information Gateway estimates a slightly larger range than the domestic adoption, from $20,000 to $50,000.

International adoption, or sometimes called intercountry adoption, also comes with another unique set of challenges. You may have to travel the child’s country multiple times before they can come home with you. That means you should budget enough into your savings to cover several rounds of transportation costs, hotel fees and more.

In addition, the country may change its adoption policies suddenly. This can not only be disappointing but financially draining.

For example, the enactment of the Dima Yakovlev Law in 2012 officially banned U.S. residents from adopting children from Russia. Additionally, multiple countries deny LGBT couple applicants. So, some places may not accept you as a potential parent or have strict requirements. Researching the rules and regulations of a country before adopting internationally can help you identify the best option for your family.

Adopting from Foster Care

Parents who want to give a child a home but have a smaller budget should look into foster care adoptions. This choice is generally the most affordable and comes at little to no cost. That is because the state reimburses families for taking in these children. The compensation covers any required adoption fees, such as attorney fees and the home study. Many children in the foster care system need a loving home and a permanent family. However, that is not the case with every child. In some instances, the goal is to reunite them with their birth family.

According to the Children’s Bureau and data from the Adoption and Foster Care Analysis and Reporting System (AFCARS), 423,997 children were in foster care on Sept. 30, 2019. Of those 423,997, 28% had a case plan with the goal to be adopted. In contrast, 55% of the children had case plans with goals for reunification.

So, while foster care adoptions are minimal cost-wise, they are difficult in a different way. Your child likely has experiences with their birth family that will impact them long-term. Navigating that together comes with its ups and downs.

Adoptions Expenses

Looking at the flat costs for adoption can be overwhelming. Breaking down the total into the expenses it covers can help you understand the official price point. However, each method of adoption involves a different array of expenses.

Domestic adoption can reach as much as half of a million dollars. But when using an agency, that can include costs like:

  • Support for the birth mother on a 24/7 basis (outreach, medical expenses, legal expenses, living expenses and counseling)
  • Help from an agency to create a profile
  • Your home study
  • Adoptive parent education
  • Background screenings
  • Hospital documentation
  • File management
  • Social worker services
  • Post-adoption support

If you pursue international adoption, then you are also looking at:

  • Travel expenses, possibly up to three round trips
  • Passport fees
  • Dossier authentication

Even adopting from foster care will lead to certain expenses. While the government reimburses the upfront costs, there are still post-adoption services. In particular, counseling and education, which will help support your family.

Strategies for Paying to Adopt a Child

Father and adopted child

It’s easy to get overwhelmed when you see the numbers. But you don’t have to shoulder the costs alone. There are a few systems in place that can help you finds ways to pay for an adoption. For example, tax benefits for adoption include both a tax credit for qualified adoption expenses paid to adopt an eligible child and an exclusion from income for employer-provided adoption assistance. The Federal Adoption Tax Credit helps lessen the financial burden following an adoption, including attorney fees and travel expenses. Parents must meet certain criteria, but they can receive up to $14,300 per eligible child.

Your job may also be another option. Check with your employer to see if there is a sponsored adoption assistance program. Only 10% of employers surveyed in SHRM’s 2019 Employee Benefits research report offered adoption assistance. But that’s up to tens of thousands of dollars you can use to recover financially.

Certain groups sometimes fund adoptions through grants as well. If you are a member of a religious organization or part of an LGBT couple, consider exploring the options in your community.

The Bottom Line

Adoption is sometimes hard-won, but creating a family can be worth the cost. Many of the steps, such as the application and home study, entail significant fees. The type of adoption you puruse, whether foster care, domestic or international, also affect the cost and length of time the process takes. The federal government offers a significant tax credit to adoptive prents. Check to see if your state provides something similar.

Tips for Investing

  • Maybe you realized you wanted to adopt young, or perhaps it’s a recent decision. Regardless, starting earlier allows more time for planning. Saving early on will give your savings the chance to collect compound interest. In turn, you can put those funds towards the associated adoption fees. If you want to track your investment’s growth, consider looking at our investment calculator.
  • Adoption can be a worthwhile but hefty financial cost. You want to have control over a stable financial foundation before you bring your child home. A financial advisor can help you organize your finances beforehand to make the process seamless. SmartAsset’s free tool matches you with local advisors who have the skills to guide you. If you want help as you aim to achieve your financials goal as a future parent, get started now.

Photo credit: ©iStock.com/gradyreese, ©iStock.com/SDI Productions, ©iStock.com/Umkehrer

Ashley Kilroy Ashley Chorpenning is an experienced financial writer currently serving as an investment and insurance expert at SmartAsset. In addition to being a contributing writer at SmartAsset, she writes for solo entrepreneurs as well as for Fortune 500 companies. Ashley is a finance graduate of the University of Cincinnati. When she isn’t helping people understand their finances, you may find Ashley cage diving with great whites or on safari in South Africa.
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