Would You Have A Child For $101,000?

Hypothetical question: Would you have a child if you could receive $101,000 in return?

In Seoul, a construction company is offering 100 million Korean won (roughly S$101,000) to its employees each time they have a baby. At least 70 employees have benefitted from this.

This initiative comes at a time where South Korea is recording dangerously low fertility rates. In 2022, South Korea had the world's lowest fertility rate of 0.78, a number that is expected to drop even further to 0.65 in 2025 based on national statistics.

Meanwhile, Singapore’s birth rate hit rock bottom at 0.97 in 2023. That's the lowest it has been in our history, placing us among countries with the lowest birth rates in the world. Not unlike other developed countries, women in Singapore are also choosing to have children later in life, or not at all. 

Over the years, the Singapore government has been offering financial incentives to get us to make babies, but these have not been successful at moving the needle. In 2023, the government increased its Baby Bonus cash grant by S$3,000 and adjusted the payout schedule to regular six-month intervals.

Enhanced Baby Bonus benefits after the Budget 2023 announcement. Source: MSF

Just before the Chinese New Year in 2024, Prime Minister Lee Hsien Loong publicly expressed his hopes that more couples would embark on parenthood. He hinted that more government support for families aspiring to have children is on the way.

Will it make a difference if more money was given, though?

As the cost of living in Singapore rises, cash bonuses provide financial incentive for couples to have children. This baby bonus could help to offset the costs of childcare, education, and other expenses.

What if the government gives you $101,000 to have a child?

Being able to get $101k for having a child sounds like a good offer… until you start calculating the actual costs needed to raise a child. Raising a child in Singapore - arguably the world’s most expensive city - isn’t cheap. For some people, $101k can go a long way. If you live frugally and keep a tight rein on your budget, that money could last you for several years, but even that won’t be enough to pay for university fees by the time your child comes of age.

After my first child was born, I tracked our expenses and found that we spent $25,000 to raise him in that year alone. These were mostly on essentials such as diapers and formula, and despite us not going for branded options unlike many parents influenced by social media. Having said that, you could spend less than we did on delivery fees if you opt to give birth in a lower-class ward in a public hospital and skip the epidural.

Today, with two kids, we find ourselves paying around $8,000 each year just for preschool fees and one enrichment class per child. Once you factor in food, activities, holidays and gifts, that figure escalates.

The government has doled out various subsidies to help families with the costs of raising a child, which we are really thankful for. I have friends who are single mothers, and the subsidies make it possible for them to raise their child despite the lack of financial support from their ex-spouse.

But money is not the only issue.

Career considerations. Long working hours. Lack of affordable childcare.

Aside from the high cost of living, there are deeper issues to be addressed if we wish to reverse the declining birth rate.

More women are choosing to delay having children because they fear a slowdown in their career progression. They prefer to wait until they’ve climbed high enough so that having children will not be a serious threat to their income when they take time away from work.

I feel this deeply, because I took a step back in my career after I became a mother. Back then, I had climbed the corporate ladder for years to hit my goal of becoming the head of three departments: accounts management, marketing and sales.

After I became a mother, I could no longer cope with the workload and long working hours. Fielding calls at night with my colleagues in a different time zone started to feel like a chore, and I resented it. My mental health got worse.

So I quit and settled for a less demanding senior manager role at a competitor firm, at a 50 per cent pay cut. But it was what I needed to get back on my footing.

What I faced is not atypical among Singaporean women. Some of my friends have done the same, while others quit to become stay-home mothers instead. 

Companies need to have policies that are progressive enough, such that female staff need not choose between career progression and being a mother.

The lack of affordable childcare options is another challenge. Plus, parents need to save up for university or higher education fees that loom in the horizon.

What’s more, not every family has the privilege of having grandparents to help look after the kids while the parents go to work.

Why I will not have another child for $101k

My husband and I were open to the idea of having three children in the beginning.

But after our second child was born, we decided to Stop At Two and started looking into permanent birth control methods so we would not get a surprise later down the road.

Why? Because the amount of time, money and emotional resources needed to parent our two children on a daily basis has taken a toll on us. As working parents, we struggle a lot with guilt and often wish we could spend more time with our children. When our kids fall sick or fall behind in their academics, we blame ourselves and wonder why we don’t have more time to nurture them more closely.

At this stage, we can safely say that we have no more bandwidth left to raise another child, whether or not the government gives us $101,000 for it.

Dawn Cher is a mother of two boys, 5 and 3, and the founder of financial blog SG Budget Babe. She is also part of the sandwiched generation, and constantly questions what more can be done to help peers like herself who grapple with caring for both the young and old.