Child poverty trap: When offspring lead to poverty

2026-08-14

Germany’s birth rate has fallen to a record low as the cost of raising children continues to rise. New data shows financial pressure is playing an increasingly important role in people’s decisions about starting a family.

A survey published in June by market research company GfK found that 66% of respondents cited the high cost of children as a reason why many people choose not to have a family. Financial concerns were the most frequently mentioned factor in the survey.

The financial impact of having children can be particularly severe when household expenses increase while a parent reduces working hours to provide childcare. This can create a double burden: families face additional costs while simultaneously losing part of their income.

The Bertelsmann Stiftung identifies several factors that can increase the risk of poverty among families. These include limited opportunities to work, high housing costs and inadequate maintenance payments. The financial situation can become especially difficult for households that cannot maintain full-time employment because of childcare responsibilities.

Housing is another major pressure point. Families need more space as they grow, but larger homes often come with significantly higher rents or purchase prices. When combined with everyday expenses such as food, clothing, childcare and education, the additional financial burden can quickly become substantial.

However, the figures do not mean that having children automatically makes families poor. Household income, employment arrangements, housing costs and access to financial support all play important roles in determining how much pressure a family experiences.

The issue is becoming increasingly important for Germany as the country faces a declining birth rate. If financial concerns continue to discourage people from having children, the trend could have consequences far beyond individual household budgets, affecting Germany’s future workforce and demographic structure.

The debate therefore goes beyond the question of how much children cost. It also raises questions about whether Germany provides enough support for parents to combine employment and family life without facing serious financial disadvantages.