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Most potential adoptive parents worry about the challenges that come with financing adoption. Whether the adoption takes place in the U.S. or abroad, on average, most families must finance (before tax credits and employer adoption benefits) between $25,000 and $35,000.
Depending on the birth mother’s circumstances, for domestic adoption, or the country fees and travel expenses, for international adoptions, costs in some cases are significantly higher. The costs for adoptions from foster care tend to be significantly lower, often $0.
Fortunately, financing adoption doesn't always happen at the start of the process. Early on, there are fees for applications, dossier preparation, and homestudies. Later, bigger expenses are incurred, when domestic adopters may pay for medical and legal expenses and travel costs, and international adopters make travel plans and pay fees in their child’s country of origin.
For many families, a significant portion of the cost of adoption can be recouped after the fact. Depending on income level, families may qualify for the federal adoption tax credit ($13,190 in 2014). In addition, more and more companies offer adoption expense reimbursement as part of their benefits packages.
But even with this help, it’s a challenge for most families to squirrel away enough money. The solution, for many, is to come up with new ways to raise money. Lillian Thogersen, interim chief executive officer of World Association for Children and Parents (WACAP), says, “I have never seen a family who wanted to adopt let money stop them.” We polled families from all walks of life to find out how they funded their adoptions, so you can use their ideas to create your own plan.
Financing Adoption: Tapping Assets, Taking Loans
Most families use assets — and credit — to fund their adoptions, often paying back the money later with tax credits. After tapping savings accounts, some prospective parents take out loans against their 401K accounts or the equity in their homes. For Molly and Lewis Newcomb of Livonia, Michigan, a home-equity loan was the answer to their funding dilemma. “The cost was a big barrier,” Molly says. “But if you need a new car, you wouldn’t agonize over the cost or try to save up $20,000 in cash — you would finance a new car and make monthly payments. Isn’t a baby worth more than a new car?”
For families without these assets, adoption loan programs and low- or no-interest credit cards are the answer. Kathy Johnson of Poway, California, took that route for her second adoption. “I charged everything I could on a zero-percent-interest credit card. When I got home, I worked like crazy to pay that card off before the interest kicked in. I called the second one my ‘Visa baby.’”
Financing Adoption: Tightening Their Belts
Savings (including retirement accounts) and loans paid for Rhonda and Boyd Runnels’ adoptions from Korea and Ukraine. Then a little boy on an agency’s waiting child list caught Rhonda’s eye. The child had had open-heart surgery, and there was a possibility he might need further operations. “The agency offered a reduction in fees, and the A Child Waits foundation offered a grant,” says Rhonda. There was still $7,000 to raise, however. “We fell in love with this baby and wanted so badly to adopt him…but how could we afford a third adoption within two years?” In addition to a loan from their 401K, the Runnels covered costs by revamping their budget. Rhonda borrowed books about frugal living from the library. The family put their Christmas money into a “Luke fund.” Daughter Kristin, now 17, donated her babysitting money, and Boyd’s mother gave the family the travel money they needed. Rhonda contributed $300 to $400 a month by becoming a “mystery shopper,” and slashed the family’s monthly budget by:
- Cutting the family’s food budget in half by “taking couponing to a new level.” Monthly savings: $400.
- Eating in and packing brown-bag lunches. Monthly savings: $200.
- Raising the family’s homeowner and automobile insurance policy deductibles. Monthly savings: $100.
- Refinancing an auto loan at a lower rate. Monthly savings: $48.
- Negotiating better phone rates. Monthly savings: $23.
The family was able to bring the baby home to Oklahoma, just 12 weeks after they decided to adopt. “The wonderful thing was the fact that we worked together as a family,” Rhonda says.
Financing Adoption: Moonlighting and Fund-Raising
Many families cobble together the cash through a variety of fund-raising activities. “It would take less time to tell you what we didn’t do,” laughs Christine Buckley-Clement of Lincolnville, Maine. Along with a $10,000 loan and a $2,800 adoption grant, Christine and her husband raised nearly $10,000 through a seedling sale, picture-framing parties, a dinner dance and silent auction, and selling items on eBay. It took a year to raise the money; Christine looked upon the effort as a part-time job.
Jeanne and Michael McManaway of Martinton, Illinois, brought home Ethan Jae, now three, from Korea. “I made quite a bit by selling everything that didn’t mean as much as having children does,” says Jeanne. She sold her own collectibles and belongings, along with items donated by friends and things she found at garage sales. (A magazine she bought for 10 cents at a garage sale sold for $20 on eBay.) She shopped department-store sales, too, buying evening gowns for 80 percent off and selling them for full price. Jeanne’s eBay sales netted $2,500, and she earned an additional $1,200 by selling Avon products.
Financing Adoption: Getting Help from Loved Ones
When Michelle and Mark McKinney of Simi Valley, California, decided to adopt, Mark suggested asking family and friends to sponsor the couple in a marathon. Michelle, who runs regularly, already had a marathon under her belt, but for Mark, who was not a runner, it was a huge undertaking. The couple sent a fundraising appeal to 100 friends and family members. “I thought we’d raise about $10,000 through the sponsorship letter,” says Michelle. “Mark said we’d raise much more.” Mark was right — they received a total of $27,000 in contributions. “We were overwhelmed,” says Michelle. “It was a confirmation that we were doing what we were ‘called’ to do.”
On race day, Mark surprised Michelle by donning a T-shirt that read,“Running for Our Baby.” Michelle plans a special purchase after they bring their baby home from Taiwan: “We’ll definitely buy a baby jogger.”
Lisa and Scott Sweeder of Sterling Heights, Michigan, agonized over how to fund an adoption without destroying their finances. Then, Lisa received a message that changed their lives forever. “Out of the blue I got an e-mail from my father-in-law offering whatever we needed as an ‘advance on our inheritance,’” she says. “They said they did not want such an important decision to be made based on money, [rather] than on what was in our hearts. Needless to say, we were stunned!” The couple was concerned about how Scott’s parents would do without the money. “They said, if worse came to worst, they’d borrow from us in their old age.” Scott and Lisa paid back part of the money with the tax credit they received after they brought home Maia, now two, from Korea. She is, Lisa says, “the apple of her grandparents’ eyes.”
Co-workers helped Debbie Gonzalez of Chester, New Jersey, bring her daughter home from China. Baby showers for co-workers are a tradition at the high school where Debbie teaches. But she was speechless when she walked into what she describes as “the biggest shower ever given…there were 80 people, and enough gifts to fill my living room.” The grand finale was a generous gift—a check for $1,000, to pay for Gonzalez’s plane fare. “I started to cry, and I am not one who cries easily,” she remembers. “Everyone was so interested and excited. It was an amazing outpouring of love.”
Whether it means taking a second job, skipping dinners out, or relying on a little help from their friends and loved ones, nearly every family can find a way to make adoption an affordable option for them.
Read the results of our Adoption Cost Survey.