Worried about rising adoption costs? How to make it affordable.

Adoption costs have continue to increase, with some people spending up to $40,000. But, there are some ways to make adoption more affordable.

Mel Evans/AP/File
Paul Yorgey, left, smiles as his husband, Gregory Girdy, right, holds their adopted daughter, Anabella Marie Yorgey-Girdy, at Saint Miriam church in Blue Bell, Pa. Adoption costs have continue to increase, but there are ways for people to make it more affordable.

In a perfect world, you would meet the love of you life, get married, have a couple of kids, and embark on a booming career that afforded you many great luxuries in life. Unfortunately, the fairy tale doesn't always work out that way.

Many couples are faced with the reality that they are unable to have to kids for one reason or another. Not only that, the cost of adoption has skyrocketed, with many adoptions topping $40,000 in costs. When was the last time you had an extra $40,000 lying around?

There's no reason to go broke when you adopt. Here are five ways to afford adoption so you can get your family started right now.

1. Grants

Adoption grants are generally based on some sort of financial need, but for those that qualify, they can provide some much needed cash. A grant is a fantastic way to fund your adoption because they don't have to be paid back…ever. Some organizations are very specific about the qualifications for grants, while others remain more open. No matter what your situation is, there is an adoption grant waiting for you.

Adoption grants require you to be working with a licensed agency and have a home study completed before you apply for the grant. The average cost of a home study is around $2,500, and you can use this home study for grants and loans as needed.

There are hundreds of organizations that offer grants, and a good place to start your search is on Fund Your Adoption. Lori and Jeremy started Fund Your Adoption in 2012 after being swamped with details of trying to find ways to afford adoption. Fund Your Adoption offers a ton of great tips and resources for families who can't quite manage the expense adoption, and loads of wisdom through their experience.

Here are a few of the most popular grant organizations:

  • Help Us Adopt — this organization offers adoption grants for everyone, married or single, and regardless of religion.
  • Gift of Adoption Fund — this organization offers grants ranging from $2K–$5K and accepts all individuals.
  • Show Hope — this organization awards grants averaging $5K.
  • A Child Waits Foundation — this organization awards grants ranging from $1K–$5K and offers grants for everyone.

2. Crowdfunding

Crowdfunding is no longer reserved for Kickstarter type projects funding the latest and greatest gizmo. It has now become a popular tool to raise money to adopt children, too. All you need is a great network of friends and family (or other potential donors), and a compelling story.

Companies like Pure Charity offer an easy-to-use platform to raise an unlimited amount of funds online. Pure Charity takes 5% of your fundraising to pay for fees and administration costs. In exchange, they offer a site with tools like videos and how-tos, and any funds raised can go directly to an adoption agency that you name. This ensures that the funds raised might also qualify to be tax-deductible to the donor. (Make sure you check with your CPA before you set up your campaign to qualify for tax-deductibility.)

Your crowdfunding page is sure to make for an awesome show-and-tell story for your adopted child.

3. Tax Credits

Most people adopting don't realize that they will qualify to receive a tax credit. In 2015, you can claim up to $13,400 in adoption tax credits for qualified adoption expenses. Expenses include a long list of costs, but cover things like adoption and court fees, as well as travel expenses. The tax credit works for all types of adoption, including international, domestic, and foster-to-adopt programs.

If you are adopting Internationally, you will usually need to spend a few weeks in country before you are allowed to take your child home with you. The tax credit could certainly help make a dent in those expensive costs. You will want to make sure you keep very good records, receipts, and details of any costs that you expect to use towards the tax credit. You can hand all those documents over to your CPA at tax time to make sure you are applying the right costs.

One word of caution: the adoption tax credit is a heavily audited item on tax returns. Many people have abused this tax credit and falsified information. The best advice is to use a CPA or accountant the year that you file for the tax credit in case you are audited.

4. Loans

If you are unable to secure grant money, or just need to fill a gap in funds for adoption, loans can be the answer. You'll probably want to exhaust grants and any crowdfunding ideas before you explore loans, unless the idea of putting your adoption story online sounds like such a terrifying proposition that you'd prefer to assume debt, instead.

There are two types of loans — interest-free and low interest. As with any loan, you need to make sure that you can afford the monthly payments once the loan is in the repayment mode.

Interest-free loans are always the preferred method of funding, and there are a couple of great options. ABBA Fund offers loans ranging from $6,000–$8,000 for Christian families, while the Hebrew Free Loan Association offers loans up to $15,000 for Jewish families.

If you can't get an interest-free loan, low interest loans will be your next stop. One of the most competitive interest rates is with A Child Waits, which offers up to $10,000 in funding and charges 5% interest. You have a five-year repayment window, but no penalty for prepayment of the loan. That is still lower interest than most credit cards would offer, but certainly higher than some other options you might have available.

5. Fundraising

If all else fails, good ol' fundraising might do the trick. There are stories after stories of couples that raised enough money for adoption just through fundraising events alone.

Some of the more popular are car washes, dinners, auctions, and T-shirt selling campaigns. Credit card rewards points are also a great way to fund adoption. If you configure your spending properly, you could earn a significant amount each year in rewards points that can be traded in for cash and used towards expenses.

These are a few of the most popular ways to afford adoption, but certainly not the only ones.

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