Thinking about adoption,
but not sure which kind is right for you?
Here’s an overview
of options—how they work and what they cost

1. Adopting Through a Domestic Agency
2. Adopting Independently
3. Adopting Internationally
4. Adopting a Waiting Child
5. How to Adopt Smart

If you’re just starting out, be prepared: Adoption today is not what it was just a decade ago. Do you prefer a closed adoption, in which the birth parents remain anonymous? Or are you comfortable with the increasingly common open adoption process, in which you actually meet—and sometimes stay in touch with—the birth parents, usually the birth mother? Would you rather use an adoption agency or a private adoption lawyer, or seek a child through advertisements you place on your own? Would you consider adopting a child from another country? Could you parent a child whose racial or ethnic background is different from yours?

Families have more adoption alternatives now than ever before. Each comes with its own set of emotional and financial risks and benefits. To help you lay out the smartest possible plan, we will explain the various routes to adoption as well as how to limit your expenses so that you’ll have more money left to buy teddy bears and diapers and start saving for your child’s college education.

Adopting Through a Domestic Agency

In the past, families using an agency to adopt a newborn usually put their name on a list and waited for an agency social worker to make a match. Today, the birth parents get more of a say in choosing their child’s adoptive parents. In the most common approach, the agency sends biographies of three or more sets of prospective adoptive parents to the birth parents, who pick the one they are most comfortable with. Then a meeting is set up for birth parents and adoptive parents to get together. This is what’s known as an open adoption, and today at least half of the 15,000 or so domestic agency placements of infants each year involve birth parents and adoptive parents who have met each other.

While the recent trend toward openness seems threatening to some adoptive parents, many of them say that it removes the mystery from the adoption process and allows them to better answer their children’s questions about who their birth mother was and why they were adopted. This can help immeasurably in allowing a child to come to terms with being adopted and feeling OK about it.

How open the adoption ultimately becomes depends on the agency and on the wishes of the birth and adoptive parents. In some cases, adoptive parents are in the delivery room for the birth and visit the birth parents over the years. But typically, after the initial meeting the adoptive parents and birth parents don’t see each other again, though they might communicate at regular intervals through the agency—for example, on the child’s birthday and at holidays. If you want to adopt the old-fashioned way—that is, having no contact with the birth parents at all—you should look for an agency that still conducts closed adoptions. Some still do. But most now encourage varying degrees of openness, and if you insist on a totally closed process, your wait to become a parent may be much longer.

Fees vary widely around the country and, naturally, are affected by the types of services you get. At a few nonprofit agencies, such as Homes for Black Children in Detroit, there are no fees other than the $100 to $150 court filing costs. Far more common are agency charges of $12,000 or so that include the cost of the home study, counseling for birth parents and prospective adoptive parents, medical expenses and foster care, if needed. Usually you will be able to pay agency fees in stages. But be on your toes. It is always a red flag if an agency requires all fees prior to placement. Most reputable agencies ask for payment of two-thirds of the fees before placement.

Adopting Independently

To mark the new year of 1998, Elise and Robert Sandiford of Los Angeles sent notes to their friends expressing their wish to adopt a newborn. A former neighbor in Chicago gave the letter to her rabbi, who passed it along to a pregnancy counselor in Colorado, who showed it to a teen client. The Sandifords met the teenager in Colorado, brought her back to California to live with them and paid her medical bills, counseling fees, living expenses and telephone bills. Three and a half weeks later they were in the delivery room for the birth of their daughter Kira.

While the Sandifords used an attorney and social workers to help with the adoption process, they’d arranged what is known as an independent (or private) adoption. That means that rather than using an adoption agency, they hired an adoption attorney to handle the legal paperwork. Of the estimated 30,000 infant adoptions that take place in the U.S. each year, at least half are independent adoptions. One advantage of this type of adoption is that you have more control over the search process if you do it yourself. But it can be tricky. Each state has its own rules governing independent adoptions, which are not legal in Connecticut, Delaware or Massachusetts.

In an independent adoption, you can ask an attorney to search for a birth mother if allowed by state law, or you can do the search and use the lawyer merely to screen prospective birth mothers you’ve found and to do the legal paperwork. By networking, mailing résumés to obstetricians and attorneys, running a classified advertisement for weeks in a variety of newspapers or even creating a home page on the internet, you can quickly spread the word that you’re looking. If you choose this approach, you’ll probably want to install a separate telephone line and answering machine to take responses. Expect to spend six months to more than a year in your search.

Independent adoptions can be risky. Although there are no reliable statistics, a significant number of the arrangements prospective adoptive parents make with birth mothers fall through, usually because the birth mother decides to parent her child. Until recently insurance was available to reimburse expenses in this case, but currently no insurance company offers this type of plan. So it’s best to work closely with a lawyer who knows how to screen birth mothers and minimize all sorts of risks, including the possibility that you might be conned by unscrupulous people seeking to separate you from your money. For a referral, contact the American Academy of Adoption Attorneys (202-832-2222; www.adoptionattorneys.org).

What it costs: The total cost of the Sandifords’ first adoption was $15,465. For their second independent adoption, their out-of-pocket expenses were just under $12,000. Because the Sandifords used the adoption grapevine rather than advertising to connect with birth mothers, their costs were relatively low. If you advertise extensively or hire a lawyer to search for you, or if the birth mother’s or child’s medical expenses run high, your total adoption costs can soar beyond $35,000.

Adopting Internationally

International adoption is on the rise. In 1999 Americans adopted more than 16,000 babies, toddlers and older children from other countries. It’s increasingly common in playgrounds across the country to see parents with a Chinese, Russian or Guatemalan toddler in tow. Parents often choose this route because "they do not have to compete for a child, the wait is often shorter, the fees lower, and the outcome more certain than in domestic adoption," according to one parent who chose international adoption after becoming daunted by the process of identifying a birth mother in the U.S. Many parents also relish the opportunity to incorporate another culture into their family.

Agencies throughout the United States handle most intercountry placements. A U.S. agency may have adoption programs in several different countries; each of these programs will have different requirements established by the placing countries. As you learn about agency programs, you are likely to discover that you are eligible for some but not others. If you’re single or an older couple, be prepared for fewer options.

The placing organization abroad may be a national department of social services, an orphanage, a private foundation or other social welfare organization. Depending on the laws of the country, judges, doctors, lawyers, social workers and other helping professionals may be involved in arranging an international adoption. Choosing experienced and responsible professionals is important: adoption scams can occur overseas as well as at home.

The paperwork for an international adoption can be daunting, because you are satisfying the requirements of a foreign government as well as the U.S. federal government. And while most international adoptions go smoothly, changes in government policy abroad can delay or derail a placement. It helps to select an agency that works in several countries acceptable to you in case your first choice becomes unavailable.

The majority of children adopted abroad are healthy, but there are risks. Children may be undernourished, have an infectious disease that requires treatment on arrival or show developmental delays in comparison with American infants their age. These are not necessarily long-term problems, but parents adopting abroad will want to consult a pediatrician familiar with international adoption before accepting a referral and for screening on arrival at home. For a list of medical professionals with experience evaluating children adopted internationally, see the website of Families with Children from China (www.fwcc.org/doclist.htm).

What it costs: Because international adoption involves costs in two countries and may require you to spend some time abroad, it can be as expensive as domestic adoption. The National Adoption Information Clearinghouse gives a range of $10,000 to more than $30,000, depending mostly on the requirements of the foreign country.

Adopting a Waiting Child

Over half of the more than 75,000 U.S. children adopted last year were beyond infancy or deemed "special needs" because of physical, mental or behavioral disabilities, their age or their minority group status. Estimates put the number of children in foster care who are eligible for adoption as high as 117,000. States and agencies caring for these "waiting children" consider all of them adoptable and will feature them in picture books you can find at public libraries or subscribe to by mail. Another source is the Faces of Adoption computerized photo-listing book (www.adopt.org), which shows hundreds of waiting children throughout the United States. To adopt an older child from the foster care system, you must go through an agency.

What it costs: Because the aim of special-needs adoption is to find permanent families for waiting children, the costs are minimal and incentives are plentiful. Agencies will lower or waive their usual fees, and the government will reimburse you for your adoption expenses, including travel and legal bills. Plan on initial out-of-pocket expenses of $1,500 to $3,500, but expect to recoup your costs through a federal reimbursement plan or the adoption tax credit. In fact, says Jeanette Wiedemeier Bower, project manager at the North American Council on Adoptable Children (NACAC), an advocacy and parents’ support organization in St. Paul, Minnesota, "Adopting a special-needs child is often completely free."

The federal government mandates that states provide nontaxable adoption subsidies for special-needs children who meet federal and state guidelines. These monthly payments, typically until the child is 18, ensure that a prospective parent is not deterred from adoption because of the expenses of caring for a child with special needs and that the child receives required services. Coverage includes medical assistance, psychological counseling, day care and tutoring, for example. The average monetary subsidy is $250 to $300 monthly, says Joe Kroll of NACAC, but it can reach $1,500 in some rare cases.

Get as much information as you can about the special-needs child you are considering, including medical records and family history, before the placement. And be sure to inquire about all available subsidies. Get a written subsidy agreement that provides for financial aid, medical coverage, social services and the reimbursement of nonrecurring adoption costs. If you fail to specify all possible expenses and eventualities, don’t panic. "Any time you have one benefit," says Wiedemeier Bower, "you can go back and negotiate others if the needs change." As with all aspects of adoption, this is a case where it pays to know the rules in advance.

How to Adopt Smart

Once you’ve decided that adoption is the right choice for your family, learn everything you can about all the alternatives. A good one-stop place to start your research is the National Adoption Information Clearinghouse in Washington, D.C. (888-251-0075; www.calib.com/naic/). It will send out free fact sheets, lists of agencies in up to five states and reading lists to educate you about the adoption process.

Of the roughly 30,000 adoptions of healthy infants in the U.S. each year, most involve expenses of $10,000 to $25,000; some, especially those that require lengthy advertising to solicit birth parents, cost twice that much. International adoption usually totals $25,000 or less (including travel), but on occasion it too can exceed $30,000. While some adoption expenses are unavoidable, there are steps you can take to realize your dream of adopting a child without breaking the bank.

The home study: Whether you use an agency or a private lawyer to adopt in the U.S. or another country, one of the most important documents in your file, and one you are legally required to have, is a "home study." The end result of the study, which includes counseling, is a written evaluation of you and your family by a state-licensed social worker. If you are adopting through an agency, the agency worker assigned to your case will generally perform the home study. If you are using a private lawyer, you can still use an agency to do your home study, or you may be able to contract with an independent state-licensed social worker. Either way, this report typically costs $750 to $1,500, depending on where you live.

Sometimes the home study fee is rolled into a larger agency fee that prospective adoptive parents pay. That was the case with Deboriah Pogue, a single adoptive mother in White Plains, N.Y. Her bill of $4,000 from her adoption agency, for example, covered the home study, counseling for the birth parents, medical expenses for the birth mother, foster care for the child between birth and placement, and postplacement follow-up and counseling. It is important to clarify exactly what is covered by an adoption agency’s fee before you make your selection. If you work with a private attorney, be aware that an attorney’s charges usually do not cover the cost of the home study or the birth mother’s prenatal and maternity care.

Birth mother’s expenses: Whether you adopt through an agency or independently, if you want to adopt an infant in the United States you will probably need to pay at least some of the birth mother’s expenses. Decide which birth parent expenses you are willing to underwrite, and know what is legal in your state. In most cases, if the birth mother lacks medical coverage and is ineligible for Medicaid, you will probably pick up prenatal and hospital delivery charges. As a benchmark, most adoption experts say to figure on spending at least $7,500 on these expenses. Explore whether a doctor or hospital can be paid in installments or will extend you a discount for services. Some states will also permit you to pay "maternity-related" expenses, such as rent, food, utilities, counseling and even lost income for the birth mother for time off work. Others, like Pennsylvania, forbid reimbursing the birth mother for anything but her medical costs.

While it’s tempting to draw up a contract binding a birth mother to you, it’s not legally enforceable; no state allows a birth parent to terminate parental rights before the birth of the child. You can, however, set up escrow accounts through your attorney, pay expenses out over time and get an itemization of all costs. (Your local court is likely to require detailed records of your adoption expenses at the time of finalization.)

Attorney’s fees: If you adopt independently, budget $5,000 to $7,000 for your attorney and $2,000 for legal representation for the birth parents. Even if you don’t use an attorney to help you locate a birth mother and arrange your adoption, you will almost surely employ a lawyer to help you complete, or "finalize," your child’s adoption in court. Fees vary widely by locale but start around $1,000. To keep a lid on expenses, find an attorney who’s flexible and sensitive to your need to save money. Don’t use the attorney for routine hand-holding, since time spent talking on the telephone is typically billed. And steer clear of intermediaries who ask you to pay a "finder’s fee," charging you just to look for a child and providing no other services, or who require you to pay to place your name on a waiting list.

Agency fees: In choosing an agency for domestic or international adoption, forget the old notion that you get what you pay for. Just because one agency charges more doesn’t mean it provides better service. Ask the agencies for a breakdown of their fees, what they cover and what expenses are extra. It might turn out that the agency charges a low fee because most services, such as the birth mother’s medical expenses and counseling, are à la carte. Some agencies use a sliding scale, basing fees in part on the client’s income. Your best bet is to call an adoptive parents' support group and ask friends who’ve adopted for recommendations.

Other expenses: In addition to the agency’s or attorney’s fees, telephone bills as well as lodging, meal and travel costs can add as much as $5,000 to $10,000 to your overall adoption budget. And don’t forget to check your medical insurance policy for your prospective child’s coverage. Federal law requires most employer-sponsored group policies to pay medical expenses, including those for preexisting conditions, from the time you assume financial responsibility for the child. Make sure you’re covered, and if you’re not, consider purchasing a short-term policy until your regular policy kicks in when the adoption becomes final.

Perhaps most important: Tamp down those feelings of desperation. Adoptions happen all the time. You shouldn’t be hearing that this is a once-in-a-lifetime situation or that you must make a snap decision or forgo the baby. "Be willing to walk away if it’s not going right," says Mark McDermott, a Washington, D.C., adoption attorney. "People who are hoping to adopt are so anxious to do so that they are vulnerable to scams or high prices."

Tax credits, adoption benefits and other financial aid: If all these expenses sound overwhelming, keep in mind that you may have more resources available than you realize. Thanks to a law passed in 1996, up to $5,000 of unreimbursed adoption-related expenses ($6,000 if the child has special physical, emotional, mental or behavioral needs) can be claimed as a tax credit by households with a modified adjusted gross income of up to $115,000 a year. Currently, this tax credit ends after the tax year 2001. Legislation is pending to expand and extend this benefit, but it is too soon to know what the outcome will be.

Some employers—including 65 percent of Fortune 500 companies—provide adoption benefits, such as counseling, leave for adoptive mothers and fathers (it’s often different from that for biological parents) and reimbursement for expenses. The typical benefit tops out at $4,000, says Suzanne Camp of the National Adoption Center in Philadelphia (800-TO-ADOPT; www.adopt.org). But some companies are far more generous. Eli Lilly and MBNA America reimburse costs up to $10,000.

Other resources include cash advances from credit cards, second mortgages, home equity loans and special adoption loans. You can apply for such loans from MBNA America (800-626-2760) and First Union Bank (888-314-KIDS). You might also tap friends and relatives. You can often borrow from a life insurance policy, 401(k) or pension plan. Perhaps you can take a second job until your child comes or sign up with a birth mother who already has medical insurance. Bottom line: Leave no stone unturned.

Lois Gilman is the web files editor at eCompany Now magazine in San Francisco and the author of The Adoption Resource Book (Harper Perennial, 1998). Susan Freivalds is the executive director of the Adoption Education Institute (sfreivalds@adoptioneducation.org). This article is adapted from "How to Realize the Joy of Adopting a Child" (Money magazine, Nov. 1997).