The study examines the economics of different calf rearing systems and considers effects of suckling and milk feeding on production, health and welfare of dairy cows and growth, milk and feed use, health and welfare of calves. The economics of (i) no suckling, (ii) suckling for 3 days, (iii) suckling for 7 weeks, all assuming milk or milk replacer fed until weaning at 13 weeks, was compared with (iv) suckling for 13 weeks and no milk feeding. A linear programming (LP) model, maximizing profit on a dual purpose dairy-beef farm in lowland eastern Norway, was used for the comparison. Details on calf rearing methods, labor, weaning age, intake of milk, and solid feed were gathered for a sample of organic farms and grouped according to the length of the suckling period. The data were coupled with the National Dairy Herd Recording System (NDHRS) using cross-sectional data for the years 2008–2013. The results of the model study showed that suckling up to at least 7 weeks and longer than on most farms in the survey, had a positive influence on the farm economics. This was due to the positive influence on calf growth and health as well as lowered costs. Consequently, dual purpose dairy-beef farmers should be careful to sacrifice calf suckling and restrict calf milk feeding. Long suckling until weaning at 13 weeks was, however, unprofitable.