Cost of raising a child hits £218,000
The cost of raising a child to the age of 21 rose by 3.3% to£218,024 over past year, according to a study by LV=.
The insurer’s annual Cost a Child report found cash-strapped British parents now have to fork out £10,382 a year, £865 a month or £28.44 a day on each of their children. The study also found that 76% of parents said they had been forced to make cutbacks to their budgets due to financial pressures over the past 12 months.
Although the rise in the cost or raising a child is considerably above the increase in average incomes over the last 12 months, it is below the Consumer Prices Index (CPI) of inflation, which fell last month to 4.2%. This year’s total is up from the £211,113 annual cost of child-rearing recorded in last year’s study.
The overall cost of bringing up a child has risen by 55% from £140,000 in 2003 when the insurance firm first published the report.
Education is the biggest drain on parents’ back accounts before their offspring reach 21. The amount mothers and fathers spend on putting a child through school, college and university rose by 5.1% to £71,780 this year. This figure is expected to rise sharply over the next 12 months after university tuition fees rise to up to £9,000 a year. The overall cost of educating a child has risen by 120% since 2003.
Childcare and babysitting accounted for the second largest proportion of spending, up 2.7% to £62,099, while feeding the average child to the age of 21 will now cost parents £18,667, up 4% from last year.
Clothing and holidays cost mums and dads £10,781 and £15,532 respectively. Over the course of his or her first 21 years, the average child can expect to receive more than £4,000 in pocket money, a rise of 23% since LV=’s first study.
The report found that 43% of parents have reduced the amount they regularly save in an effort make up for falling incomes and that only a third have life insurance in place.
The overall cost of raising a child breaks down as follows:
- 1st year – £10,261 – up 2.8%
- Years 1 to 4 – £56,562 (£14,140 a year) – up 2.5%
- Years 5 to 10 – £46,073 (£7,679 a year) – up 3.1%
- Years 11 to 17 – £52,753 (£7,536 a year) – up 2.7%
- Years 18 to 21 – £52,376 (£17,459 a year) – up 5%
Mark Jones, LV= head of protection, said: “Despite an uncertain UK economy forcing more pressure on the family budget, it’s clear that parents don’t begrudge the money they spend on their children, and would rather do without themselves than radically cut back on what they can provide for their children. From studying parent’s spending habits we’ve seen the cost of raising a child steadily increase since our first report in 2003, and this trend shows no sign of stopping.”
