How much does your child cost you?

There is no doubt having children is an expensive business but do you really know how much your children cost you?

LV recently did some research around the cost of raising children and in particular the part that child care costs play in that. Here are some of their key findings:

  • Soaring child care fees sees cost of raising a child hit £229,251
  • Cost of raising a child has increased at almost twice the rate of annual inflation over the last 12 years
  • Parents now spend nearly a third (29%) of their gross annual household income on raising a child
  • Childcare represents largest annual rise over the last 12 months, costing parents £67,586 on average

The cost of raising a child in the UK from birth until the age of 21 has climbed to £229,251, an increase of 63% since 2003.

According to the annual ‘Cost of a Child’ report from protection specialist LV=, costs associated with raising children have increased at almost twice the rate of annual inflation over the last 12 years.

Parents are spending less on food, hobbies and toys for their children, but these savings are being eclipsed by huge increases in the cost of education and childcare. The report reveals that these two areas alone now account for 62% (£141,905) of all the costs involved in raising a child to the age of 21.

Childcare (nurseries, babysitting and after-school care) is one of the biggest drains on family finances, at £67,586 on average. The cost of childcare varies across the UK with childcare costs in London (£81,276) 20% higher than the national average. The South East (£75,902) and the West Midlands (£74,598) follow, while parents in Yorkshire & Humberside pay the least for childcare over the course of their child’s life (£61,397).

The bulk of this cost (£42,389) is incurred in the first four years of a child’s life [3]. Indeed parents with young children (aged under three) can expect to fork out a quarter (27%) of their household income to meet the cost of nursery fees.

Parents in the North East face paying 31% of their household income on nurseries for children under the age of three, while Wales and Yorkshire come a close second and third (both 30%). Although London has the highest nursery charges in the country, higher salaries means fees account for a smaller percentage (25%) of these families’ household income.

Education costs (school uniforms, books, stationary, trips, lunch and university fees) are the biggest expense for parents. Parents face an education bill for £74,319 on average for non-fee paying schools – a sum that has climbed 128% since LV= commissioned the first report in 2003, with parents with children at fee paying day schools paying an additional £129,030.
Rising costs aren’t just hitting parents’ pockets, but impacting on the size of families. Recent figures from ONS predict that by the year 2022, half of all UK families will have just one child. Echoing this, the Cost of a Child report reveals that one in 10 (9%) parents admit that they are postponing having any more children due to financial concerns.

Faced with soaring costs, four in ten parents (44%) have made reductions to their routine spending over the past year in order to make ends meet. Parents are making cuts on essential spending such as clothes (39%) and spending on leisure and recreational activities has also fallen by 27%.

Simultaneously, parents are adopting a more thrifty approach when it comes to shopping. Almost two thirds (63%) admit to buying lower cost items in the last year, while almost half (49%) regularly use vouchers and discount codes.

Recent cuts to Child Benefit mean that a family’s household earned income now needs to go further than before. Yet, despite this, just a third (31%) of households have thought about what they would do if they lost their income due to accident or illness. As just one in five (21%) parents have an insurance policy that would cover their income or provide them with a lump sum if they were unable to work for a prolonged period of time, many families could find themselves in financial difficulty if they suddenly lost their regular wage.

Myles Rix, Managing Director of Protection at LV= said , ” Having children has never been more expensive and it is important that parents take steps to secure their families financial future. We urge parents to ensure that their family has a valuable safety net such as income protection in place. Costs such as childcare and education are continuing to rise and a significant part of a family’s income is spent on children. If the unexpected were to happen and either parent became unable to work, income protection insurance would provide a family with financial security when they need it most.”

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This is a frightening read for both those with children already and those contemplating taking the leap towards parenthood.

LV have a cost calculator which can help you work out what your children are going to cost you. According to this,my children will cost me £728,850 by the time they are 21!

There is a really interesting infographic here  which is worth a look!

Given the huge cost in raising children it seems appropriate to look for general ways you can save money. I have recently featured a range ‘Money Saving Tips For Families’ on the blog and there will be more in this series to follow.

As far as children are concerned why not consider some of the following:

  • Take part in consumer research panels like Shop and Scan and convert your points to vouchers.You can save them up to buy birthday and Christmas gifts for the children.
  • Use the points on your credit card for household items, perhaps kitting out a child’s bedroom, or again, convert to vouchers for gifts etc
  • Start a savings account or trust fund to help save towards the cost of university – if family members don’t know what to buy children, ask for a contribution to an account or perhaps invest in premium bonds
  • Sell items you no longer need on ebay to help towards the cost of purchasing other items
  • Don’t buy to excess – no small child requires 20 pairs of shoes!
  • Buy some second hand things – of course it is lovely to have brand new everything but it is not always necessary. One example of this is that despite having lots of lovely toys one of my sons has had great pleasure out of a VTech toy (which looked brand new) that his brother purchased for him from his school fair for £1 !


  1. Wow that is a lot of money! Just did the test and apparently my children are going to cost me £321,079!!! Thank you for sharing this really interesting post on #ThriftyThursday

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