Cost of raising a child reaches £227,000
According to the annual ‘Cost of a Child’ study from LV=, a child’s first year has risen in cost by 50% to £11,025 since the first report in 2003.
The overall cost of raising a child has increased by 62% since 2003.
In the past 12 months, it has increased by 5% largely due to the cost of childcare for children aged less than a year rising by 7% in 2013 to £6,623.
In total, parents now spend £66,113 on childcare – an overall increase of 4%.
The report found that parents are now estimated to be spending on average 28% of their annual income on bringing up their child each year – up from 23% in 2004.
Education and childcare remain the biggest costs, with 71% of parents reporting that they have been forced to make cuts to meet the financial demands of raising their family.
Alongside the escalating costs of raising children in general, the impact on families of cuts to child benefit has been acutely felt.
Changes to child benefit this January saw many families lose some or all of their child benefit.
The report found that due to the cuts, one in four mums have returned to work earlier than they wanted to and close to one in five have had to work more hours than they intended to.
One in ten parents have chosen to have a smaller family and one in five are delaying having an additional child because they now can’t afford it.
Unsurprisingly, single parents have been hit the hardest from the cuts and rising costs, as they fork out more than half (54%) of their annual income.
Mark Jones, head of protection at LV= said, “Having children has never been more expensive. The costs associated with raising a family are set to remain a pressure point for families across the UK but seeing the cost of raising a child in its entirety can help people think about how to secure their family’s financial future should anything unexpected happen.”
Across the UK, London (£244,977), the South East (£243,177) and Northern Ireland (£237,959) are the three most expensive places to raise a family.