£218,000 now the estimated cost of raising a child

Friday, January 27, 2012

Parents who are already struggling with the huge expense of caring for their children have got some more bad news, as a recent survey has stated that the total cost of bringing up a child from birth to the age of 21 in the UK will now be £218,024, roughly the average price of a typical home in Britain.

The annual Cost of a Child report from leading life insurer LV says that the cost of bringing up the next generation has now risen by 3.3% over one year thanks to a combination of rising food, education and childcare costs.

Since the LV survey began in 2003, costs have now risen by 55%. The £218,024 figure roughly works out at £10,382 per year £865 a month or £28.44 each day. Education costs generally come to £71,780 over the 21 years and childcare comes to around £62,000.

The costs of education include university fees as well as things like school uniforms and these have risen substantially by 5% over the past year. Some costs have come down, with spending on hobbies and toys falling by 5% as more than three quarters of parents attempt to cut costs.

Life cover can cost about £5 a month for £100,000 of cover if you're in your 20s when you first take it out. You can cut the cost even further by opting for decreasing term cover, where the amount insured falls over the life of the policy usually in line with your mortgage debt.

Alternatively, family income benefit can be cheaper than traditional life cover - it pays an income rather than a lump sum for the remaining term of the policy.