Market Research Shows Massive Hike in Cost of Raising a Child

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24th January 2013 16:07 - Financial Services

An annual survey by insurer LV=  has discovered that the cost of raising a child to the age of 21 has now reached as much as £222,000. This figure represents over a £4,000 increase on last year and £82,000 more than 10 years ago (when the first annual Cost of a Child Report was published).

British parents are now paying 58% more than a decade ago, with education and childcare remaining the biggest costs.

The current cost of education (including uniforms, after-school clubs and university costs but not private school fees) has seen a massive 124% increase compared to a decade ago - from £32,593 to the current £72,832 per child. In addition, childcare costs have risen by 61% from £39,613 in 2003 to £63,738.

When it comes to food, the survey found that from birth to the age of 21, parents spend an average of £19,270 on food for each child plus £16,195 on holidays.

Parents also admitted they feel under pressure to keep up with the latest technology, even for kids as young as three years old. The average yearly amount they reported spending on gadgets for their child is £302.

A total of 76% of the parents who took part in this latest study claimed that they’ve been forced to make cutbacks to meet the financial demands of raising their kids. Of the three quarters reporting budget tightening to cope, more than a quarter (27%) are cutting back on essentials such as food, 68% are buying less expensive goods and 56% are needing to use vouchers and discount codes.

Demographically, the priciest areas to raise children over the past ten years remain London (£239,123), the South East (£237,233) and the East of England (£233,363). Families in the South West have seen the most significant hike in costs – they now paying on average £100,077 more per child than they were 10 years ago.

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