Raising a family can be expensive but, as we all know, it’s worth every penny. But whether you’re considering starting your own enterprise, reducing your work hours, returning to work or becoming a stay at home mum, you need to be aware of all the financial implications.
Aviva – the insurance company – recently ran a detailed study into the costs of raising a family in the UK. The research revealed that, on average, parents will have spent over £35,000 on their child by the time they reach the age of five. That’s more than £7,000 a year which is just over a third of the average UK salary. © normalityrelief
The Essentials for Working Parents
Kitting your life out with all the essentials necessary to raise a child is costly. Cots, push chairs, changing tables and childcare do not come cheap. According to Aviva’s survey results, the average parent spends just over £3,000 a year on essential items before any toys, school equipment or family trips out can be paid for.
Location, Location, Location
Parents from all over the UK took part in the survey which revealed a real North-South divide when it came to the cost of raising children. Your location can make a huge difference to just how much money you’ll need to spend over the course of your son or daughters infancy.
London based parents have a raw deal paying nearly £10,000 annually on their under 5s – more than double what it costs to raise a child in Wales (£4,220). Towns and cities in the North West also had relatively low child costs, in comparison with the South, with an average spend of just over £4,500 annually.
Keeping up appearances
As well as location, social pressures and keeping up appearances seemed to play a huge role in driving up the cost of raising a child. One in five parents who took part in the survey, said they often spend money on certain items for their children just to feel as though they’re keeping up with other families in their area.
Thinking ahead for Working Parents
Past the age of 5 child costs can increase significantly with school trips, educational equipment, pocket money and, eventually, university fees all becoming necessary spends. But there are parents around the country looking to the future with over half (52%) saying they have opening savings accounts in their children’s names before they turn five. It was also revealed that an extremely forward-thinking 8% have already started saving for a house deposit for their child. Just under half (42%) had taken out life insurance and one in five had made a will.
Of course, the rewards of raising a child vastly outweigh the costs over the years. But better to be prepared and to plan ahead to make sure it’s a smooth a ride as possible and you can provide for your children. If you’d like to take a look at how much you’re spend on your child in comparison to the national average, take a look at Aviva’s child cost calculator.
Author: Daniel Rawlings, copywriter and executive reporting on new survey data by Aviva UK. Full details of the recent child costs survey can be found here.