Cost of raising a child

Cost of raising a child

People understand children can be costly to raise and educate but many people underestimate how much money this will actually take.

According to LV='s report, Cost of a Child, the average UK household will pay £231,843 to raise a child from birth to when they leave further education at 21. 

This was an increase of more than £2,500 in the past year - and is almost as much as the average cost of a house, which according to the Office for National Statistics is now at £232,885 for England.

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When broken down, LV='s Cost of a Child survey showed raising a child now took up 38 per cent of the average UK household's net income, with the biggest yearly increase in costs - 4.3 per cent - coming from childcare.

Fellow life and pensions provider Aviva also produced research on how much it would cost to raise a child. 

Aviva's Cost of Youth report found parents could spend almost £29,000 funding the teenage years alone - from 13 to 19 - which is more than the average annual salary in the UK.

This, according to Aviva, equates to more than £4,000 for every teenage year.

Alistair McQueen, senior policy manager of pensions and investments for Aviva comments: "I doubt many people are fully aware of just how much they may spend raising a child.

"Having a family is an ongoing cost which fluctuates. The thousands of nappies a child will go through in the first few years cost a lot, but as soon as that phase is over, a new cost will come along, such as nursery fees or more sophisticated toys."

In order to meet these costs, some clever - and early - investment plans need to be put in place. 

A recent survey from investment platform suggested: 

  • New parents should invest up to £260.55 a month to cover the cost of sending a baby to university for a three-year course in 18 years.
  • Reaching the £57,441.79 needed in five years’ time would require much higher contributions of up to £888.29 a month.


School and university fees account for the bulk of the costs of raising a child. 

Robin Baker, adviser for Eden School Fees Planning, says: "Parents are generally unaware of the cost of education."

He points to the latest Independent Schools Council (ISC) census which reveals school fees have increased by 130 per cent since 2000 and the most expensive schools now cost around £35,000 a year.

"While it is never too late for a private school fees plan, it is always better to start as soon as possible. The longer you have to save the cheaper it will be", Mr Baker adds.

Ian Naismith, retirement expert at Scottish Widows, highlighted a 2015 report from broker Killik & Co on the cost of private education, which found schooling from primary age to A-levels totals £286,000 for a day place and £468,000 for a boarder.

Tim Healy, executive director and education sector expert for Quilter Cheviot, says: "Putting your children through independent schooling does not always come easy, financially speaking.