Children cost £90,000 before high school

03 September 2012

The Halifax Cost of Children review looks at some of the typical costs parents would incur in bringing up their child during the year. These costs include those resulting from childminding services, schooling (not including private schools), holidays, as well as the normal day to day items such as food, clothing, pocket money and personal care. This review concentrates on children up to pre-secondary school age (11). The data sources used in this review are from the British Market Research Bureau, Halifax, the ONS and LV (Liverpool Victoria). The period covered is 2007 to 2011, all figures are annual averages.

 Annual cost of a child rises to over £8,000

The cost of raising a pre-secondary school child now stands at £91,377 according to latest research from Halifax.

The annual average cost of raising a child up to the age of 11 in Britain has increased by £1,085 in the last five years, rising 15% from £7,222 in 2007 to £8,307 in 2011.

Over the same period inflation, as measured by the Retail Price Index, rose by 18% and in 2011, parents spent just under a fifth (18%) of their average household income, on bringing up their child.

Cost of schooling increases ahead of inflation

The largest increase in expenditure incurred by parents is the cost of schooling.  This includes the amounts spent on uniforms, class materials, school trips and lunches, which are estimated to have increased by 24% from £684 a year in 2007 to £849 in 2012

The second largest increase has been the costs of nursery and childminding3, which have grown by 22% to £3,346 in 2011. This item typically accounts for 40% of the total annual expenditure incurred by parents when raising their offspring. Nursery/childminding and the cost of schooling together account for half of the total annual expenditure.

But spending on food and holidays falls in real terms

Parents spent £889 feeding their children in 2011; an increase of 14% from £780 in 2007. Food accounts for 11% of the total cost annual of raising a child. During the same five year period, the value of spending on children’s holidays rose by 16% from £636 in 2007 to £740 in 2011.

Spending on children’s clothing falls over the last five years

The amount spent on children’s clothing by their parents has fallen by 15% since 2007 – from £602 to £513 in 2011. During this period, heavy discounting took place amongst retailers as a result of the economic downturn.

Spending on children slows as economy slows

Since the UK's weak recovery from the 2008/9 recession, annual growth in spending by parents on their children slowed has to 3% in 2011.  This represented a fall in real terms as inflation grew by 5.2% between 2010 and 2011.

Martin Ellis, economist at Halifax commented:
“The cost of raising a child under the age of 11 has increased by 15% over the past five years.  This has added to the already considerable strain on household finances during the economic downturn.

"Child care costs and education account for half, or £4,200, of the total annual cost of raising a child. This is a substantial sum for most households, so it pays to ensure sound financial planning when you are looking to start a family.”

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