Have you ever wondered what would happen to your family's…
They say you can’t put a price on family, but just how much does it cost to raise a child?
According to the Child Poverty Action Group, in 2022, the total cost of raising a child to the age of 18 stood at £157,562 for a couple and £208,735 for a lone parent.
Since 2012, Child Poverty Action Group has released the 'Cost of a child' report. The 2022 report shows that childcare costs tend to be the biggest expense for working parents.
In this article, we’ll take you through how much it costs to raise a child in the UK and outline some of the most essential costs.
Protect your loved ones
At Reassured, we can help you to arrange a life insurance policy to help cover all the essential costs of raising a child if you were no longer around.
Our award-winning team can talk you through your options to help you make a fully informed decision on what policy type is best for you and your family.
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In 2022, the basic cost of raising a child until the age of 18 was £69,621 for a couple and £113,102 for a single-parent family.
However, that’s just the basic cost. When additional costs, such as housing and childcare, are added we get the total cost of £157,562 for a couple and £208,735 for a lone parent.
But exactly what’s included in the cost of raising a child?
The cost of raising a child to the age of 18 can be broken down into a list of smaller costs, these include (but are not limited to):
With all these costs in mind it’s important to consider how your family would cope if you were no longer around.
By securing a life insurance policy, you could have your sum assured match up with all the combined costs of raising your family, to help ensure there would be minimal financial disruption if you were to pass away.
For peace of mind, why not discuss your options with a member of our friendly team?
The cost of childcare has been increasing each year. For working parents it’s an essential cost that now makes up more than half of the overall cost of raising a child.
Various factors can influence the price you’ll pay for childcare, such as:
The table below shows the average cost of both part-time and full-time childcare in 2023:
|Part-time||£7,729 a year||£6,547 a year||£250 - £400 a week|
|Full-time||£14,836 a year||£12,854 a year||£400 - £650 a week|
Some parents may also require additional forms of childcare.
For example, parents who work in the evening and may be unable to make school pick up times may require after school clubs (which roughly cost £67.42 per week).
As well as this, parents who are required to work during school holidays may need holiday childcare (which currently stands at £138 per week).
When you add all of these costs up it’s not surprising that childcare takes up the majority of funds when raising a child.
This highlights the need for having adequate life insurance cover in place.
If the worst were to happen, a life insurance policy could help to cover necessary childcare costs.
Our friendly team have been helping families for over 10 years, so why not get in touch to find out about your options?
It’s estimated that the most expensive years of raising a child are the first few years.
It can be possible to spend thousands of pounds in just the first few months, buying essentials for the baby and their nursery.
First time mums and dads will need to splash out on some large expenses, including:
As well as smaller essentials, such as:
You can help to save money on these costs by purchasing some items second hand or by using hand-me-downs from family and friends.
Those who have already had one child are likely to be able to re-use certain items - allowing them to save money.
Due to having the NHS in the UK, there aren’t many costs involved with having a baby.
Most antenatal, birth and postnatal care can be done free of charge.
However, the above section details other costs that may be associated with having a baby that you’ll need to consider and factor into your budget.
You may also need to pay for any private scans or appointments that are done outside of the NHS.
What financial benefits can I get for having a baby?
There are certain benefits you can claim from the Government to help with the cost of raising a child. These include:
Child benefit is a payment made to parents which can help towards family budgeting.
You can claim child benefit for each of your children, regardless of whether you’re in work or not.
Each child must be under 16 or under 20 if they’re in full-time education.
Payments are tax-free as long as neither parent/guardian earns over £50,000 a year.
You’re still able to receive this benefit if your salary is over £50,000 but you’ll be required to pay some back in your income tax.
As of 2023, claimants are eligible to receive £24 a week for their first child and £15.90 a week for each additional child.
Child tax credit
Child Tax Credit is a type of benefit used to help low-income households with the cost of raising a child.
However, it’s one of the six benefits being replaced by Universal Credit. This means that new applicants will need to apply for the child element of Universal Credit, rather than Child Tax Credit.
This can allow you to claim back up to 85% of eligible childcare costs up to a maximum of £646.35 for one child and £1,108.04 for two or more children.
If you’re already claiming Child Tax Credit, you’ll need to change to Universal credit before March 2023.
If you or your partner are receiving the Severe Disability Premium you can still make a new claim for Child Tax Credit.
Tax-Free Childcare is a government scheme that will help working parents with the cost of childcare.
It can help to pay for registered childminders, nurseries and nannies, as well as registered afterschool clubs, playschemes and holiday schemes, registered schools and home care workers working for a registered home care agency.
To be eligible, parents must be working and have children under 12 (or under 17 if your child has a disability), earn at least £139.52 per week, have no more than £100,000 adjusted net income (per year, per parent), be employed or self-employed.
You can apply online by setting up a childcare account on gov.co.uk.
For each £8 you pay into your childcare account, the government will pay in £2 up to a maximum of £2,000 per child or £4,000 per disabled child each year.
You can’t use Tax-Free Childcare at the same time as Universal Credit.
Having a baby is a life changing event and it’s one that you’ll need to plan carefully for.
It’s often an occasion that sparks the need to take out life insurance.
As well as getting your finances in order for when the baby arrives, it’s also important to plan financially for when you’re no longer around.
If you were to pass away could your partner afford to cover all the costs of raising your child as a one parent household?
By taking out a life insurance policy you can help to secure the financial future of your loved ones and take care of the associated costs of raising a child.
Why not get in touch with our award-winning team? We can help you through the whole process, from talking you through your options to helping with the application.
In 2020, there were 19.4 million families in the UK - an increase of just over 1 million families (5.7%) in the decade since 2012.
In addition to this, data from Statista shows that the most common family consists of 2 children.
With this in mind, it’s likely that the cost of raising a family in the UK would be even greater than the costs shown in this article - which show the cost of raising one child.
This makes protecting the financial future of your loved ones even more important.
Get in touch to discuss our family life insurance policy options.
Hopefully this article has given you an insight as to how much it costs to raise a child in the UK.
You can help protect the financial future of your loved ones with a life insurance policy.
A pay out can help to cover the associated costs of raising a child if you were to pass away.
Our award-winning team has been helping families for over 14 years and can guide you through the entire application.
The best part is cover arranged through us starts from 20p-a-day and our quotes are fee-free.
Why not get in touch to compare your no-obligation quotes today?
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