Parents unprepared for the cost of kids

With the Royal baby expected this month, new research from Santander Insurance reveals that the average parent believes they spend £537 per month raising their children. The findings highlight that many parents are struggling to cope with the financial strain of raising children, with over half (52 per cent) of parents saying the cost of raising a child has increased significantly in recent years and 41 per cent claiming it's almost impossible to be financially prepared for raising a child nowadays.
 
One in 20 parents (5 per cent) even say they wouldn't have had a child if they had known how much it would cost to raise it.
 
Despite the high cost of raising children, Santander is warning that one in four (26 per cent) of parents  of children under 16 don't have any financial protection in place for their offspring in the event of serious illness or death, and under half (45 per cent) have a life insurance policy in place.
 
One in four parents (27 per cent) say the cost of raising a child has turned out to be significantly more than expected. The most significant cost is child care, with parents who use it spending an average of £187 per month on it. Parents spend an average of £129 per month feeding their children, and £60 per month transporting them. Education-related expenses such as school trips cost parents an average of £60 per month, and £52 per month is spent on clothing.
 
With parents struggling to afford the cost of their kids, 48 per cent say they sometimes accept ‘hand-me-downs' from friends and family for their child and 37 per cent buy second hand items e.g. from school shops or charity shops. One in five parents (21 per cent) say they dip into their savings to cover the cost of items for their offspring and one in 10 (11 per cent) use money given by or borrowed from other family members. Four per cent have taken out a personal loan to help cover the costs of raising their children.
 
Richard Al-Dabbagh, Santander Insurance, said: "Parents can spend hundreds of pounds every month on their children and it's easy to forget the level of reliance children have on them financially as well as emotionally. Understandably, death or illness is not a subject that many people want to think about, but it's worrying that so few parents have a financial contingency in place to support their children if anything should happen to them.  Parents need to feel reassured that their loved ones will be OK if something happens to one or both of them."
 
Costs of raising children

Expense - Average monthly expenditure by parents on this cost for their children (for those who do spend money on this)

Child care £186.63
Food and drink £129.18
Child maintenance payments £117.97
Transportation £59.58
Education expenses e.g. school trips £59.55
Leisure and entertainment £56.24
Sports and hobbies £55.00
Clothes £51.82
Toys and gifts £41.86
Health and baby products £40.04
Mobile phone bills / credit £38.24