How much does it cost to raise a child in the UK? 

Of all the choices people can make, the decision to start a family can be the most impactful, and far reaching – by Hannah Barnaby

 
I recall asking this very question before embarking on our own journey, when some parents told me ‘you really don’t want to know’; their experience was that it is ‘a lot’ but that ‘somehow you find a way’. 

However, with the cost of living leaving many families feeling the pinch and inflation in double digits, digital investment manager, Moneyfarm, decided to try to put a number on it. 

Its conclusion is not for the fainthearted as it suggested that the cost of raising a child from birth to age 18 in 2023, varied between £150,000 and £180,000 depending upon the area of the UK. 

It also highlighted the ways in which the cost of raising a child has changed, as the subscription economy has become a major part of our lives; entertainment and gaming are just two areas that have changed dramatically to become ‘must-haves’. 

Moneyfarm’s research included over 150 different metrics, ranging from babysitters to holidays to video games, and its findings that on average each child costs £10,000 a year for eighteen years may cause a sharp intake of breath. 

The cost of things like food, clothing, public transport, pocket money, and personal grooming mean that raising a child gets more expensive as they get older.  

Generally, raising a child gets more expensive as they get older; where you appear on the scale r  depends largely on your budget, and explained by the methodology.

Moneyfarm applied three spending estimates based on low, average and high budgets; ‘low’ is essentially the bare minimum required for a comfortable upbringing, without luxuries like private healthcare or expensive holidays.  

The ‘average’ figure reflects a reasonable spend, with some luxuries included, but other costs kept within reasonable parameters; ‘high’ is at the top end, including elements like expensive sports clubs, plenty of holidays and all the latest devices/consoles.  

Times they are a changing 

Moneyfarm found that calculating the cost of a child in 2023 is very different to how it might have been fifteen years ago; subscription services for entertainment and online gaming are now part of the majority of children’s needs.  

Whether Netflix or PlayStation Plus, such online activity is a must have; it estimated that, even between the ages of 6 and 8, the average child will have subscriptions of over £300 a year, rising to £400 between the ages of 15 and 18.  

Electronic devices are no longer considered luxuries; between the ages of 15 and 18 it found that £250 is spent on games consoles, £389 on smartphones and £529 spent on a computer/laptop. These are irregular areas of expenditure that can vary based on the quality of the product.  

Food is another area that becomes progressively more expensive as the child gets older; it rises in cost from an average of £675 per year from ages 0 to 3 to a not inconsiderable £2,489 per year on average for the period of 15 to 18. The rising cost of living could mean that this figure grows in the coming years.  
 
 

Methodology  

Not only did Moneyfarm separate spending into three budgetary categories, it also included ‘every cost imaginable’ in the average child’s upbringing, taken from reputable sources.  

An example of the granularity of the methodology is clothing, where prices can vary wildly; the investigation took a number of factors into consideration, like age, gender and whether the clothing is branded or not, and applied the regularity with which clothing has to be replaced for each age group.  

Subscriptions were divided between services deemed socially or educationally necessary, and those considered a luxury; eg online gaming and Netflix were deemed ‘standard’ subscriptions, along with things like Microsoft Office, whilst those considered a luxury included Sky Kids and Disney Plus.  

Preconception and costs associated with pregnancy, such as maternity clothing and a pram were also included; it found that this period costs a not-insignificant £1,500.  

Moneyfarm acknowledged that parenting very rarely stops at 18, with many subscriptions and trip costs to name but two, continuing well into a child’s 20s; it drew a line to give as accurate a figure as possible, but said the ongoing costs are something to consider.  

It suggested that those wishing to give a child the best possible start in life, might consider opening a JISA on their behalf, where you can save up to £9,000 every year tax-free, with a stocks and shares portfolio that’s designed to grow savings over the long term. 

It also advises prospective, and those new to parenting to ensure that they are fully apprised of the benefits that are available to those embarking on their journey, including Child Benefit, Child Tax Credit and Tax-free childcare.