The report from Liverpool Victoria, revealed that it now costs £218,000 to raise a child until they are 21, compared to just £140,000 when the annual study first began in 2003.
According to the results of the survey, the factors making the biggest demands from the household budget were childcare, food and education.
The LV report, The Cost of a Child, discovered that to raise a child now costs parents £28.44 every day, adding up to a whopping £865 each month or £10,382 a year. And the authors of the report warned that parents were unlikely to see any letup in the financial pressure in the near future.
The study was first commissioned back in 2003, when the total cost of raising a child from birth to age 21 was pegged at £140,000. The current figure of £218,000 represents a 55% increase on the original sum – a huge rise in just nine years. The sum has risen by 3.3% since last year, when it was calculated as £211,113.
Family budgets have been under increasing pressure as the cost of living has steadily climbed, whilst many have faced unemployment, wage freezes or a drop in income due to a lack of work. Savers have also seen their returns drop to practically nothing, slowly eroding the real value of the money they have stashed away.
Education was surprisingly the biggest increase in expenditure, with costs climbing by 5.1% over the last twelve months. However, tuition fees have helped to push the figure higher, with after school clubs, uniforms and other educational costs all taking their toll on overstretched pockets. The total amount spent on education related expenses now stands at £71,780.
Childcare is the second biggest expense to burn a hole in the budget, with babysitting and nursery fees up by 2.7%, reaching £62,099. In third place was food, one of the primary areas being hit by inflation, increasing by 4% to total £18,667.
It was also revealed that parents hand over at least £4,000 in pocket money to their offspring.
LV researchers also discovered that the financial pressure does not ease as children get older, with the most expensive years between the ages of 18 and 21, with an average of £17,459 shelled out. The figure represents a 5% increase on the previous year, but 15% of parents said that their youngsters will have to find the cash to share the financial burden of attending university.
With the pressure on household finances, expenditure on leisure and hobbies was inevitably found to have reduced, as well as the amount spent on toys. Hobbies and toys dropped by the most, a fall of 4.6%, with the total spend coming to £9,248. Recreation and leisure activities saw a reduction of 0.6%, with £7,303 paid out.
The survey also revealed a national variation in costs, with the south east and London in particular the priciest place to raise a child, whilst those in the north east spent the least. The costs in the capital to raise a child to age 21 came to nearly £240,000, whilst those in the north east of England spent approximately £202,000.
More than three out of four families asked admitted they were having to find ways to make savings, with two in three saying they were cutting back on their shopping bill by either switching to budget range items in supermarkets or finding lower cost alternatives. Around one in three said they had started purchasing second hand goods, whilst another third said they were drumming up some more cash by selling some of their unwanted items.