Childcare costs alone are costing parents more than their mortgage, with some parents shelling out £2,000 a month on day-care bills.
The cost of childcare has risen faster than inflation for the tenth successive year, putting millions of parents out of pocket, into possible debt problems and some are even considering taking out debt management plans and IVAs as a result.
A study found that an average of 25 hours worth of nursery care (which is approximately three days) could cost between £102 and £126 for children under the age of two. For older children, the ratios of staff to children are larger, lowering the costs slightly to £97 for 25 hours.
Raising children over the course of a lifetime can also cost more than owning a home.According to the latest report from Aviva, ‘mumsand dads to-be’ spend an average of £1,375 on baby goods before the child is even born!
The cost of raising a child from nappies to university can take its toll on personal finances. Findings from the annual ‘Cost of a Child Report’ from LV, the leading insurer, found that bringing up a child until their 21st birthday could cost parents a staggering £218,000, which is more than £10,000 a year!
Considering this, it will probably come as no surprisethat raising children will be more expensive than paying off your mortgage, but is it really worth it?
Mortgage V Child
Positive: Unlike children, once you have paid off your mortgage, you will no longer need to continue making repayments as you will own the property.
Negative: Unfortunately, if you pay your mortgage off early, it can result in fines and additional fees as well asthe threat of repossession if you don’t keep up with payments.
Positive: You own them outright until the age of 18and they can be manageable for the first 15 years.
Negative: They will continue to turn to their parents as a source of income and funding throughout their lives. The ‘bank of mum and dad’ will have to make large, one-off payments towards housing deposits, weddings and cars……and then later grandchildren.