Saturday, March 6, 2010
Category:
Personal Finance Tips
According to LV=, the results of their seventh annual survey have shown that the cost of raising a child to the age of 21 is likely to cost parents in excess of £201,000 – equivalent to £26 per day.
These costs were found to have increased by 4 percent since the previous survey in January 2009, with childcare and education amounting to the greatest expenses.
In fact, the survey revealed that a typical household where both parents are working could be faced with childcare costs up to £54,696 for each six month to 16 year old. This figure includes nursery fees, after school clubs and holiday clubs. Furthermore, the cost of education reportedly amounts to £52,881 throughout a child’s lifetime.
Findings have shown that 77 percent of parents have admitted to cutting back on family expenditure due to the ‘ongoing economic situation’, with this figure coming in lower than the 81 percent recorded last year. It would seem that 36 percent of parents are also cutting back on the amount of money that they regularly save. In addition, it was found that 19 percent of respondents have been forced to cancel or review their insurance products and income protection cover in order to assist with budgeting for the family.
With regard to pocket money, LV= discovered that the sum that a child receives has increased by virtually 5 percent this year. The value now stands at £4,338, which reportedly marks a reduction from £5,469 in 2007. It has been highlighted that 13 percent of parents have actually been asked for less pocket money, which is thought to be a sign that ‘the need to maximise the family’s finances is being felt by more than just mum and dad’.
The survey has revealed that the cost of raising a child is highest during the ‘university years’ when parents could potentially be faced with annual costs of £13,677. However, findings also show that parents with toddlers between the one and four years of age could be looking at a cost of £13,014 per annum.
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Homeowners who have found themselves using credit and store cards to cover the cost of their families, could consider consolidating this with a secured loan. One of many finance options available, a secured loan for
consolidation could be used to tie up any existing debts such as credit cards and personal loans. What’s more, in taking this approach, borrowers could be left with lower monthly outgoings and more money each month, which could potentially be set aside in a savings account. However, if opting for a secured loan to consolidate debt, it should be remembered that consolidating your debt may increase the amount you pay back overall and extend the repayment periods of your debts.
