Having a child costs £210,000!

Parents: find out how to cut your costs.

The cost of raising a child until their 21st birthday has rocketed to £210,000 - that's 50% more than parents spent in 2003.

It now costs £10,040 a year or £836 a month to bring up a child, according to a report by insurer LV=.

What’s more, those costs are rising by 4.5% a year – so more quickly than the official rate of inflation, which is 3.7%.

Childcare is the biggest expenditure parents face followed by education, food and clothing.

How much parents spend

Here’s a table showing how much the average parent now spends to raise a child and how that money is spent:

The report also shows that children cost more the older they get, especially if they go to university, which costs parents £14,365 a year on average. The breakdown of parental spending by different years of a child's life is as follows:

• 1st year - £9,491
• Years 1 to 4 - £53,586 (£13,397 a year for these years)
• Years 5 to 10 - £56,856 (£9,476 a year)
• Years 11 to 17 - £47,820 (£6,831 a year)
• Years 18 to 21 - £43,094 (£14,365 a year)

Cut your costs

The report found that a third (35%) of parents are hopeful that their child will still go to university despite the increase in fees, and they expect to make cut-backs to be able to help their child with the cost.

But what cutbacks can parents make and are there any other ways to reduce the cost of raising a child?

1) Cut the cost of entertainment

Entertaining the kids can often be expensive – but it needn’t be if you harness the power of the internet.  Many sites, such as  creativekidsathome.com, Kidzpage.com, CBeebies and Activity Village, offer free resources which you can use to entertain your children at home without spending a penny.

Alternatively, sign up for children’s discounts at the cinema via Vue's Kids AM club and Odeon Kids, get them cooking with CBeebies’ Big Cook Little Cook or BBC Good Food or bag them free tickets to watch their favourite TV show via:

• BBC Tickets, 
• sroaudiences, 
• TVRecordings, 
• ClappersTickets,
• ApplauseStore, 
• HatTrick and 
• LostInTV.

Finally, if you're looking for other free (or ultra cheap) events, the aptly-named Free Events is a particularly handy website.

2) Cut your cost of living

Believe it or not, it is possible to cut your cost of living without cutting your standard of living – if you’re prepared to spend a few hours doing something very worthy but utterly boring.

I’m talking, of course, about shopping around for the best quotes on things like life insurance, home insurance, car insurance, travel insurance, energy tariffs, credit cards and – the big one – your mortgage.

How much could you save? Well, home and car insurers will charge you as much as £500 extra if you are loyal and renew your premium every year rather than shopping around for the best quote. Similarly, new life insurance quotes are coming out the cheapest they’ve been in eight years, so it’s a good time to think about switching your policy. And with British Gas making huge profits and putting prices up, you’d be mad not to switch to the best online energy tariff you can find if you’re still on a standard tariff.

And that’s just your bills. You may find you are literally wasting hundreds of pounds on credit cards and mortgage costs which you could reduce by opting for a 0% card and switching to a lower mortgage rate.

Plus, did you know you could earn as much as £60 from an empty current account like the Halifax Rewards Account? Or that First Direct and Santander will give you £100 just for switching bank accounts?

And what about your grocery bills? There are heaps of easy ways to slash your supermarket spend, without having to scrimp and save. For example, you could use mysupermarket.co.uk to compare the cost of your trolley in different supermarkets or play this sneaky trick to get £15 off every single grocery shop you make.

Why not put aside a few hours today to reduce all your household bills in one go – you may be surprised how much you’ll effectively ‘earn’ per hour!

3) Go bargain-hunting

The LV= report found that nearly three-quarters (70%) of parents have been actively shopping for lower cost items and ‘value' goods in a bid to cut back. Nearly half (42%) are selling unwanted items on eBay and at car boot sales, and 41% are bargain hunting in second hand shops, an increase from the 31% of parents bargain hunting in last year's report.

After all, why should you pay for things when you can get them for free online? Sign up to sites like Freecycle and Freegle to get alerts when people in your local area offer free childen’s stuff they no longer want to anyone willing to collect. You can also get free children’s books by swapping old books they’ve grown out of for new books via book swap sites, or just visit your local library. Also, the National Childbirth Trust runs 'nearly new' sales around the country. Find your local sale here.

And don’t forget: you can find great discounts and deals on children’s items on sites like Hot UK Deals, Bobsfreestuffforum.co.uk and vouchercodes.co.uk not to mention lovemoney.com’s very own Frugal Friday blog.

More: A sneaky way to get £15 off your groceries | Lower your household bills

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