A recent study has estimated that the cost of raising a child just up to age 11 costs around £90,000. Obviously, this is a figure that is going to strike many people as incredibly expensive, but there are certain ways to reduce this cost. Recent research has shown that parents are not just being kept awake by noisy children, but they are also not sleeping properly because they are concerned about the financial situation that they face having just had a child.
It is estimated that last year nearly 40,000 parents decided to get help from the charity dealing with people with debt called the Consumer Credit Counselling Service. Most of the people who came to the service were dealing with a situation where they had suddenly had a drop in income, and were struggling to afford childcare which would allow them to return to work.
The £90,000 figure has come out of the bank Halifax, and the report has stated that people should make sure that they claim all of the benefits that they are entitled to. The cost of raising a child is significantly reduced by tax credits which make it easier to afford the basics for children.
Unfortunately, child benefit is going to be axed altogether for taxpayers in the higher bracket in 2013, but it is important that until that time you make sure you claim everything you are entitled to.
Fortunately, for those in the lower income bracket, they are still going to be entitled to a great deal of childcare assistance. For those who bring home less than £16,000 a year, they are going to be entitled to the full amount of tax credits, which is around £3000 per child, per year. This is a significant amount of money and will really ease the burden that you face.
As well as focusing on the incomings that you are entitled to, it is also important to reduce the amount of money that you are spending. One of the easiest places to cut back on is toys. Children tend to be very fickle when it comes to toys, so you will often find that you buy them something expensive, only for them to not want to play with it in a few weeks time.
For this reason, it is not a good idea to go out and immediately buy the latest toys for your child. Instead, try buying second-hand toys from charity shops, or getting online to a popular auction site such as eBay to pick up something at a significant discount.
Additionally, it is possible to save money if you collect loyalty points. Many parents will find that supermarket shopping is very expensive, and you will quickly build up loyalty points because of this.
One of the most popular schemes in the country is Nectar, where points can be translated into supermarkets spending, where you can buy many items that are useful for raising a child. Many of the most popular stores in the country are members of this loyalty scheme.
Childcare vouchers are also something that shouldn’t be ignored. If you have recently returned to work, it can be a good idea to ask your employer whether they do offer vouchers for childcare. These are tax beneficial, and allow you to receive money which can be contributed to childcare.