Chris Kidd

A typical family now pays an average of £186,032 to raise a child from birth to the age of 21 - which amounts to £8,859 a year, £738 a month or £24.30 a day - according to Liverpool Victoria.

Childcare remains by far the largest cost faced by parents, with the average family spending £50,538 on childminders, nursery care, nannies and after-school clubs. But education comes a close second, accounting for a further £47,310 - even assuming a state education at primary and secondary school - covering the cost of uniform and other clothing, school lunches, books and extras such as school trips. It also includes the tuition fees for a typical three-year university degree course and the associated living expenses of being away from home. A private education would hugely inflate that figure.

The group found that the expenses associated with having children had increased by 33% since it began the research in 2003, and forecast that costs could rise by a further 42% between now and 2012 to an average of £265,577 - more than £12,500 a year for each child.

New parents can expect to shell out as much as £8,184 in the first year of their baby's life, once they have paid for nursery equipment, toys and clothing.

The costs are much higher in central London, where families typically pay £199,860 a child, and are cheapest in Wales, at £179,317 a child. Those who choose to educate their child privately face an additional bill of £72,957 for a day pupil and £130,557 for a boarder. Overall the group estimated the total cost of raising all the children born in the UK during 2006 at £140bn, excluding inflation.