How it evolved
So in my first blog, I explained how Costs to Expect all began – as an all-consuming social experiment to track how much it costs to raise children to the age of 18.
As I said, in the beginning hubby kept a very crude excel spreadsheet which literally recorded what the expense was and its value. I soon got used to the question, “So what did you spend today?!” At first, it was pretty straightforward as everything we brought for Jack was directly attributable to him – for example nappies, milk and clothes. If I brought any of these things in our monthly shop, I simply pulled them out as his expenses.
Things became a little more complex as Jack grew older and began eating and using the general household shopping. We periodically reviewed our shopping and allocated a percentage to him. For example, when he was two and eating the same us, we allocated 10% of our shopping to him. Now, at the age of eight, his percentage has increased to 23% – I dread to imagine our shopping bill as he hits the teenage years and we have another hungry lad coming up behind him!
We’ve had many discussions / debates about what we should include and what should be discounted. For example, we haven’t included a share of our utility bills as we figured these would be more or less the same without the children. However, we have included an allocation for our summer holidays when it has been somewhere we might not have gone if it wasn’t for the boys – typically for us a week at Center Parcs which is family focused. We’ve sometimes disagreed over what to include and/or the percentage and the question we always ask ourselves and each other is, “Would we have brought this / done this if we didn’t have the boys?” Most of the time, this solves it one way or another.
What I should say is that we absolutely recognise that every family and their budget is different and that’s why when we built the first version of the app, we decided to categorise the expenses into “Essential” and “Non-Essential” costs. We define essential costs as “The costs that we see as absolutely necessary in raising a child and in essence, keeping them healthy and alive” – pretty obvious I’d say. The non-essential costs are explained as, “The optional costs of raising a child and those which spark lively debate between Mummy and Daddy”.(!) And boy, have there been plenty of those! So in truth, the essential costs are the minimal amount needed to raise a child, with the optional costs varying between families and combined, they offer a rough guide to the overall cost of raising a child.
An interesting debate that we had was around the cost of childcare and how we catagorised it. For many families with two working parents, we recognise that this would be regarded as an essential costs. However, we decided to allocate it as a non-essential cost, mainly because I wasn’t working but having some childcare support helped me in managing my condition (read more here), particularly when Dean was in demanding contracts which kept him away from home.
Another interesting point in the experiment came along with the arrival of our second little boy, Niall. We pondered the question, did it really cost £250K to raise each child? Surely the second should be slightly cheaper because of all the things you brought the first time round which could be reused? This led us to build in what we call “Partial Transfers” – where we transfer 50% of the cost for anything that has been used again from Jack to Niall. As Niall is only two, we’re yet to see the impact of this but it is on my list of upcoming blogs.
I hope this gives an insight into the project and how it has developed; there will be more to come as well as blogs about how the project has grown and our vision for the Costs to Expect service.