Australian parents have spent more on their children over the past five years, thanks in large part to technology and food, according to a new study.
Suncorp Bank’s new 2021 Cost of Children report shows the cost of raising a child in Australia has increased by more than 10% since 2016.
Technology and food are the main drivers of rising costs, as parents become more comfortable with using buy now / pay later services to keep pace.
The cost of keeping kids connected
The report named technology and communications devices as the “biggest expense ever,” with parents spending 186% more to keep their children “connected” since 2016.
Ebru Karapinar has two children, aged seven and five respectively.
She said she initially bought every child an iPad to keep them happy on long car trips, but now the TV at home is barely used as everyone is just watching what they want. on their own devices.
âDo I think that’s a good thing? Not really, to be honest, âshe said.
“It’s just today’s generation, everyone has one.”
Suncorp Bank data backs up Ms. Karapinar. Average monthly spending on mobile phones, computers and game consoles has increased from $ 37 per child in 2016 to $ 106 this year, and is expected to exceed $ 300 by 2026.
Food has also increased the costs of raising children.
Full trolleys emptying wallets
Suncorp Bank executive managing director Nick Fernando said rising food costs mean parents are spending more than ever on feeding their families.
The average parent now spends $ 402 a month feeding their child, up 60% over the past five years, according to data from Suncorp Bank.
âI remember when I was a kid, we had an overloaded cart and we were doing the [shopping for] $ 100, âMs. Karapinar said.
âWhereas now, when I go to do my shopping for the kids, I have two bags and it costs me over $ 100. “
How parents cope with rising costs
Ms Karapinar said she hasn’t noticed any increase in the cost of raising her second child over the first, but expects this to change as the child reaches the age it begins. to develop more interests and hobbies.
But she said it was evident that the cost of raising children had increased since she was a child.
âMy mother always says, ‘If I had to raise children now, we would never even have the means to have children,â she said.
But Ms Karapinar said she learned lessons about spending money after her first child, which helped her save money after having her second.
âWhen it’s your first child, whether you can afford it or not, you tend to spoil it,â she said.
“So you’re a little wiser with what you spend money on [with your next child]. “
The rising cost of raising children comes as Australia’s fertility rate hit an all-time high of 1.66 in 2019.
Even families with two working parents might find it difficult to keep up with the rising costs, as OECD data shows average-income Australian couples raising two young children are spending about 17 percent of their income on full-time net care.
Ms Karapinar said that even with a work partner, it was difficult for her family to cope, despite the government payments she received as a stay-at-home mom after the birth of her first child.
Parents willing to pay later
Ms Karapinar said she had to buy now / pay for services later to meet expenses so as not to empty her bank account.
She is not alone, as the Suncorp Bank report shows that 40 percent of parents now choose to use a BNPL service.
“I use [buy now/pay later] a lot actually, and I find it really helpful, âshe said.
“I think if you’re responsible for it, it’s a really good and useful tool for everyone.”
She said she previously relied on BNPL’s services when she had no money to spend, but now uses it for large purchases to make sure she has enough money left over. money in his bank account for emergencies.
While BNPL can be useful, experts warn consumers to be careful to avoid accumulating too much debt and late fees.
âObviously, don’t go crazy about it,â Ms. Karapinar said.