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Lee and Elaine Jeffery with their son Jack.

IT'S possibly the biggest expense besides buying a house - bringing up a child.

In fact researchers have put a price on all those years of love, laughter, tears, and tantrums from the day your child is born until they finish university at the age of 21.

In the most recent Cost of A Child survey compiled by insurance and investment group LV parents' offspring are costing an average of £186,032 - the equivalent of £8,859 a year, £738 a month or £24.30 a day.

The figure includes everything from nursery fees from six months to school age (£34,320), food (£16,386), holidays (£13,359), and toys and hobbies (£9,822).

Looking into the future LV has predicted that by 2012 the cost of raising a child in the UK could reach £265,577, equivalent to more than £12,500 a year Nigel Snell, an LV director said: "The projection figures are quite staggering and its quite unrealistic to expect people's income levels will increase in line with this rising level of expenditure.

"This means parents will need to be switched on about their family finances more than ever, even though they have always known that raising a child is costly."

It's not all doom and gloom as there's no reason why you can't start as you mean to go on by saving money along the way.

One simple saver to begin with is to see whether you can cut spiralling childcare costs which continue to rise above the rate of inflation.

According to the D a y c a r e Trust's most recent childcare survey a typical fulltime nursery place for a child under two in the south east is now £179 per week - an increase of nearly five per cent in the last 12 months.

But it is possible for working mums and dads to ease the financial burden by claiming childcare vouchers from their employers These vouchers cover childcare up to the age of 15 and can be used at any nursery, playgroup or childminder registered by Ofsted.

Usually employees agree to exchange a proportion of their salary for childcare vouchers.

But because the childcare vouchers are taken from your pre-tax income it means you can make big savings.

For example, for every £100 a basic rate taxpayer chooses to exchange for a childcare voucher, they get £130 worth of vouchers back thanks to the tax and national insurance relief.

Up to £486 a month Each parent can claim up to £243 a month for childcare regardless of the number of the children - bringing the total amount a working couple can claim in childcare vouchers up to £486.

A basic rate taxpayer using the full allocation of childcare vouchers can save £75.33 a month and a higher rate taxpayer can make a monthly saving of £97.20.

One couple to have benefited from the scheme are Lee and Elaine Jeffery from Southampton who each claim the maximum £243 monthly amount of childcare vouchers - bringing their combined total to £486.

As they are not paying income tax or national insurance contributions on this money it means they are saving in the region of £1,500 a year for son Jack who spends four days a week at the University of Southampton nursery.

Its made a big different to journalist Lee, 35, and Elaine, 33, an account director at Southampton's Lawton communications group.

"As the money comes out of our wages before tax we get the childcare vouchers tax free," said Lee.

"It makes a big difference to us.

We can put the money we save towards a holiday and it can also help to cover the cost of nappies and extra food every month."

However, not all employers offer childcare vouchers. It's always worth asking though as the scheme should not cost any money to administer.

As a general rule of thumb lower income earners may be better off claiming childcare tax credits to help with childcare costs, worth up to £140 a week for one child, or up to £240 a week for two or more, through the working tax credits system.

You cannot claim the childcare element of working tax credits and employer provided childcare vouchers.

8:38am Friday 11th July 2008

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