Parents are sacrificing their savings to bankroll the demands of their children, a building society has claimed.
The Wolverhampton-based Birmingham Midshires said that for every pound that Britons manage to save, they have to draw out three from their savings to meet the demands of their children.
The society's Saving Britain Index reported that over the last three months of 2004, working parents of teenage or older children managed to save an average of just £720 but then raided £1,950, leaving their savings accounts £1,230 worse off.
The findings show that the cost of bringing up children is steadily rising, and highlight a stark need for the rises in child tax credit and child benefits as announced by the Chancellor in last Wednesday's Budget, the society said.
This phase of the Index dispels the notion that Brits are not saving, rather it shows that the nation's savings crisis centres on people's inability to leave their savings intact.
It also revealed working parents of older children have the highest levels of debt (£2,958) and the lowest levels of saving (£6,613), leaving a balance of just £3,655.
Parents of younger children are preparing for the future, saving an impressive £1,678 over the last three months of 2004, but they are also raiding more than they are putting away (£1,928).
Young home-owning parents have raided the most out of their savings. Despite saving more than any other groups (£1,678), they have taken out the most (£1,928).
Proportionally, homeowners with older children will be taking the most out of their savings accounts. Having put away an average of £720, they are taking out £1,951.
Although the under thirties will raid the least from their savings (£236), they will also save the least, at £439.
The over fifties have the greatest amount of savings (£7,883). Owing £587, they have the highest net financial balances, at £7,296 each.
Just five per cent of people put money aside for their children. Married homeowners with children saved the most at an average of £481 each. Single under thirties saved the least at just 41p.
Homeowners with kids saved the most towards DIY (£385) whilst under thirtyyearold singletons saved the least for home renovations, at an average of £42.50.
Over fifties are saving the most for retirement and also for weddings - at £61 and £147 respectively whilst under thirties saved more than other groups for birthdays (£18) and hobbies (£21)
Richard Brown, head of savings products, said: "It's plain to see from our research that children cost more as the years go on. The Government's Child Trust Fund initiative has been launched to help parents plan for the cost of parenthood and the Chancellor's moves to increase tax credit and child benefits will be welcomed by parents across the UK."