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More than one in five young adults have delayed having children or abandoned starting a family altogether as a result of the squeeze on finances.
Pressures mean that many would-be parents aged between 18 and 34 have changed their plans for a family, according to mutual Royal London.
Inflation means that families with young children have seen costs rise by around £1,000 a month since February 2023. As a result, nearly 20pc of parents have no money left over for unexpected bills or emergencies, the survey found.
Housing costs have added significant pressure to budgets. Among those surveyed the group were the most likely to be mortgage holders with 44pc saying they are likely to cut back on everyday spending to pay for increased loan costs.
Sarah Pennells, consumer finance specialist at Royal London, said: “We’ve been tracking how people have been responding to the financial challenges of the rising cost of living for more than two years and it’s clear we’re now starting to see that people are making changes to their longer-term life plans.
“We know that high interest rates, which have fed through to higher rents as well as mortgage rates, are causing a real squeeze in the finances of many people in their 30s and 40s.
“Even if the Bank of England reduces interest rates later in the summer, it won’t help those homeowners who’ve had to remortgage onto a higher fixed rate deal. In some cases, this is costing families hundreds of pounds extra a month.”
