Parents are facing some challenging financial pressures these days, as the increase in the cost of living hits them harder than others.

Sarah and Cliff Hammell are among those trying to deal with the growing pressure.

Their son goes to a Conestoga College child care centre in Kitchener. At a cost of about $1,100 per month, it's their second largest monthly expense. Only to their mortgage is higher.

Sarah says "It is quality of care, that's what I'm paying for and that's peace of mind to me."

Fees for infants at the day care are close to $1,500 per month, $1,120 for toddlers and almost $900 for preschool children.

Cliff works in engineering at an auto assembly plant while Sarah works in accounting at a medical supply company. Even with two incomes they budget carefully.

Cliff says there is "a lot of discussion with my wife on how we budget, what we want to spend in terms of variable expenses."

According to a 2006 report from The Vanier Institute of the Family, the cost of raising a child to age 18 is $167,000. That covers food, clothing, health care, transportation, shelter, furnishings and recreation, but not college or university costs.

But it's not always the most obvious expenses that are a concern. For example as the cost of gas rises, so does the price for driving children to sports and other activities.

According to CIBC Economics rising gas prices could cost each household an extra $950 this year. In addition food prices are also expected to rise five to seven per cent.

The Hammells have planned their family and budgeted for the added expenses that come with children from the time they were married, but other young parents haven't and that can lead to conflict.

Professor Kathleen Rybczynski is an economist at the University of Waterloo who specializes in gender economics.

She says families with financial challenges are likely fighting more, "I think it's going to cause more stress within the family, certainly for budgets that are on the limit that are really being stretched. I think people will go into debt."

The Hammells say they can cope, and are financially prepared for their next child, who is expected in just two months.

Sarah says "You make choices. Instead of eating out I cook, instead of buying brand new toys he gets toys from garage sales and consignment sales. It's new to him, it doesn't matter."

But the Hammells say two children will be their limit.

Coming up in part two: How a stay at home mom with a family that includes five children gets by on one income.