EasyG - I'll let you into a little secret, nobody ever thinks they are ready for parenthood (either emotionally or financially) and if we all waiting until we were we'd be too old to have kids.
Even though my wife and I were "trying" (ugh...hate that word - let's just call a spade a spade already!) it still knocked me into a mad panic when she came into the kitchen after taking the pregnancy test and said it was positive. You think all kinds of things, will I be a good father, how would they cope if something happens to me, do we have enough money etc. etc. I was still panicky when she nudged me awake at 5 a.m. 2 february's ago and told me her waters had broken. That panic all fell away when I held Aleksander for the first time. Heck, if you weren't even slightly worried about something so monumental there'd be something seriously wrong with you!
Truth be told, it doesn't have to cost an inordinate amount to bring up a child, they need love and attention more than they need the latest and greatest toy - heck, you buy them the toys and they have more fun playing with the boxes! With your salary you'll also qualify for a decent chunk of child tax credits, and you always get the £20 a week child benefit as it's not means tested - that should keep your baby clothed/fed easily.
There are also benefits to having a baby "early" (I say "early" as historically 21 and 25 isn't particularly early to have children) - there is an inordinately smaller risk of birth defects (it's worrying to see how much the risk of this increases just with the mother and father being a few years older) and you'll have more energy for those late nights and early mornings!
Yes, you will lose some freedom, but I'm sure grandparents will be more than happy to babysit some evening so that you two can go out and enjoy yourselves - in fact - it makes the quality time you spend together even more special. Also, worrying about not being able to stay together is a self-fulfilling prophecy, if you start having doubts like that they niggle away at you and you'll end up breaking up for definite (you'll start doubting yourself, your self esteem will get lower and you'll start picking fights for silly reasons).
Thinking back, one of the things I was most worried about (changing nappies) really isn't nearly as bad as you assume it's going to be!