New research has found that 74% of parents and grandparents are having to financially support their children and/or grandchildren- and the most common expense they’re helping out with might surprise you.
The cost of everything is rising and there are hardly any signs suggesting that these price increases are going to slow down, let alone stop. The cost of childcare, the price of nursery, the general cost of raising a child – it’s all going up. But it’s easy to forget that once you don’t have to buy nappies, or doll out pocket money, or pay for various hobbies and clubs, that your then grown-up children will likely still need financial support from you.
In fact, it’s more than likely that they’ll need your help – and the help of their grandparents too. New research conducted by wealth manager Saltus and published in their Saltus Wealth Index has found that 74% of parents and grandparents are providing financial support for either their adult children, adult grandchildren, or even both.
And it’s not just a little bit of support they need. On average, the research showed that parents and grandparents are providing around £10,000 every year to their family members. And while a third are funding this extra support with their ‘excess’ income, taking advantage of the little-known tax tip for grandparents who want to ‘gift’ money to their grandkids, most have had to make changes to their lifestyles and financial plans in order to help out.
But what do adult children and grandchildren need this cash handout for? According to the research, it’s to cover the costs of higher education with parents and grandparents increasingly having to step in to help the younger members of their family handle the rising costs of university degree courses.
For Gianpaolo Mantini, a partner at Saltus, the findings were hardly surprising considering the new increased costs associated with going to university.
Speaking about the research, he said, “It now costs around £66,560 to go to university, so it is no wonder young people in this country are finding themselves struggling to afford their education and that the older generation are increasingly stepping in to help out.
“And while some can afford to, for others, helping out is having a knock-on effect on their own financial position. Only a third of those surveyed said they were able to provide financial support through excess income – the rest are dipping into pension pots and other bigger and longer-term investments in order to be able to help, which is alarming as it could negatively impact their plans for retirement.”
Elsewhere in family news, heartwarming research reveals the one thing most parents save from kids’ childhoods – and many wish they had saved ‘even more’. Plus, family members ‘teasing’ kids about their weight isn’t innocent, it’s actually more damaging than we ever realised – a psychologist explains why. And, the ‘bedroom parents vs living room parents’ debate has gone viral – I’m the latter and here’s why…
