Parental spending 8% more on children than last year
Research from Scottish Widows shows over half (56%) of parents with children over 16 have given or loaned money to children or grandchildren, with some getting into debt to do so.
The savings bank calculates nearly two million parents have been forced further into debt because of their children.
Savings interest lost
The majority dipped into savings and just under half say they can’t replace the lost cash.
As a result, 22% of the baby boomer generation have had to cut back on their daily spending, over a quarter are saving less (27%), and over one in ten (11%) has stopped saving.
Roughly a quarter of young adults used the hand-outs for spending money, whereas over a third paid off debts and 30% wanted the cash for a property deposit.
Relatively recent schemes such as child trust funds may in future provide a way of giving youngsters a lump sum when they leave school without having to resort to the bank of mum and dad too heavily.
Gordon Greig, head of savings and investments at Scottish Widows, said: ‘It’s questionable as to whether the current younger generation of adults will ever learn the necessary savings habit if their parents continue to bail them out in this way.’
If you want to encourage your children to save, you could start by checking out our children’s savings account finder to find an account to suit your child.
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