Four in ten (41%) of British parents unable to save for their children’s future

News & comments

29 March 2021

A nationwide survey of parents has revealed the extent to which millions of families feel financially stretched, with no extra cash to put aside for their child’s future.

41 per cent of UK parents say they are unable to build up a nest egg for their child with the main reason stated as simply not having the spare cash, whilst one in twenty (5 per cent) admit they would rather spend any surplus money now rather than worry about the financial future of their children.

Despite this, as many as 39 per cent feel it is the duty of every parent to save for their children, whilst 55 per cent of the parents polled believe it is their duty but struggle with the obligation.

A further 14 per cent have genuine concerns they will not be able to leave any inheritance to the children, while a further one in ten do not feel confident they will have any assets to leave their kids when they die.

The survey, by wealth manager Brewin Dolphin, found as many as eight per cent of parents admit they have been forced to dip into their children’s savings, and of those who are able to put regular money aside, as many as 36 per cent worry it is simply not enough for their offspring, while the same percent fear they could leave their children in debt.

For those who can afford to save for their kids, £125 a month emerged as the national average, with the average UK child having amassed nearly £5,000 by the time they reach school at the age of 5 and £12,000 by age 21.

Regional Differences

Parents in Sheffield are able to save the least – averaging £65 a month according to the report, followed by those based in Leicester who save £86 a month on average.

This compares to Londoners who are able to dedicate the most at £195 for their children on average each month, followed by parents based in Plymouth who secure £184 monthly.

Life Moments

When it comes to the milestone moments such as weddings, driving lessons and first cars it appears that many British parents simply do not have the funds to help their children out.

37 per cent are unable to help towards a deposit for a first home, while 30 per cent are unable to help their kids through university, a further 30 per cent will not be able to contribute to their child’s wedding.

Driving lessons (26 per cent), gap years (22 per cent), school trips and exchanges (12 per cent) and 18th or 21st birthday celebrations (16 per cent) are among other things many modern parents will struggle to help finance.

The majority of parents claim they began saving for their children’s key life moments when they were five years old, with 15 per cent even admitting they began before their child was even conceived.

Yet a more hard-line one in 20 (six per cent) insist children should start from scratch and make their own money and their own way in life, without assistance from their parents.

Kirsty Simpson a financial planner at Brewin Dolphin who commissioned the survey and advises families on how to grow their wealth said, “This research clearly highlights that many parents have concerns around saving up and securing their child’s future, with 31 per cent of people admitting they simply don’t have the spare cash.”

“We understand that everyone wants to do right by their child but appreciate it can be extremely difficult financially at times. When we’re advising our clients we always try to look for any possible savings in their day-to-day lives that could be made. Perhaps it’s that takeaway on a Friday night, or that gym membership that hasn’t been used.”

“As they grow out of unwanted toys and clothes, sell these. Better still, get the children involved in this process and let them set up a stall at the front of the house and ask for donations for their old unwanted items.”

“Instead of large presents on birthdays or at Christmas, use part of the budget to save for their future. And if other people gift cash, perhaps let your child spend some of it but ask them to save some too.”

“And those who are entitled to child benefit could also think about putting that money away into a Junior ISA or savings account to accrue into something more substantial over the years.”

“These small amounts, when put aside, soon add up over the course of your child’s upbringing. But once the pot of savings is large enough, invest it. Do not leave it in cash as it will be eroded by inflation. If the savings are for when your child is 18 you have time on your side to take some risk and grow the pot,” concludes Simpson.

-ENDS-

*The research of 1,500 parents with children currently at home was commissioned by Perspectus Global in March 2021 on behalf of Brewin Dolphin.

PRESS INFORMATION
For further information, please contact:
Richard Janes richard.janes@brewin.co.uk / Tel. +44 (0) 20 3201 3343
Siân Robertson: Sian.Robertson@brewin.co.uk / Tel: (0) 20 3201 3026
Anita Turland: anita.turland@brewin.co.uk / Tel: (0) 20 3201 4263
Payal Nair payal.nair@brewin.co.uk  / Tel: +44 (0) 20 3201 3342

NOTES TO EDITORS

Disclaimers:

  • The value of investments can fall and you may get back less than you invested., Information contained in this document is believed to be reliable and accurate, but without further investigation cannot be warranted as to accuracy or completeness.
  • Brewin Dolphin is authorised and regulated by the FCA (Financial Services Register reference number 124444)

About Brewin Dolphin

Brewin Dolphin is a UK FTSE 250 provider of discretionary wealth management. With £51.4* billion in total funds, it offers award-winning personalised wealth management services that meet the varied needs of our clients including individuals, charities and corporates.

We give clients security and wellbeing by helping them to protect and grow their wealth, in order to enrich their lives by achieving their goals and aspirations. Our services range from bespoke, discretionary investment management to retirement planning and tax-efficient investing. Our focus on discretionary investment management has led to significant growth in client funds and we now manage £44.6* billion on a discretionary basis.

Our intermediary business manages £15.8* billion of assets for over 1,700 advice firms either on a discretionary basis or via our Managed Portfolio Service and the MI Brewin Dolphin Voyager fund range.

In line with the premium we place on personal relationships, we’ve built a network of 34 offices across the UK, Jersey and Dublin, staffed by qualified investment managers and financial planners. We are committed to the most exacting standards of client service, with long-term thinking and absolute focus on our clients’ needs at the core.

For more information, visit: www.brewin.co.uk

*as at 31st December 2020


The value of investments and any income from them can fall and you may get back less than you invested.