The findings show that, as reality dawns, British parents expect to be bankrolling their kids well into their mid sixties. What’s more, with financial commitments lasting longer than anticipated, British parents are forgoing aspirations from their youth.
With 46% of parents with children over the age of 25 still supporting them financially, the Bank of Mum and Dad (BoMaD) generation are banking on mum and dad well into their sixties. Despite parents now in their 20s expecting to regain financial independence from their children by the age of 50, the research shows that, in reality 43% of parents aged 55 to 64 are still supporting their children, and do not expect to gain financial freedom until the age of 67.
As part of it’s 3GB1 campaign to unearth the financial interdependencies between three generations of Britains, Engage Mutual Assurance asked a representative sample of 2,298 parents when they expected to be able to afford common life-stage goals, including buying a second home and retiring, and when they anticipated no longer supporting their children financially. The results reveal how parents’ expectations change as financial reality hits.
Parents supporting children:
- 45% of over 50 year olds are still supporting their children financially, and almost 1 in 10 (9%) are expecting to be bank-rolling their kids beyond 60;
- The average British parent anticipates providing financial support to their children until the age of 59;
- Parents in the West Country expect to bank-roll their offspring for the longest, anticipating reaching the age of 65 before cutting the purse strings, compared to parents in Lancashire who are most optimistic, expecting not to support the kids past 57 years old.
Parents delaying plans:
- With the realisation that they will be funding kids for longer, British parents are curtailing life stage aspirations. Parents aged 18 - 24 years old anticipate retiring three years earlier than 55 - 64 year olds. Furthermore, the proportion accepting that they will never be able to afford to buy a second home increases dramatically with age, as 27% of 18 - 24 year olds realise that they will never buy a second home, compared to 70% of 55 to 64 year olds.
Karl Elliott, 3GB spokesperson for engage said:
“University tuition fees, rising costs of living and house price hikes mean that young people are finding it increasingly difficult to gain financial independence. As a result of this pressure on younger generations, parents are shouldering the financial burden, supporting their children for longer."
“This research shows that the expectations of younger parents are not always realistic. In reality it is likely that they will continue to support their kids financially for longer than they anticipate. It is therefore essential that parents of younger children lay down plans to save little and often in order to ensure that their child’s needs don’t affect their future independence.”
1 3GB or ‘3 Generation Britain’ is an ongoing quarterly research initiative by Engage Mutual Assurance to understand how financial ties impact on family relationships. Research released by Engage Mutual Assurance in August 2006, carried out by YouGov across a GB representative sample of 2,000