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Over one and a half million British adults providing financial life line to elderly relatives

Posted in: Research Last updated: 11 Jun 2008

With 54 per cent of retirees struggling to make ends meet, new research from engage Mutual Assurance reveals that families are stepping in to provide a financial life line to their elderly relatives.

Nearly one in ten British adults (9%), the equivalent of more than 1.7m adults1, is helping with the costs of their parents’ retirement. Of these, 22 per cent have given money to their parents to help them to make ends meet on day-to-day expenses; 22 per cent are paying towards their parents’ care, and 33 per cent have taken their parents into their or a relative’s home in order to reduce their costs of living and care.

The research was conducted as part of engage Mutual’s 3GB research, which looks at the changing financial relationships between family members. A GB representative sample of adults with parents over the age of 65 was questioned in order to understand how they are supporting their parents in retirement2.

accommodating elderly relatives
Overall, three percent of adults with parents over 65 (more than half a million3) have brought their parents to live with them or relatives to cover the costs of their retirement. As parents get older, the need to move them into the family home in order to provide care increases significantly. Of Britons with parents between the ages of 85 and 94, one in ten (10%) are accommodating their parents in their or a relative’s home in order to reduce their costs of living and care.

retirement putting a strain on family relationships
One in four (25%) Britons with parents over 65 is concerned about how the family will cover the costs of their parents’ retirement or that their inheritance will be spent by their parents in paying for their retirement.

Of all adults with parents over 65:

  • 14 per cent say that they are worried that they cannot afford to pay for their parents to go into a care home.
  • 11 per cent say that they are worried that they cannot afford to support their parents in retirement;
  • Nine per cent are worried that their parents cannot afford their own retirement; and
  • Eight per cent worry that their parents will spend all of their inheritance to fund their retirement.

 making provisions for retirement
Just 42 per cent of adults say that their parents have enough money saved to afford their retirement. A further five per cent expect their parents to release equity from their home in order to afford retirement and six per cent say that their parents have downsized their home in order to afford their retirement.

Going further to support their parents in retirement, one per cent of Britons have saved money to help support their parents through their retirement.

 regional findings

  • The South of England4 has the highest proportion of people worried about how their parents over 65 will afford retirement, with 45 per cent voicing a concern.
  • Those in the Midlands are the most likely to be supporting their retired parents (16%).
  • People in Wales are the most likely to say that their retired parents have enough money saved to cover their retirement (57%), whilst those in the Border region are least confident in their parents savings (19%).

Karl Elliott, 3GB spokesperson for engage Mutual Assurance said:

“As costs of living increase, retirees are finding it increasingly difficult to make ends meet. In hard times people often turn to family members for support and, as our research shows, this is the case for elderly relatives as well as young adults who are finding it increasingly difficult to disconnect themselves financially from their parents.”

footnotes

1 the UK adult population is 60, 943,912(https://www.cia.gov/library/publications/the-world-factbook/print/uk.html). According to engage Mutual’s research, 31% of British adults have a parent over the age of 65. Nine percent of these are helping to support their parent financially, which is equivalent to 1,700,335 adults.

2 3GB is engage’s Three Generation Britain research index. Research was conducted by YouGov across a GB representative of 2,084 adults (including 640 adults with parents over the age of 65) between 11th April and 14th April 2008. The research explores the financial relationships of care between the generations and investigates shifts in traditional financial provision.

3 the UK adult population is 60, 943,912(https://www.cia.gov/library/publications/the-world-factbook/print/uk.html). According to engage Mutual’s research, 31% of British adults have a parent over the age of 65. Three percent of these are helping to support their parent financially, which is equivalent to 566,778 adults.

4 excludes London and South-West (results for these regions available on request)

engage Mutual Assurance can be contacted on 0800 169 4321 or by visitingwww.engagemutual.com

The information contained in this press release is intended solely for journalists and should not be relied upon by private investors or any other persons to make financial decisions.

notes to Editors:
1. engage Mutual Assurance is a trading style of Homeowners Friendly Society (HFSL) and it’s wholly-owned subsidiary engage Mutual Funds Limited (EMFL).
2. engage Mutual Funds Limited (EMFL) is a provider of the Child Trust Fund direct and in partnership with firms including Legal and General.
3. engage supports mutuality, friendly societies and the regional financial services industry through links with the Association of Mutual Insurers, the Association of Friendly Societies, Mutuo and Leeds Financial Services Initiative.
4. established in 1980, Homeowners Friendly Society Limited (HFSL) is Registered and Incorporated under the Friendly Societies Act 1992, Reg.No.964F, it’s wholly owned subsidiary engage Mutual Funds Limited (eMFL) is Registered in England No 3224780. Both are authorised and regulated by the Financial Services Authority (FSA).
5. Homeowners Friendly Society Limited’s FSA Register number is 110072 andengage Mutual Funds Limited’s FSA Register number is 181487. You can check this on the FSA’s Register by visiting the FSA’s website www.fsa.gov.uk/register or by contacting the FSA on 0845 606 1234