21st January 2015
Parents and grandparents helped their grown-up children with £35.2 billion of support last year, a study has found.
UK parents provided £29.6bn, while grandparents provided a further £5.6bn, the Lloyds Bank Family Savings report revealed.
Parental support equates to an average of £753 per head each year, for all UK adults.
The biggest cost for parents is helping adult children to get onto or move up the housing ladder – which amounts to a total of £8.3bn in support per year and an average of £13,281 per person receiving this help.
Overall, just under a third of all UK adults say that they could not afford to buy a house without financial help from their parents. This rises to 55% of 25-29 year-olds.
The second largest type of support is cash gifts and payments (£5.1 billion annually) and the third largest component is support for buying cars (£2.6 billion).
With more people entering further education, rising house prices and a challenging job market for young adults, there is no sign of a slowdown in parental support for adult children.
Nearly four in five young adults (aged 18 to 30) now receive some form of financial help from their parents after the age of eighteen, compared to 60% during the 1980s.
Similarly, over a third now also receive support from their grandparents, more than doubling from 15% in the 1980s.
A large majority of UK adults (70%) still say that they would feel they were letting down their family if they did not save for the future, and two-thirds (66%) feel that children cannot hope to achieve success in life without financial support from their parents.
Close to three quarters (72%) now believe that parental financial support will become more important in future.
Overall, more than a quarter (27%) of UK adults say that they will be reliant on inheritance from parents to provide themselves a comfortable retirement. This percentage is highest among adults aged between 31 and 34, at 39%.
Philip Robinson, savings director for Lloyds Bank, said: “Clearly, the financial demands on parents and grandparents are now huge with billions being given to children each year to purchase things like homes and cars.
“Now, more than ever, saving for the future is really important. Good savings habits like saving small regular amounts each month, particularly into tax free ISAs, can really help to build a savings pot over the longer term.”