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Your support makes all the difference.Parents are becoming increasingly concerned about the debt their children could face later in life, and also say their cash-based savings may not be adequate to provide as much support as they would like, according to a recent survey.
Investment company Orbis Access polled 1,110 UK parents of children aged under 18-years-old to find 75 per cent recognise their children will need more financial support in their early adulthood than they did themselves because of university tuition fees, property inflation, and rising living costs.
At the same time, the company said parental expectations have never been higher, as 98 per cent expect at least one of their offspring to pursue further education. Just over half (55 per cent) said they will help with university living expenses, and 45 per cent expect to help pay some portion of the £9,000 per annum tuition fees.
Driving parents to act, said Orbis, is their worry about the financial burden their children will suffer if they don’t help out: over two fifths (42 per cent) said they were concerned about their children leaving higher education with large debts, and just two per cent ‘don’t want to’ provide any financial help for their children’s future ‘life expenses’.
Although university-related costs take the top spot for many parents, there are other areas of their children’s adult lives they feel they will have to help with. Nearly half (46 per cent) plan on providing support for their child’s wedding, making this their second priority after helping with university living expenses.
Over a third (38 per cent) expect to help with their child’s first house deposit, and 31 per cent intend to support their child with living costs/rent after their education finishes.
Fearing parents are not prepared to deal with all they feel they have to pay for, the investment company has warned how many do not have the right financial plan in place to enable them to help their children with the expenses associated with further education and life after school.
Director of Orbis Access, Dan Brocklebank, praised parents for expecting their children to go on to higher education, but added how the downside is now the costs involved. He said: “Unless parents start to make real financial provision for their children, another generation of students will start their careers saddled with considerable debt.”
Urging parents to seriously consider equity-based investments, Mr Brocklebank added: “They need to start thinking of, and contributing to, Junior ISAs in the same way they do their own pensions, the difference being that they are ring-fencing money for their children to give them a decent financial start when they reach adulthood.”
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