Would you turn to grandma or granddad in a cash crisis? You might not be alone – a report from Investec Wealth and Investment reveals one in six grandparents are lending an average £2,496 to their squeezed grandkids.
So why are granny and grandpa helping out their grandkids? According to Investec Wealth and Investment’s research, most (47%) are giving handouts to help pay down debt or just help with day-to-day living costs.
I can relate – the combination of student debt, rent and the rising cost of transport means that a cash handout from a generous grandparent certainly wouldn’t go amiss. And with property prices at sky-high levels, I doubt I’ll be able to buy a house without some help from a family member (or a lottery win!).
Grandparents living in Wales seem to be the most generous, with 21% of them telling Investec that they give their family a helping hand. But you’ll be less fortunate if you live in the East of England – just 10% of grandparents from this part of the country say they help their family members jump financial hurdles.
An older shoulder to lean on
One of the reasons grandparents are gifting money to their younger relatives is that they’ve become more financially savvy – they’re aware of the impact that inheritance tax could have on any assets they pass on.
Grandparents also want to see their grandkids benefit from the help they give them. Thanks to the recession, many younger people have been made redundant or been forced to take lower-paid jobs. Our latest research also shows that irresponsible lenders are pushing Brits into a cycle of debt. So if grandparents want to help ease the burden, why shouldn’t they? That’s if they can afford to…
Would you lend thousands of pounds to a struggling family member? Or would you accept financial help from your older relatives?