No cash left for the kids say one in three
More than one in three parents (36%) have no savings account set up for their child, according to new research from The Co-operative Bank.
The survey of UK parents also found that rising living costs have forced a third of mums and dads to put less money away for their little one than they were a year ago.
Findings show that the average amount saved by parents for their child is £10 or less per month. The research also revealed that fewer than one in seven are saving more than £50 per month for their child.
With many students facing University tuition fees of up to £9,000 per year from 2012 and the average age for first time home buyers on the rise, the majority of parents are plagued by savings guilt. As many as 65% of mums and dads said they wished they could save more for their children's future than they can currently afford.
For those mums and dads that have managed to set up savings accounts for their kids, 52% said they plan to keep the nest egg a secret from their child. Almost half (42%) of parents said they want their son or daughter to be at least 19 before they have full access to their savings. Most parents blame the lack of financial awareness among youngsters for this decision, with 80% calling for better education on financial issues in schools.
"It's a tricky time for parents as they try to do their best for their child's future, while providing for them at a time when living costs are continually rising," said James Hillon, Head Of Savings at The Co-operative Bank.
Further findings from the research revealed that the main incentive for mums and dads saving for their child is to help with their education in later life (52%). However getting the kids on the property ladder was also a concern (47%) along with helping to buy them a car (26%). Given high youth employment, a fifth (20%) of parents said they were saving to support their child if they struggle to find work in adulthood.
"It might not seem a lot, but saving as little as £10 per month for your child is definitely worthwhile and will help them out in later life," added James Hillon. "New savings accounts for children are on their way and we're currently working on our own plans to launch a Junior ISA. Hopefully the introduction of tax free savings for children will encourage more parents to put a little aside for their kids."