Bank of Nan and Grandads’ billions for student grandchildren

The Bank of Mum and Dad is fast becoming the Bank of Nan and Grandad – after a poll revealed that Britain’s over 50s plan to give their grandchildren £16.7 billion for their university costs.

A Saga Savings poll shows that more than a third of Britain’s estimated 11.8 million grandparents have funded, or are planning to help fund, their grandchildren’s studies. The survey of almost 10,000 over 50s shows that, on average, they will each fork out nearly £4,000. This suggests that older Britons, having worked hard and saved all their lives, are more than happy to let wealth cascade down the generations – if it means helping them get on in life.

In addition, two thirds (67%) of over-50s parents contribute an average of £6,777 to the cost of sending their children to university – according to the poll. 

The figures stand in stark contrast to the amount grandparents said they were saving and contributing to university costs five years’ ago. A Saga poll in May 2009, of more than 13,000 over 50s, showed that 41% of grandparents put money aside specifically for grandchildren – to help with things such as university costs. But the total pledged was just £1,000 over five years – almost £3,000 less than the latest amount grandparents say they have contributed.

Andrew Strong, chief executive, Saga Personal Finance, commented: “The billions that Britain’s grandparents put aside for grandchildren shows both how hard they have worked and saved all their lives and also how lucky teenagers are now to have such generous relatives.

“These days, it pays for the over 50s to be savvy savers and intelligent investors, if they are to continue this generous support. Allowing wealth to cascade down the generations, seeing how their money supports their kith and kin, is the very heart of what it means to be a modern grandparent.”