Old age parents funding BOMADS

Young parents need to wake up to the costs of parenting if they think they’ll be free of the burden of their children by the time they’re 50, according to new research by engage Mutual Assurance.

The findings show that, as reality dawns, British parents expect to be bankrolling their kids well into their mid sixties. What’s more, with financial commitments lasting longer than anticipated, British parents are forgoing aspirations from their youth.

With 46% of parents with children over the age of 25 still supporting them financially, the BOMAD generation are Banking On Mum And Dad well into their sixties. Despite parents in their twenties expecting to regain financial independence from their children by the age of 50, the research shows that, in reality 43 percent of parents aged 55 to 64 are still supporting their children, and do not expect to gain financial freedom until the age of 67.

As part of it’s 3GB campaign to unearth the financial interdependencies between three generation Britain, engage Mutual Assurance asked a GB representative sample of 2,298 parents when they expected to be able to afford common life-stage goals including buying a second home and retiring and when they anticipated no longer supporting their children financially. The results reveal how parents’ expectations change as financial reality hits.

Parents Supporting Children

45 percent of over 50 year olds are still supporting their children financially, almost one in ten (9%) expecting to be bank rolling their kids beyond 60.

The average British parent anticipates providing financial support to their children until the age of 59.

Parents in the West Country expect to be bank rolling their offspring for the longest, anticipating reaching the age of 65 before cutting the purse strings, compared to parents in Lancashire who are most optimistic, expecting not to support the kids past 57.
Parents Delaying Plans

With the realisation that they will be funding kids for longer, British parents are curtailing life stage aspirations. Parents aged 18 to 24 years old anticipate retiring 3 years earlier than 55 to 64 year olds. Furthermore, the proportion accepting that they will never be able to afford to buy a second home increases dramatically with age, 27 percent of 18 to 24 year olds realising that they will never buy a second home compared to 70 percent of 55 to 64 year olds.

Karl Elliott, 3GB spokesperson for engage Mutual Assurance said: “University tuition fees, rising costs of living and house price hikes mean that young people are finding it increasingly difficult to gain financial independence. As a result of this pressure on younger generations, parents are shouldering the financial burden, supporting their children for longer.

“This research shows that the expectations of younger parents are not always realistic. In reality it is likely that they will continue to support their kids financially for longer than they anticipate. It is therefore essential that parents of younger children lay down plans to save little and often in order to ensure that their child’s needs don’t affect their future independence.”