You are here: Home - Retirement - Retiring now - News -

A third of this year’s retirees still financially support family members

Written by: Paloma Kubiak
One in three people planning to retire this year still help out their families financially to the tune of hundreds of pounds a month.

This year’s retirees hand out £260 a month on average to dependants, according to research by Prudential.

They are most likely to help children and children’s partners (45%), followed by grandchildren and their partners (24%). Some still support their own parents (9%) and a surprising 5% help out their grandparents.

The research revealed retirees provide financial support to help family cover everyday living costs (22%) as well as paying some or all of regular household bills (14%).

A fifth who support dependants also help pay for one-off large purchases such as a holiday or a new car and 11% cover non-essential costs such as club memberships and subscriptions.

Nearly one in every 14 of those providing financial support do so to pay for housing costs, most likely for their younger dependants, and a similar figure help to pay for long-term care for their older dependants.

Although new retirees’ incomes are squeezed by providing financial support to dependants, this isn’t stopping them from expecting to leave an inheritance.

Just over one in three (34%) plan to leave an inheritance, up from 28% among last year’s retirees. They expect to bequeath £173,000 on average.

Kirsty Anderson, a retirement income expert at Prudential, said: “With life expectancy increasing rapidly it is not unreasonable to expect the members of the Class of 2017 to be looking forward to a retirement that will last 20 years. However, for those providing financial support to their dependants it is likely to cost them an average of £62,000 over the course of their retirement – accounting for a significant proportion of their pension pot and impacting the income they can expect to live on.

“The money you give to support your loved ones is an element of retirement budget planning that is easy to overlook, and when looking to understand the likely amounts of money you’ll need in retirement, the help of a professional financial adviser or independent guidance from the likes of the Pensions Advisory Service could prove to be invaluable.”

Anderson added that for most people who are still in work it is never too late to make a difference to the quality of retirement you can look forward to.

“Saving as much as possible as early as possible in your working life should give you the best possible opportunity to build a substantial pot to support you and your family in the future,” she said.

There are 0 Comment(s)

If you wish to comment without signing in, click your cursor in the top box and tick the 'Sign in as a guest' box at the bottom.

How to get 7% interest without tying up your savings for years

You don't have to lock your money away for years to get above-average returns on your savings.
How to get 7% interest without tying up your savings for years

Government looks to ‘abolish’ leasehold this year

Michael Gove, secretary of state for the Department for Levelling Up, Housing and Communities, has suggested t...
Government looks to 'abolish' leasehold this year

130 million old £1 coins still out there: what to do if you have one

An estimated 131 million old round £1 coins have yet to be returned to the Royal Mint, nearly three years afte...
130 million old £1 coins still out there: what to do if you have one

Ryanair jetting towards US flights for £10

Ryanair is on course to achieve its long-held ambition of offering transatlantic flights to the US – and the...

Investing in car parks: a good vehicle for income seekers?

As the search for income continues, many investors are turning to alternatives, with car parks becoming increa...

A quick guide to guarantor loans – in association with Guarantor Loan Comparison

Considering a guarantor loan or becoming a guarantor yourself? Read our essential guide...

Results round-up: Companies to watch this week

Mulberry and more will face the music this week.

Product launches of the week

Select Property Group, Schroders, Leeds Building Society and more have exciting news this week.

Money Tips of the Week