You are here: Home - Saving & Banking - News -

Parents stop saving for their kids once they start school

Written by:
Many UK parents stop saving or investing for their children once they reach school age, new research suggests.

Two-thirds (67 per cent) of parents set money aside for their children from the time they’re born to the age of three. But by the time kids reach secondary school age, this number has dropped to just 54 per cent, according to research by Boring Money.

Analysis by the research firm found ditching the saving or investing habit when children are so young could be costly.

Its calculations show that investing for a child from birth but stopping after age three could leave them with a pot worth £6,668 by the time they reach 18, based on a £1,000 annual investment and a 5 per cent growth rate.

But maintaining a regular investing habit throughout their childhood leaves a pot of £28,247 at age 18, a difference of more than £21,500.

Meanwhile, the survey of more than 4,000 people found around a fifth (18 per cent) of grandparents put money into accounts on behalf of grandchildren, with the proportion increasing slightly to 22 per cent for grandchildren of school age.

Mothers are significantly more likely to contribute to savings and investment products on behalf of children than fathers.

Holly Mackay, chief executive of Boring Money, said: “This research confirms a broader truism – life events trigger action when it comes to savings and investments. The responsibility of having a baby is a huge catalyst for sorting out our affairs.

“It’s interesting that grandparents are increasingly likely to save or invest for the grandkids as they get older, not displaying the same immediacy evidenced my new parents.”


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.

The savings accounts paying the most interest

It’s time to get your finances in shape, and moving your cash savings to a higher paying deal is a good plac...

Everything you need to know about being furloughed

Few people had heard of ‘furlough’ before March 2020, but the coronavirus pandemic thrust the idea of bein...

The experts’ guide to sorting out your personal finances in 2021

From opting to ‘low spend’ months to imposing your own ‘cooling-off period’, industry experts reveal t...

What will happen if rates change

How your finances will be impacted by a rise in interest rates.

Regular Savings Calculator

Small regular contributions can build up nicely over time.

Online Savings Calculator

Work out how your online savings can build over time.

Having a baby and your finances: seven top tips

We’re guessing the Duchess of Cambridge won’t be fretting about maternity pay or whether she’ll still be...

Protecting family wealth: 10 tips for cutting inheritance tax

Inheritance tax - sometimes known as 'death tax' - can cause even more heartache for bereaved families. But th...

Travel insurance: Five tips to ensure a successful claim

Ahead of your summer holiday, it’s important to make sure you have the right level of travel cover or you co...

Money Tips of the Week