Data Shows Milennials Rely Heavily on ‘The Bank of Mum and Dad’- Here’s What It Means For You

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As parents, we always strive to do what’s best for our children. We want to wrap them up in cotton wool and protect them from the world, which can be a harsh and sometimes scary place. But our kids have to grow up sometime, and you will remember yourself from being a young adult that it can be tough going. Millennials these days are now poorer than previous generations, houses are more expensive, and there are fewer opportunities than times gone by. The ‘bank of mum and dad’ is widely used to allow people to have the same opportunities, otherwise, they can miss out completely. Thankfully, having savings in the bank can really give your son or daughter the help they need to get through some of the tricky financial times. If you’re a new parent looking to save for your child, based on current trends here are some of the ways they will most likely benefit from your help.

Help Towards Education

Data suggests that parents are willing up up sticks and relocate so they’re closer to better schools. If you’re in a good catchment area, the school is likely to be better, checking annual reports and ratings will tell you exactly where the best schools are. But even if you get your child into a great school, they’re still going to need to go onto higher education- university and college to achieve the best careers. Education is expensive, on top of the main higher education course fees you also have books, living costs and other things to factor in. While there’s always a chance of winning scholarships, if you want your child to attend one of the best colleges then you need to have backup options. Saving for education is one of the top reasons most parents save for their children, and it’s so worthwhile. A good education sets them up for success later in life, and may also give them opportunities that they wouldn’t have had otherwise. It of course massively increases the chances of them getting a great career, the chance to make a difference in the world, earn plenty of money and generally be a success in their lives. Education is never a waste of money, allowing your child to be well educated is one of the greatest gifts parents can give.

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Help Towards a House

Getting a foot on the property ladder is more difficult now than it’s ever been. Many people find themselves stuck in the cycle of rent taking all of their money and then not being able to save. And with house prices going up, and mortgages getting harder and harder to get, buying a house is out of reach for many young people. When Boomers were young, houses were generally around four times their annual income. Today it’s almost double that at seven times their annual income. Twenty-five-to-thirty four-year-olds now are less well off than the same age group a decade ago, and on top of this, every other older age group has significantly increased in wealth. Who knows what the situation could be in a couple of decades when your child reaches the age where they want to buy. Having some savings in place to put towards a deposit can give your son or daughter the boost they need to secure that mortgage- even if they have to save for a while themselves too. Owning their home gives them security, and means everything they spend or invest into it is boosting its value. And isn’t just ‘dead money’ being paid to a landlord each month? Up to 30% of young, first-time homeowners rely on the bank of mum and dad to get onto the property ladder. If this is something

Help Towards Driving Lessons and Their First Car

Even if you’re not able to save enough for college or a house deposit, even a few thousand can really help your child at the start of their adult life. Having money up front to pay for driving lessons, tests and to purchase their first car can be a huge help. It gives them independence and could allow them to study or find better work further out. Plus it’s a useful life skill for anyone to have and so puts them on a good path for the future. A study by Autotrader showed that parents today were more likely to purchase their child’s first car. If this is something you plan on doing, it’s another reason to add money to their sa

Help With Medical Bills

As parents, we don’t ever want anything to happen to our children. But accidents, injuries and health problems can strike down anyone, and if your child or grown up child needs help with things like medical bills or affording an operation or treatment, you of course will want to be able to help them with this. If it’s a criminal case, a criminal defense lawyer will be able to work to gain compensation, but this can take time. Having money available right away will be essential. Health insurance is always a wise purchase, but it doesn’t include everything. Especially when it comes to things like experimental or pioneering surgery (which could be their only option). So having money there to be able to help with this instead of having to rush to sell your home or property is useful. It’s an expense no one wants to plan for, but having savings as a buffer for you, your partner and your children’s health is never going to be a bad thing.

Even if you’re a firm believer that people shouldn’t be handed things and should work hard for what they have, it’s worth saving. Your child will still have to work incredibly hard throughout their life, helping them on these kinds of things will just give them opportunities they might not otherwise have. In some cases it could be the difference between life and death, so it’s worth saving for your child’s future if you’re able to do so.

 

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