Grandparents are increasingly contributing towards their grandchildren's university costs, according to a new survey.
Grandparents in the UK plan to contribute more than £16 billion towards their grandchildren's studies, according to the research carried out by Saga. It was found that more than a third of the UK's estimated 11.8 million grandparents have helped towards children's university costs, or are planning to.
It appears that the "bank of Mum and Dad" is increasingly becoming the "bank of Nan and Grandad" as parents feel their incomes squeezed. The average grandparent plans to pay out almost £4,000 in total, while 67% of over-50s parents are still contributing an average of £6,777 towards their children's university costs.
The same survey carried out five years ago found that only 41% of grandparents had set money aside for their grandchildren, but the total amount was just £1,000 over five years – almost £3,000 less than they plan to contribute now.
Andrew Strong, Chief Executive of Saga Personal Finance, commented on the findings:
"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."
These figures come as the Prime Minister indicated on Tuesday that the government will look into giving extra help to grandparents who look after their grandchildren, potentially including paid leave and greater financial support. Peter Corfield, Managing Director at RIAS, welcomed the statement:
"It’s great to see the Government acknowledging the vital role that grandparents play in UK family life, and the knowledge and experience they bring that benefits generations. The enormous and selfless contribution today’s grandparents provide must be acknowledged as often the time, energy and experience grandparents give can often mean sacrificing their own plans and ambitions."