Open-handed Grandparents

Generosity shows no sign of stopping

Forget the headlines about post–pension freedoms with retirees spending their nest egg on a Lamborghini – new research shows that 2.4 million UK grandparents[1] have either withdrawn money from their pension to support their grandchildren or plan to in the future.

According to new research from LV=, a quarter of generous grandparents (25%) who have already given away money to their grandchildren[2] have taken the funds from their pension. A further one in six (16%) plan to use their pension for this reason once they reach retirement age.

Substantial amounts
Open-handed grandparents are willing to give away substantial amounts to their grandchildren, whether from their pensions, savings or wages, with the average grandparent having already spent £1,633. More than one in twenty (6%) have given gifts of more than £10,000.

The generosity shows no sign of stopping, with many grandparents (56%) planning to give away even more money in the future. The average grandparent expects to give away £2,938 in the coming years, with charitable grandmas expecting to give away £173 more than grandads on average.

‘Living inheritance’
Pension savings are used to help with a wide range of things, from helping grandchildren get on the housing ladder (21%) to other high-ticket items such as university fees (20%) or cars (17%). A similar number would help out with more day-to-day expenses like bills (21%) and hobbies (19%).

Grandparents often view the financial gifts they make as a ‘living inheritance’, with more than a third (37%) wanting to be around to see their grandchildren enjoy the money[3].

With one in five retirees using their pension to help out, it’s important to plan for retirement and have enough money left for yourself, as even smaller outgoings such as bills can become harder to meet later in life, as well as the flexibility to access your money.

Source:
[1] According to ONS Population Pyramid, there are 49,533,900 people aged over 18 in the UK. The research found that 39% of a sample of 2,002 adults were grandparents, indicating there are 19,318,221 grandparents in the UK. 56% of grandparents have helped or plan to help their grandchildren, and 22% of these would use their pension to do so. Therefore, 2.38 million grandparents have helped or plan to help their grandchildren, using their pension.
[2] According to research carried out by Opinium Research on behalf of LV=, 25% of grandparents have already taken money from their pension to give to their grandchildren.
[3] Statistics from research carried out on behalf of LV= by Opinium Research in June 2014 (total sample size = 2,043). The press release for this research was issued on 20 June 2014.
The research was carried out by Opinium Research from 13–16 October 2015. The total sample size was 786 British grandparents over the age of 30, and the survey was conducted online. Results are weighted to a nationally representative criteria.

YOUR HOME MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON YOUR MORTGAGE. WILL WRITING IS NOT REGULATED BY THE FINANCIAL CONDUCT AUTHORITY.

LMJ Financial Management Ltd is authorised and regulated by the Financial Conduct Authority to provide investment advice and is bound by its rules.

The material on the site is the copyright material of LMJ Financial Management Ltd. You may not copy, reproduce, republish, disassemble, decompile, reverse engineer, download, post, broadcast,transmit,make available to the public, or otherwise use LMJ Financial Management Ltd's content in any way except for your own personal, non-commercial use. This includes, but is not limited to all individual fund manager data such as rankings or fund managers and ratings of fund managers. LMJ Financial Management Ltd does not accept any liability for your reliance upon, or any errors or omissions. Any other use of LMJ Financial Management's content requires the prior written permission of LMJ Financial Management Ltd.

LMJ Financial Management Ltd, Upper South Hall, Bullen Farm Business Centre, Bullen Lane, East Peckham, Tonbridge, Kent, TN12 5LX
Tel: 01732 874111 Fax: 01732 874222 Email: lmj@lmjfs.co.uk

©2013 LMJ Financial Management 2013.
Cookie Policy
l Privacy Policy l Disclaimer

 

HTML5 Powered with CSS3 / Styling, and Semantics