Bank of Grandma and Grandad; a rising phenonemon?
A recent study by Santander Mortgages found that 8% of first-time buyers now rely on the "bank of Gran and Grandad" to help with a deposit, a four-fold increase compared with five years ago.
In 2016, we commissioned a similar survey that found that more than half (52%) of grandparents in the UK are giving money to families, costing them on average £571 a year. It also revealed that 54% of over 55s have given a one-off lump sum to a family member over the past five years. One in seven (14%) of those that have given a lump sum to a family member have given more than £10,000.
Mark Neal, Managing Director at Homewise, said “Our research reveals the extent to which grandparents in the UK are being relied upon for money and time by children and grandchildren.
Helping family is important to many but it is worrying if they are suffering as a result. Far too many people in retirement are stuck in unsuitable housing and having to scrimp and save.
We believe that the Home for Life Plan can help by enabling people over 60 to move to a new home under a lifetime lease and release money to not only clear any debts but also allow those in retirement to live happily."
Grandparents in the North East are the most generous - two in three (66%) have given away money to children and grandchildren – the highest number in the UK. 63% of grandparents in the North West have given money while in the West Midlands the figure was 58%.
The generosity costs however - more than a third (35%) of grandparents have had to make sacrifices in order to fund families. Nearly six out of 10 (59%) have cut down on socialising while a quarter (24%) of grandparents do not go on holidays and a fifth (20%) go on less holidays.
Their homes are feeling the strain - 18% have postponed or cancelled refurbishment work on their home while the same percentage have had to cut food bills in order to help children and / or grandchildren.
Our research also revealed that grandparents are not just sacrificing money but also their own time in order to help out family members. More than two in five (42%) grandparents are sacrificing more than five hours a week for free to help family members with activities such as child minding.
The study has highlighted the often selfless sacrifices made by so many grandparents in the UK. Through the Home for Life Plan, people over 60 are enabled to secure homes with savings of up to 59%*. We are aiming to revolutionise the way people approach retirement, avoiding being stuck in unsuitable housing with unmanageable repayments and instead allow them to retire happy.
Not many people know that Homewise is a family-run business, take a moment to learn 6 quick facts about us and our values.
You can use our quick and easy online Budget Booster, to get an estimate on how much you could save from the price of your home for life. It's simple and takes less than 3 minutes. Why not give it a go?
*Savings range from 8.5% to 59% and depend on the customer’s age, personal circumstances and property criteria. Only available to those over sixty years old.