13% of over 50s currently save money to give to grandchildren
20% of grandchildren will receive nest egg of over £10,000
A third of Brits put money aside for other family members
Despite the difficult economic climate 1.8 million grandparents (13%) are putting money aside for their grandchildren, research from Saga Savings reveals*. A fifth (20%) of generous grandparents are saving £400 or more a year, which would provide their grandchildren with a nest egg of £10,000*** when they turn 18.
A further one in ten (11%) generous over 50s are also saving money for their adult children to help them through these turbulent times, despite many of them being retired and living on limited budgets themselves.
Furthermore, 70% of over 50s have provided financial help to their family over the course of the past fives years in addition to saving on their behalf. Almost half (46%) of worried over 50s have given financial help to their adult children when they have fallen on hard times, and 15% of doting grandparents have helped fund treats such as a new computer or holiday for their grandchildren.
The research also reveals that despite tightening their purse strings, saving for loved ones is still a priority for family-focused Brits, with a third (31%)** of the population actively saving for a family member despite the current climate. Amongst the under 50s, almost a quarter (21%) are stashing cash to fund their children’s school and university fees. Almost one in ten (7%) are also saving for their spouses!
Over half (54%) of grandparents say they save for their grandchildren to help fund them in their adult lives, such as the cost of a university education, career development or getting a foot on the property ladder. Interestingly, grandfathers in particular feel a keen sense of obligation to put money aside for their grandchildren, with over a third (36%) of grandfathers doing so compared with a fifth of grandmothers (22%).
Andrew Goodsell, Chief Executive, Saga Group, concluded: “Despite the current climate our research proves that we are still a financially generous nation when saving for those we love. It's good to know that the prudence and experience of many over 50s has enabled them to support their children and grandchildren who need financial help in these uncertain times.”
The new Saga 4 year fixed rate account offers an attractive interest rate of 4.35% AER significantly higher than other fixed rates accounts currently available, it also allows withdrawals^ before the grandchild turns 18 offering flexibility if needed. The interest rates on Saga’s fixed rate accounts are guaranteed for the term of the account, providing peace of mind that savings are protected from fluctuations in interest rates during the term of the account – something that could be especially important when saving for the long term.
* Saga Populus research, with 19,000 interviews with over 50s across the UK in May 2009.
**Analysis carried out by Opinium Research with 2,009 online interviews with UK citizens between 28th to 30th April 2009.
***Saga Product Management 01/06/09. Assumes monthly contributions of £33.33 and average gross interest rate 3.50%. Figures quoted are gross.
^Withdrawals permitted subject to penalty of 90 days loss of interest on amount withdrawn. Applies to Saga’s 2 year and 4 year accounts only.
There are 14m grandparents in the UK. Source Grandparents Association.
The deposit taker for the Saga Fixed Rate Savings Accounts is Birmingham Midshires, a division of Bank of Scotland plc, which is authorised for accepting deposits by the Financial Services Authority. It is entered on the FSA Register and its number is 169628. Registered office: The Mound, Edinburgh, EH1 1YZ (Registered in Scotland No. SC327000).
‘Saga Savings Accounts’ is a trading style of Saga Personal Finance Limited, which is registered in England and Wales (Company No: 3023493) and is a wholly owned subsidiary of Saga Group Limited. Registered Office: Enbrook Park, Folkestone, Kent, CT20 3SE.
Saga Fixed Rate Savings Accounts are only available to UK residents aged 50 and over.
For more information, please contact the Saga Press Office on 01303 771529.