Strategies to save for the grandchildren

GRANDPARENTS and parents worried about children’s financial futures are stashing money away for them, but often not in the best place.

A study by Generation Life found that 93 per cent of grandparents and 97 per cent of parents are concerned, as high property prices and education costs threaten the next generation’s financial security.

It found 47 per cent of parents and 15 per cent of grandparents are saving to help out, and a majority use bank accounts paying low interest.

Generation Life joint CEO Catherine van der Veen said people were not confident that their children would be able to “stand on their own two feet” .

“More than ever, the next generations are going to need help to pay for their education and to get into a house,” Ms van der Veen said. She said the keys to helping out were: • early to harness the benefits of compounding. • to children to educate them financially – “don’t leave it to the banks”. • that the savings

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kept up with rising living costs. One option is investment bonds: long-term products that spread money across a range of assets and deliver tax benefits.

Wealth on Track principal Steve Greatrex said it was important that parents and grandparents looked after their own finances first, and let younger generations “grow their own financial wings”.