Family values: bank of granny and grandad more important than ever for younger generations
The Bank of Mum and Dad is getting older, as families rely increasingly on their elders’ wealth. Four in 10 grandparents hand cash to their families every year, giving an average of £1,475 each, according to Charter Savings Bank. Their donations add up to £21bn a year, not to mention £4.3bn worth of free childcare – but they could better help their grandkids by investing at birth. Brewin Dolphin, a wealth manager, looked at what a yearly contribution of £2,880, the annual exemption for inheritance tax purposes, would build in 18 years. A cash Jisa paying 1.5pc would create a £59,894 pot, a stocks and shares Jisa at 5pc would grow to £85,072, while a child pension paying 5pc would be worth £106,340 by the child’s 18th birthday due to tax relief.