Are You Financially Prepared to be a Grandparent?

Even if you are good with your own money, that doesn’t mean that your children are going to follow suit. Whilst every parent tries to instil responsible spending into the psyche of their child from an early age, that doesn’t mean that they won’t need a little monetary help from you as they get older – through teenage years, right up to when they have kids of their own.

Thanks to the growing cost of raising a family, it looks like grandparents are being increasingly called upon to help out in the financial woes of their children and grandchildren. A recent study by RIAS showed that a massive 75% of the UK population are tasked with childminding their grandchildren, saving their sons and daughters from forking out for childcare.

The data revealed that the costs and the time which grandparents must invest into childminding has rocketed, even since 2009. In the last five years, there has been an increase of 61% in grandparent childminders – 26% are dipping into their savings in order to cover the costs of looking after the little ones, and worryingly 1 in 10 grandparents are going into debt as a result.

Feeling the pinch

It’s no secret that the financial climate in Britain right now is chilly, to say the least. It seems that more and more of us need to tighten our purse strings as the cost of living continues to steadily rise, and parents working full time are sure to be grateful for the savings made by choosing grandparent childcare.

According to the research, 12% of parents feel they have no choice but to ask the grandparents for help. A fifth of grandparents believe the rise in their care can be attributed to progressively more expensive formal childcare costs.

RIAS have come up with this infographic to accompany their ‘21st Century Grandparents Study’- are grandparents becoming more relied upon to help out parents in this tough financial climate?

Even if your kids or grandkids are still young, it’s a good idea to start planning for their financial needs throughout their life early. You can learn more about investments and trust funds here.