Parents calling on Bank of Gran and Grandad to give their kids a head start in life
Struggling parents say grandparents could do more to help.
Three quarters of UK parents (76%) are keen to step up support for their children’s financial futures – and could soon be seeking contributions from the Bank of Gran and Grandad to make that happen, according to new research.
The survey of 4,000 UK adults for the Association of Investment Companies (AIC)1 reveals that three in five UK parents (60%) currently feel anxious about their children’s financial futures – and almost half (48%) believe their own parents could be doing more to help.
“The Bank of Gran and Grandad could make an even bigger difference if grandparents tapped into the potential of the stock market to grow money over time.”
Annabel Brodie Smith, Communications Director of the Association of Investment Companies (AIC)
Expectations of the Bank of Gran and Grandad are highest among younger parents: 60% of Gen Z parents (aged up to 27) would like grandparents to provide more support for their children’s financial futures, and more than half (55%) of Millennial mums and dads (aged 28 to 43).
Better-off parents expect more help: 54% of parents in white-collar jobs (social grades ABC1) think their parents could do more to help, compared to 34% in blue-collar professions (social grades C2DE).
But some grandparents may be keeping their powder dry. One in five grandparents (20%) say they are likely to help their grandchildren with a major purchase, such as a car, while slightly fewer would be likely to help with a house deposit (17%) or paying for a wedding (15%). Only 12% of grandparents say they would be averse to doing more to support their grandkids’ financial futures.
The research was commissioned by the AIC to support the launch of its ‘Futureproof Your Family’ campaign, which aims to encourage families to talk candidly about their finances and share financial know-how across the generations.
Investing for grandchildren could transform their financial futures and leave a life-changing legacy. If a grandparent had invested £1,000 into the average investment trust2 20 years ago, that investment would now be worth £8,608.
Yet grandparents are not typically big investors, preferring to hold their money in savings accounts (62%) and cash ISAs (39%), with only 13% of grandparents holding stocks and shares ISAs.
Annabel Brodie Smith, Communications Director of the Association of Investment Companies (AIC), said: “Millions of grandparents across the UK would like to do more to support their grandchildren’s financial futures. One in five we surveyed think they could help their grandchildren with major life purchases, such as buying a car, while around one in six think they could support their grandchild’s house deposit or wedding costs.
“The Bank of Gran and Grandad could make an even bigger difference if grandparents tapped into the potential of the stock market to grow money over time. For example, an investment in the average investment trust 20 years ago would have grown more than eightfold by now. Stock market investing does involve risk but over long periods it can turbocharge your savings – so the earlier you start, the better.”
The AIC seeks to inform the public about the benefits of investment trusts through its website, theaic.co.uk and its annual private investor event, the Investment Company Showcase. The Showcase is being held this Friday on 11 October at 133 Houndsditch, near London’s Liverpool Street station. It’s an opportunity to hear directly from over 30 fund managers who are investing in some of the world’s most exciting companies and sectors from the UK and emerging markets to renewable energy infrastructure and the latest in cutting-edge tech.
The Showcase is free to attend in person or online with the use of promotional code SHOW24 and places can be reserved here. All the sessions will be available on demand from theaic.co.uk after the event.
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Notes to editors
- The research was conducted by Opinium, with fieldwork carried out between 20 September and 25 September 2024.
- Average investment trust, excluding VCTs. Source: theaic.co.uk / Morningstar.
- The Association of Investment Companies (AIC) represents a broad range of investment trusts and VCTs, collectively known as investment companies. The AIC’s vision is for closed-ended investment companies to be understood and considered by every investor. The AIC has 324 members and the industry has total assets of approximately £271 billion.
- For more information about the AIC and investment trusts, visit the AIC’s website.
- Disclaimer: The information contained in this press release does not constitute investment advice or personal recommendation and it is not an invitation or inducement to engage in investment activity. You should seek independent financial and, if appropriate, legal advice as to the suitability of any investment decision. Past performance is not a guide to future performance. The value of investment company shares, and the income from them, can fall as well as rise. You may not get back the full amount invested and, in some cases, nothing at all.
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