A new report from Scottish Widows Savings and Investments has revealed an increasing financial reliance among young adults on their parents. In the wake of the economic downturn, the report claims the youngsters are finding it harder than ever to get a job, and are having to borrow from parents and grandparents to service debts and pay living expenses.
Nearly half of parents with children questioned as part of the report admitted to giving money or loans to their adult children or grandchildren. Dubbed the savings sap, the amount given or lent by parents to children has risen from £11,800 last year to £13,660 this year.
The report does not include money spent by parents funding their children through University education or to help them buy a first car . Instead, it highlights the debt problems among young adults and the drain that this has on parents' finances, with 22 per cent of parents having to cut back on day to day spending as a result of giving handouts to their children. It is also harder to parents to maintain regular deposits into a savings account .
The cautious approach of banks to approving credit has prompted fears that the trend may get worse, with hefty deposits required to secure a mortgage, and high interest rates on mortgages for those who can obtain one.
Young Adults Banking on Parents for Support
Financial Services > e-banking > Banking news
Young Adults Banking on Parents for Support
Wed, 03 Mar 2010
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