Bank of Mum and Dad ‘expands’ during pandemic – Rathbone

Fifty-five per cent of parents are planning to financially gift to their children or grandchildren in the coming years, according to new research by Rathbone Investment Management.

The investment manager suggested the Bank of Mum and Dad has “expanded” during the coronavirus pandemic to help their offspring as they face mounting financial concerns.

The findings, based on a nationally representative sample of 501 investors with £10,000 worth of investable assets, also revealed that 45% of investors have prepared to lend to their partner, while a further 29% have planned to financially support other members in their family.

Rathbone also found that some investors have used the COVID-19 pandemic to get their affairs in order and keep their Inheritance Tax (IHT) bill low for loved ones.

The research showed that 44% of investors have already made a will in order to reduce their IHT, while 28% of individuals have also made a financial gift in order to reduce any IHT bill.

Rathbone Investment Management head of financial planning, Emma Watson, commented: “As we continue to face new challenges, with many concerned over their financial health, it’s no surprise the Bank of Mum and Dad has stepped up to offer support to their loved ones.

“With many of us looking to get our finances in order, it’s important to map out how much you can afford to gift whilst bearing in mind your own later life. The value of gifting assets during your lifetime can help to avoid any unexpectedly large IHT bills.

“I’d always advise that people review their will and financial plans regularly, particularly on important milestones as circumstances can quickly change. It’s never too late to draft up your will, and now while in our third national lockdown is a good opportunity to get your house in order.”

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