UK parents struggling to save for children’s financial futures, study shows

Sixty-five per cent of parents in the UK are missing out on tax-free savings aimed at giving their children a savings boost, research from Janus Henderson Investment Trusts has suggested.

More than seven in 10 parents (72%) who have children under 18 regularly save money towards their child’s future, but the findings also showed that one in five (20%) have either reduced or halted saving over the past 12 months.

Janus Henderson’s research was based on a study of 1,219 parents in the UK, and examined how parents are saving and investing for the future, as well as what impact the rising cost of living has had on their finances. It found that parents are often keeping savings in physical cash (39%) or in low-interest savings accounts (48%).

Just three in 10 parents are saving money for their children in a Junior ISA (JISA) account (30%), 26% are saving into a cash ISA, and less than a quarter (22%) are opting for a stocks and shares account when saving for their children’s future.

Head of investment trusts at Janus Henderson, Dan Howe, commented: “One theme that emerges clearly from the data is that, a big majority of parents are able to save regularly for their children, and are doing just that, but that comes with considerable sacrifice.

“The cost of living crisis has exacerbated this situation further – yet parents need to be made aware of the savings vehicles available to them, to ease the financial pressures they are facing.”

The Janus Henderson research also suggested that many parents are still struggling with finding the help they need to navigate the financial challenges of parenthood.

According to the findings, 23% of parents wish they had waited to have children until they were earning more money as a household or until they saved more money (22%). The expense of having kids has also impacted people planning their families, with over a fifth of parents (21%) stating that they have chosen to have fewer children than originally planned.

In terms of getting help to manage the finances of being a parent, just 38% of parents said there are enough resources easily accessible to them. For parents with children under 18, the figure rose to 42%.

“It is so important that parents take steps to ensure they are making the absolute most out of these savings,” Howe added. “It can seem daunting to start investing during times of market turmoil, but with a considered financial plan, it can make a real difference.

“Many parents’ long-term saving goal is to be able to support their child later on in life, whether that be helping them with university fees or in getting on to the property ladder.

“Fortunately, these longer-term goals provide parents with a lengthy time-horizon over which to invest. Any sort of regular investment, regardless of its size, can be truly impactful when left over this kind of time-period. There are also many investment options which offer the potential for a very welcome additional income stream to add to that savings pot.”

    Share Story:

Recent Stories


FREE E-NEWS SIGN UP

Subscribe to our newsletter to receive breaking news and other industry announcements by email.

  Please tick here to confirm you are happy to receive third party promotions from carefully selected partners.


Helping the credit challenged get mortgage ready
A rising number of borrowers are finding it harder to access mortgages due to being credit challenged - whether that’s from historic debts, a county court judgment, or having little to no credit history.

In the latest episode of the Mortgage Insider podcast, Phil Spencer is joined by Eloise Hall, Head of National Accounts at Kensington Mortgages, and Alastair Douglas, CEO of TotallyMoney.


Inside the world of high net worth lending
The mortgage market continues to evolve, and so too does the answer to the question: what is a high net worth individual in today’s market? In this episode of the Mortgage Insider podcast, host Phil Spencer is joined by Stephen Moroukian, Head of Product and Proposition for Real Estate Financing at Barclays Private Bank, and Islay Robinson, founder and CEO of Enness Global. Together, they explore what brokers really need to know when supporting high net worth individuals.

The future of the bridging industry and the Autumn Budget
MoneyAge content editor, Dan McGrath, is joined by head of marketing at Black & White Bridging, Matt Horton, to discuss the bridging industry, the impact of the Autumn Budget and what the future holds for the sector.