Raising a child is an expensive business as any parent will testify and a recent study put the cost of parenthood at around £218,000 per child, up to the age of 21.
The costs have risen by 55% since the research was first carried out in 2003 and are up by 3.3% on the same time last year.
But once your son or daughter reaches that magical age, graduates from university, the financial burden finally lifts, right? Not according to the latest research.
The economic downturn in the UK has left children increasingly financially dependent on their parents. However, a new study has shown that as many as 4.4 million children aged over 21 still rely on their mum and dad to help them out financially.
Researchers found that over the course of their adulthood, children turn to their parents for help with many so-called ‘big ticket’ costs, such as weddings, property, cars and holidays. The average contribution that hard-pressed parents fork out for these large items comes to £9,476.
But this is not the only cost that parents are increasingly being asked to help out with.
Big kids need more help than ever
Essential living costs, such as rent and household bills, are becoming difficult for many grown up children to meet. The study revealed that parents are handing over an average of £175 per month to their offspring aged over 21, simply to help them pay for their basic needs.
The data collected by LV= showed that most parents were resigned to being a primary means of financial support until their child reached age 38, on average. 1.6 million adults aged over 21 who cannot manage without their parents’ financial support still live at home, with 12% aged over 40 and one in three in their 30s. A third of parents said their grown up child was still living under their roof because they were unable to buy their own home and were reluctant to rent. Approximately 160,000 parents said their children had been unable to move out, because they were still struggling to pay off debts and needed help.
A quarter of all parents who took part in the survey admitted they do not believe their children will ever be able to achieve financial independence.
The average age of a first time buyer in the UK has climbed to 38, but over the next 12 years is expected to rise further, to reach age 41 by 2025.
But the strain of providing support for their children well into their adulthood does not come without a price for parents.
Half of mums and dads with grown up kids said they had plundered their savings in order to help their children and one in ten admitted they now had no money left for their retirement.
Debt charities have said that they has seen an increase in the debts being reported by older people, with many admitting they had got themselves into financial trouble as a result of trying to help out their adult children.
As a parent it can be difficult to ignore your children’s problems but getting yourself into difficulty too will be worse for everyone in the long run.
If you’re struggling to pay unsecured debts, getting help from a professional organisation such as Baines and Ernst may be a better solution.
Baines and Ernst have been helping people since 1996 and – as DEMSA members – follow a code of conduct approved by the Office of Fair Trading. They have a team of experts at the end of the phone who can provide advice about a range of financial solutions which may be suitable.
As well as offering Debt Management Plans, Baines and Ernst can provide advice on Individual Voluntary Arrangements, Debt Relief Orders and even Bankruptcy. Any unsecured debts such as loans, credit cards and catalogue accounts, can be considered for inclusion and your creditors will be asked to agree to a lower rate of repayment, as well as freezing interest.
If debt is becoming a struggle, it’s important that you know that you don’t have to struggle alone. Help is available leaving you free to enjoy your retirement and your children able to gain some financial freedom.