SunLife’s latest Cash Happy report has found that parents and children are banking on financial support from each other.
While 17% of 55-65s were found to be expecting to be supported financially by their grown up kids when they retire, 19% of adult children are relying on inheritance from their parents (up from 17% last year).
In addition, one in 10 grown-up children are relying on this inheritance so much that they think their parents are spending too much of it.
SunLife’s research also finds that this financial ‘tug of war’ is affecting many people’s lives now, with a fifth of 18-34s are providing financial support to their parents, while one in seven 55-65 year olds are providing financial support to grown up children no longer in education.
However, while 80% of the 18-34s who are finically supporting their older parents are finding it a struggle, with half of those saying it is a constant struggle, 63% of the 55-65s who support adult children find it a struggle, and only one in seven of those find it a constant struggle.
SunLife said this may be explained by the fact that, as a percentage of income, older people are better off than younger generations; those age 55-65 have 37% of their income allocated to fixed costs, compared to 39% for 18-34 year olds.
Ian Atkinson, head of brand at SunLife, said: “We’re seeing an older generation with high home ownership spending their savings, investments and income on enjoying the best years of their life, knowing they can still leave their home as a legacy.
“It’s not really fair to call them ‘SKIers’ (Spending Kid’s Inheritance) – it’s their money in the first place, and perhaps it’s only right that, when they’re reaching an age of more free time and fewer responsibilities, they’re using that money to fulfil some lifelong ambitions.”
With life expectancy now at 79 for men and 83 for women, those in their 40s and 50s who are ‘expecting’ an inheritance could be waiting a long time. Analysis by The Telegraph revealed that in 1999, the average Briton who inherited money was aged just under 53, now it is rapidly approaching 60.
“Many of us our leaving our financial futures uncertain by assuming we will benefit from some sort of financial support from our families rather than making financial plans of our own,” said Atkinson.
“SunLife’s Cash Happy report shows that on average, UK households have £441 in spare cash each month – which is the equivalent of £44 spare per person per week. If you put just some of this aside each month, you can make a really big difference to your finances.”
