New research* from Wealthify has found that a quarter of parents in the North East feel they don’t have enough income to save for their children.
A further quarter (25.3%) of North East parents said they would feel guilty if they didn’t save for their children, something many parents can relate to in the current climate.
Looking to the future, a fifth (18.5%) of parents in the North East said they want to save for their children because they know life will be harder for their children than it was for them.
So how are parents in the North East planning to save for their little one’s futures?
The data below outlines how parents are saving for children’s key milstones such as first homes, further education, weddings and first cars:
- First Homes
Parents in the North East were least likely to contribute to their child’s first property purchase, with 40% saying they would not contribute. Comparatively, less than a third (32.8%) of all UK parents said they would not.
- Of the parents in the North East who would contribute, over half (55.6%) planned to spend between £10,000 to £30,000.
- Almost a quarter (22.2%) of parents in the North East said they would splurge between £30,000 to £50,000 – this is the second-highest percentage of parents to spend this much in the UK, just behind London, where 28.6% plan to contribute this.
- Alongside parents in Northern Ireland, parents in the North East were one of the only regions where no respondents said they planned to make the entire house purchase for their child.
- Parents in the North East were found to contribute the second-highest throughout the UK – £26,250. Spending the most on average were parents in London, who plan to fork out £31,541.35. The national average was found to be £24,817.14.
- Over a quarter (28.7%) of parents surveyed in the North East had financial support from their own family members when buying their first home, indicative of the rise in house prices and the need for more support.
- Further Education
With more people attending university in the UK than ever before, it seems parents’ finances are taking a hit too. More than a third (34.5%) of parents in the region will not contribute financially to their children’s higher education – the second-highest in the UK, just behind parents in Yorkshire (34.7%).
- Almost half (47.8%) of parents who said they would contribute, plan to give each of their children between £501 to £2,000 per year they’re in higher education.
- A further fifth of parents said they would contribute between £2,001 to £3,000.
- 1 in 7 (16.8%) parents in the North East said they plan to contribute between £3,001 to £5,000.
- Where about 1 in 8 (12.4%) UK parents said they would spend more than £5,000 per year on higher education, only 1 in 20 (4.9%) parents in the North East said they would spend this much.
- Weddings
The independent research found that just over a third (35.6%) of parents in the North East plan to contribute to their children’s weddings. Just over 33% of parents received help from their own parents financially when they were getting married which interestingly shows that generationally, weddings are still as important to those in the North East.
Of the parents who planned to contribute, 41.9% hoped to spend between £5,000 to £15,000. Comparatively, only about a quarter (26.9%) of all UK parents said they would spend this amount.
- First Cars
Wealthify’s survey found that about half (49.4%) of parents in the North East plan to contribute to their children’s first car purchases, making it one of the most generous regions when it comes to the cost of vehicles – just behind Wales (50.5%), Scotland (50.3%), the West Midlands (50.2%) and Northern Ireland (50%), consecutively.
The survey also found that while UK parents fork out an average of £1,911.75 on a car for their child, parents in the North East are spending slightly less than this with an average of £1,860.47. Comparatively, parents in London spend an average of £2,454.74.
Interestingly, about 1 in 7 (14%) parents in the North East said they would contribute between £3,001 to £5,000 on their children’s first cars, and a further 1 in 21 (4.7%) said they would spend more than £5000.
Simon Holland, Chief Product Officer, Wealthify comments: “As the cost of living rises across the country, it’s no surprise that parents are finding it difficult to save for their children. However, as time goes on, big purchases like a car or home will become much less attainable for our kids – so, it’s important we help to give them a financial head start if we are able to.
“You can open up a Wealthify Junior Stocks and Shares ISA (JISA) to start investing towards your child’s future from as little as £1. What’s more, you can spread the cost by inviting family and friends to contribute. If you don’t think you can afford payments every month, no pressure – Wealthify JISAs are flexible, so you can pay in as much as you like, as often as you like, ready for your child to access when they turn 18.”