Parents Increasingly Helping Children To Plan For Their Future – Survey

Stephen Little

17 June 2014

An uncertain financial future is creating anxiety amongst some parents that their children face large debts and won’t be able to secure employment, according to new research from Lloyds Bank Private Banking.

The report, called Family Futures, asked over 1,100 Lloyds Bank Private Banking clients about their views on their children’s futures and revealed that the majority (62 per cent) are concerned for their ability to find a job. Meanwhile 36 per cent worry that their children will not be careful with their money and 34 per cent are concerned about the level of debt they may have.

Nearly half of parents surveyed have made investments on their children’s behalf, with 42 per cent in the form of trust funds and 24 per cent in stocks and shares.

While property is viewed as the best investment among those surveyed for one’s children – doubling the popularity of stocks and shares in terms of opinion (25 per cent versus 51 per cent) – when it comes to actual investments parents have made on behalf of their children it is well down the list at 15 per cent. This is compared to trust funds (42 per cent), stocks and shares (24 per cent) and bonds (22 per cent).

The discrepancy in respondents’ opinions compared to their investment actions could be down to a range of factors including property seen as a long term investment with funds being viewed an easier way to save in small increments or the relatively liquid nature of stocks and shares.

“Although the UK economy is beginning to show strong signs of recovery, many are still concerned about their family’s future and investing early on behalf of their children, usually before they even begin school. While a large percentage of families are investing their wealth in financial products, many still see property as a big investment,” said Sarah Deaves, investment advice and private clients director at Lloyds Bank.

“Our research shows that while the majority of parents are quite clear where they think the best long term investment is for their children’s future, nearly 20 per cent simply don’t know. This suggests that good financial advice is as important as ever, especially with such long-term and important investment decisions,” added Deaves.