Credit, Collections & Insolvency News
New research from Engen Group, the UK based innovation and property business focusing on addressing environmental challenges such as affordable and sustainable housing, reveals that 26% of people with adult children have given them money as a ‘gift’ to help them on to the property ladder. A further 7% have provided them with loans to do this.
One in four (24%) plan to provide financial assistance to adult children in the future to help them on to the property ladder, with a minority of 43% saying they haven’t or do not plan to do so.
However, the findings reveal that helping children on to the property ladder adversely impacts the finances and living standards of around 40% of parents who do this. One in five (20%) of those who have done this said they had to cash in savings and investments to help them meet their living costs. Some 19% said they had fewer holidays and 6% claim to have ‘downgraded’ their transport by for example, selling their cars and using public transport instead. Some 4% have had to cancel their membership of clubs.
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Actions parents have taken after they helped their adult children financially on to the property ladder
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Percentage of people who have provided financial assistance to adult children to help them on to the property ladder
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Cashed in savings/investments to help meet living costs
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20%
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Had fewer holidays
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19%
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Ate out less
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12%
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Bought fewer clothes
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9%
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Downgraded transport e.g. sold car and used public transport instead
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6%
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Cancelled membership e.g. sports club
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4%
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Affected me in some other way
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1%
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It didn’t impact my spending at all
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60%
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Graeme Boiardini, CEO of Engen Group said “There is a great deal written about the difficulties facing first-time buyers in securing a foothold on the property ladder, and the money provided by the ‘Bank of Mum and Dad’. However, there is little written about the impact on the standard of living on parents who provide this financial support to their children. The problems created by the lack of affordable housing are much deeper than many realise.”