In recent years, the Bank of Mum & Dad has supported young adults through many of life’s most expensive milestones, from higher education to weddings and buying a home. According to research from the Institute of Fiscal Studies, parents handed out almost £14 billion a year between 2018 and 2020, and analysis from property group Savills found that the Bank of Mum & Dad supported nearly half (49%) of all first-time buyer housing transactions in 2021.
However, our latest Youth Economy Report reveals that over half of parents (52%)* plan to reduce the amount of money loaned or gifted to adult children, and the overwhelming majority of 6-18 year-olds don’t expect parents to contribute to their financial future*.
“I’m hoping to buy my first house when I’m 18. My mum and I watch Homes Under the Hammer in the school holidays, and I’d like to buy a council house, as it’s a bit cheaper, then I can work on it and rent it out for good money. I’m also saving to buy a car. Any five-seater will do, as long as it’s cheap and drives without any problem. It’s important to start saving now as when I’m older I will have to look after myself.”
Theo, age 8
Financial independence
Even though they’re growing up in a time of economic instability, our research indicates that today’s kids and teens are already on track to become the most financially empowered generation in history.
Our latest research* shows that almost three-quarters of young people (74%) don’t expect their parents to help pay for their wedding, 72% don’t expect their parents to help them buy a house, and 64% don’t expect their parents to help foot the bill for the cost of their education, such as paying for university, training or an apprenticeship.
So how are they planning to achieve financial freedom?
More than four in ten kids aged 6-18 (42%) say that recent events like the Covid pandemic and the Cost of Living crisis have made them more likely to start saving early for these big life events – and our data** reveals that GoHenry kids and teens are saving 145% more than they did last year. More than a third (35%) of young people are planning to save to buy a house, and 65% of those who are already saving have put away up to £1,500 for this purpose*.
What’s most impressive is that young people are starting to save well before they hit their teens. GoHenry data shows that 6-10 year-olds are putting more money aside for university, with a savings increase of 11% per child compared to the previous year**.