Almost 3 in 10 parents are forced to remortgage their homes, due to a lack of financial planning for a growing generation of Yuckies (Young Unwitting Costly Kids), according to a new report from The Children’s Mutual.
Just 13% of parents questioned* had saved regularly in preparation for funding their children, while 70% of parents said they had underestimated the cost of providing financial support for their child into young adulthood.
The report found that 28% of parents surveyed have already remortgaged, or are planning to remortgage in order to fund their children in this age group.
These are not younger children – the report deals specifically with financial planning for children in the 18-30 age group, covering the years of university education and helping with first time buyer mortgages as well.
These are the children of the ‘Babygloomers’, a group of parents trapped between generations, and now often contributing to their offspring and their aging parents at the same time.
The Children’s Mutual estimates that the average cost of funding a Yuckie is £30,000.
Many of the parents surveyed also implemented a campaign of domestic cost-cutting and belt-tightening in order to assist their children. Cutting down on their personal food shopping was a measure taken by 28% of parents, while 7% sold their car and 42% cut back on home lighting and energy costs.
“No longer does turning 18 mean financial independence. In fact, 16 per cent of parents questioned expected their child to remain financially dependent on them into their 30s and beyond,” said Children’s Mutual chief executive, David White.
Many of the babygloomer generation would look back and wish they had devoted more resources to child savings, he said.
“The families we questioned had just one message for parents whose children are still young – save, save, save!,” he said.
“More than half agreed that, if they’d known when their child was born what they now know about the cost of having an adult child, they would have saved more through the years.”
* Children’s Mutual survey of 1,484 parents of children over 18
