The number of over 50s not just supporting their children, but also their grandchildren, is increasing, as the older generations gift £53bn per year to their families, research from Saga Money has revealed.

The organisation found that 69 per cent of over 50s provide financial support to their children and 57 per cent their grandchildren, while42 per cent are providing support to both generations.

Just under a third of over 50s have gifted lump sums to their children in the last five years, with an average gift of £13,862 per child, while almost a fifth have given their children additional spending money, averaging £1,361 a year.

Alongside the cash injections, grandparents also often frequently provide their children with free childcare. Nearly a quarter of over 50s provide free childcare to their grandchildren – providing, on average, 15 hours each week. Based on average national day nursery costs, this is saving parents an additional £294 each month.

Furthermore, in addition to providing their children with financial support, over a fifth of those over 50 are gifting their grandchildren spending money, totalling an average of £534 per year. Also, just under a quarter of over 50s put away £508 per year for their grandchildren, while 21 per cent of them provide their grandchildren with lump sums for specific items, averaging £3,660 over the last five years and rising to £4,616 for retirees.

Commenting on the findings, Saga Money managing director Jeff Bromage said: “With rising living costs and incomes increasingly squeezed, many grandparents are now being called upon to provide substantial financial support to their wider families. In many cases, in addition to regular cash top-ups, nearly a quarter are providing hands-on support in the form of free childcare.

“As this becomes a growing trend, it is essential that grandparents do not compromise their own finances in order to provide these free handouts. We strongly encourage both parents and grandparents to ensure they are in a viable financial situation to offer this help and are not at risk of subsequently leaving themselves vulnerable.

“However, it’s not all about the financial needs of their family – as many grandparents relish the opportunity to spoil their children and grandchildren – and rightly so. Whilst many have saved hard throughout their lives to ensure they can continue to pursue their passions, many also want to see their families enjoy any financial gifts they can afford to give them. The Bank of Nan and Grandad is often less focussed on the monetary aspect and simply an opportunity for families to spend quality time together – and this is something we hope to see continue.”

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