UK parents struggling to save for children’s financial futures, study shows

Sixty-five per cent of parents in the UK are missing out on tax-free savings aimed at giving their children a savings boost, research from Janus Henderson Investment Trusts has suggested.

More than seven in 10 parents (72%) who have children under 18 regularly save money towards their child’s future, but the findings also showed that one in five (20%) have either reduced or halted saving over the past 12 months.

Janus Henderson’s research was based on a study of 1,219 parents in the UK, and examined how parents are saving and investing for the future, as well as what impact the rising cost of living has had on their finances. It found that parents are often keeping savings in physical cash (39%) or in low-interest savings accounts (48%).

Just three in 10 parents are saving money for their children in a Junior ISA (JISA) account (30%), 26% are saving into a cash ISA, and less than a quarter (22%) are opting for a stocks and shares account when saving for their children’s future.

Head of investment trusts at Janus Henderson, Dan Howe, commented: “One theme that emerges clearly from the data is that, a big majority of parents are able to save regularly for their children, and are doing just that, but that comes with considerable sacrifice.

“The cost of living crisis has exacerbated this situation further – yet parents need to be made aware of the savings vehicles available to them, to ease the financial pressures they are facing.”

The Janus Henderson research also suggested that many parents are still struggling with finding the help they need to navigate the financial challenges of parenthood.

According to the findings, 23% of parents wish they had waited to have children until they were earning more money as a household or until they saved more money (22%). The expense of having kids has also impacted people planning their families, with over a fifth of parents (21%) stating that they have chosen to have fewer children than originally planned.

In terms of getting help to manage the finances of being a parent, just 38% of parents said there are enough resources easily accessible to them. For parents with children under 18, the figure rose to 42%.

“It is so important that parents take steps to ensure they are making the absolute most out of these savings,” Howe added. “It can seem daunting to start investing during times of market turmoil, but with a considered financial plan, it can make a real difference.

“Many parents’ long-term saving goal is to be able to support their child later on in life, whether that be helping them with university fees or in getting on to the property ladder.

“Fortunately, these longer-term goals provide parents with a lengthy time-horizon over which to invest. Any sort of regular investment, regardless of its size, can be truly impactful when left over this kind of time-period. There are also many investment options which offer the potential for a very welcome additional income stream to add to that savings pot.”

    Share Story:

Recent Stories


FREE E-NEWS SIGN UP

Subscribe to our newsletter to receive breaking news and other industry announcements by email.

  Please tick here to confirm you are happy to receive third party promotions from carefully selected partners.


The UK housing market in 2024
The performance of the UK housing market in 2024 has largely exceeded many people's expectations, although challenges remain for first-time buyers due to house prices increasing and a testing rental market for many. Regional disparities, such as the North-South divide, also continue to influence housing accessibility and affordability for many buyers in pockets of the country.

Intergenerational lending
MoneyAge News Editor, Michael Griffiths, hosts Family Building Society BDMs, Amar Mashru and Arif Kara, to discuss intergenerational lending and explore ways that buyers can use family income to help increase their borrowing capacity when applying for a mortgage

Helping landlords make their cash work harder
MoneyAge Editor, Adam Cadle, talks to Family Building Society BDMs, Arif Kara and Nathan Waller, about the resilient BTL market, the wide variety of landlords that Family Building Society caters for, and how niche products like an Offset mortgage can help improve cashflow.