Grandparent Giving: looking after your grandchildren (and children).

Grandparent giving can be substantially enhanced with relatively little expense by the use of trusts, but this Press Release is about the virtues of Equity Release.

New research reveals extent of Grandparent giving.

  • One-fifth of grandparents in England aged 50+ gave money to grandchildren – totalling over £647million in 2010.
  • Grandparents who give are more likely to be homeowners than renters and more likely to have lower or no mortgage debt.
  • Caring for grandchildren increases the likelihood of giving money to them.

New research by the International Longevity Centre-UK (ILC-UK), supported by Key Retirement Solutions and Partnership, highlights how grandparents are playing a vital role in supporting the financial wellbeing of future generations.

This research is explored in a new report entitled “Grandparental Generosity” which looks at the levels and patterns of financial support from grandparents using the 2010 wave of the English Longitudinal Study on Ageing (ELSA).  The research reveals that:

  • Just under 2.5 million grandparents in England aged 50+ (one in five) gave money to their grandchildren.
  • Contributions to Child Trust Funds (CTFs), tax-free savings accounts for children available from 2005-2010, were made by a small percentage (3.99%) of grandparents;.
  • Across England, grandparents gave a cumulative total of almost £333.8 million to their grandchildren in 2010. Contributions to CTFs were of a similar amount, at £313.8 million in total.

The report paints a picture of which grandparents are more likely to give financially to their grandchildren.

  • A higher proportion of grandparents aged 75-79 gave than from any other age group and 80-84 year olds gave the highest amount on average.
  • Grandparental givers are also more likely to provide care for their grandchildren, and be female and married rather than separated or divorced.

Grandparent givers are wealthier than non-givers.

The research reveals that grandparental givers are typically well-off relative to non-givers reporting higher levels of income and financial wealth.  They also had substantially higher income from annuitised sources like private pensions. Degree holders gave a much larger amount on average compared to the other groups.

Brian Beach, Research Fellow at ILC-UK said, “This research reveals that millions of grandparents are providing financial support to younger generations. For grandchildren, these transfers are likely arriving at a crucial transition point, impacting educational and housing opportunities. As people live longer and society ages, grandparent giving may have an increasingly important impact on the social mobility of grandchildren.”

Ged Hosty, Managing Director of Equity Release at Partnership, said:  “As families become increasingly financially stretched and time-poor, grandparents are stepping in more and more to provide support.  However, while this trend is to be welcomed as it helps to draw families closer together, it can put a strain on the grandparents finances that they may struggle to recover from.

“Therefore, it is vitally important that people consider all their assets – including their homes – ahead of retirement and take steps to ensure that they can provide as much help as needed without detriment to their own retirement aspirations.”

Dean Mirfin, Group Director, Key Retirement Solutions said “It is evident that with extended generations increasingly amongst today’s population that grandparents are opting to help with their grandchildren, not just in terms of time but also financially.

“Grandparents in many cases are taking a pragmatic view with regard to this financial support seeing it as inheritance at a time when money is needed most or has the potential to most influence the financial well-being of the rest of their families. For many being there to witness the impact of their support is a key driver to gift at the right times, and to direct how that support is used, and this is a trend we expect to see continue.”


The Report “Grandparental Generosity: Financial transfers from grandparents to grandchildren” will be launched at an event at the House of Lords on Tuesday, 15 October and will then be published on the ILC-UK website on Wednesday, 16 October 2013.

The English Longitudinal Study of Ageing (ELSA) is a large-scale longitudinal panel survey of people aged 50 and over living in private households in England.  The sample is nationally representative of the population aged 50 and over who live in private households in England. The initial sample, surveyed in 2002-2003, contained 18,813 eligible individuals. Due to the shifts in the age profile of the sample as time passes, refreshment samples have been periodically added.

Just over two-thirds of the population aged 50+ were grandparents (12.2 million people).

Research published by IC-UK on behalf of Key Retirement Solutions on 9th October revealed that: Up to 1.7 million grandparents expect to have to contribute towards university fees and around 364,000 grandparents have already contributed. The nationwide study found just under three per cent of grandparents have already helped fund fees – but that number is set to rocket to nearly 13% over the next 10 years.*

Consumer Intelligence interviewed 2,072 parents and grandparents for Key Retirement Solutions between August 16th and 20th 2013