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Generous grandparents saving for their grandkids

Generous grandparents saving for their grandkids

Category: Savings

Updated: 03/10/2016
First Published: 03/10/2016

A study by Scottish Friendly has revealed that it's not just friendly Scottish grandparents who are wishing their grandchildren the best, as the majority (51.2%) of grandparents throughout the UK are planning to save up for their grandkids' future.

The average gift these generous grandparents are hoping to leave behind is £10,225. Many hope that this will help their loved ones step onto the property ladder, or help with paying for their higher education.

The figures, which came out this weekend to coincide with Grandparents' Day, further revealed that 31.3% of grandparents plan to save up their gift using cash, whether in the form of a cash ISA or traditional savings account. In recognition of the heightened risk that comes with these accounts, only 4.6% said they would save through a stocks and shares ISA.

While it is specifically designed to be used for children's savings, only 12.8% said they would be using a Junior ISA to save. This may be because traditionally only parents or legal guardians are able to open a Junior ISA. However, Scottish Friendly has created a unique solution that will allow a single ISA to be split up into different pots for each grandchild. Since people are allowed to have two ISAs, grandparents are furthermore still able to have their own ISA pot as well.

Calum Bennie, savings specialist at Scottish Friendly, said: "So many grandparents want to give their grandchildren a real helping hand for the start of their adult life. However, they are often being prevented in doing so as they can't set up a Junior ISA account on their behalf. They have to rely on their own children to open one before committing to save and we are seeing that delays in doing that is creating very real frustration among grandparents who feel they have to coerce and cajole parents to start a savings pot."

Are you a grandparent with every desire to save for your grandchild's future, but no idea where to start? Take advantage of the competitive savings rates on longer-term accounts – the longer you choose to set money aside without touching it, the higher the rates tend to be. Compare savings rates to find the best deal.

Disclaimer: Information is correct as of the date of publication (shown at the top of this article). Any products featured may be withdrawn by their provider or changed at any time.

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