Mortgage Industry News

← Back

Parents should consider life insurance

Date: Mon, 03 Apr 2006

Many parents are dipping into their savings or taking out loans in order to provide for their adult children, according to a new survey.

Research from asset manager Insight Investment estimated that more than 33 per cent of parents are spending up to £5,000 a year on their grown-up children. The increased cost of university and rising housing prices means that many parents are giving their offspring money to help them secure a degree or step on to the property ladder.

The study discovered that 63 per cent of those aged between 25 and 34 years rely on financial support from relatives, whilst 46 per cent of 35- to 44-year-olds received money from other family members.

However, this could mean that some parents are substantially reducing their savings or even increasing their debt levels and therefore should consider taking out a life insurance policy.

Gordon Phillips, head of retail at Insight Investment, warned: "At a time when empty nesters should be prioritising their own financial independence, many are finding that pressures on the parental pursestrings are eating into their potential retirement pot."

Appropriate life insurance cover would mean that debts are not automatically passed on to their partners or offspring.


© 1998-2005 DeHavilland Information Services plc. All rights reserved.

Endsleigh Insurance Services Limited is authorised and regulated by the Financial Services Authority. This can be checked on the FSA Register by visiting its web site at www.fsa.gov.uk/register.
Endsleigh Insurance Services Limited. Company No: 856706 registered in England at Shurdington Road, Cheltenham Spa, Gloucestershire GL51 4UE.