Monday, March 15, 2010
Category:
Personal Finance Tips
According to Scottish Widows, young adults have been affected by the economic downturn – so much so that they have become more reliant upon the support of their parents than ever before.
Research has shown that 47 percent of parents with children over the age of 16 have either given or lent money to their adult children or grandchildren. Though this figure is reportedly 9 percent less than that recorded in 2009, the average sum of money involved has increased from £11,800 to £13,660. Therefore it would seem that parents who are in a position to help out financially are parting with more money.
It was found that 35 percent of young adults are turning to their parents for money to fund ‘day to day spending and living expenses’. Additionally, it was revealed that 38 percent require the money for debt repayments, whilst 34 percent need it to purchase a property. One in ten young adults are also reportedly using their parents’ or grandparents’ money to fund training courses in a bid to embark upon a new career.
The research showed that 82 percent of parents who have given money to their relatives have had to turn to their savings to do so, and 54 percent do not believe that they will be able to top their savings back up. Furthermore, it was discovered that 22 percent of parents who have handed money to their children are having to reduce their day to day spending. In addition, one in ten have had to increase their own borrowings – including mortgaging or re-mortgaging their property. In relation to spending, 31 percent are not setting as much money aside and 12 percent have completely stopped doing so.
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Parent homeowners who are juggling their finances, perhaps due to several credit card repayments each month, could consider taking out a secured loan for
consolidation. One of many finance options available, a secured loan for consolidation could allow borrowers to tie up multiple monthly credit repayments into one place. By taking this approach, borrowers could eliminate the juggling act whilst potentially reducing their outgoings. However, if opting for a secured loan to consolidate existing credit, it should be remembered that consolidating your debt may increase the amount you pay back overall and extend the repayment periods of your debts.
