- Grandparents’ total net worth adds up to £5 trillion or £350,634 each
- Majority of grandparents say their kids will be better off than them when they reach the same age
- Grandparents hold an average of £29,725 in bank and savings accounts
New research from Charter Savings Bank1 shows grandparents are collectively worth over £5 trillion – the equivalent of £350,634 each – and expect their children and grandchildren to be better off than them when they reach the same age.
Despite owing much of their wealth to being part of the property-owning generation the study found 52% of grandparents believe that their children will accumulate more wealth than them compared to a quarter (25%) who think the younger generation will be worse off.
Grandparents acknowledge that they are worth more now than their parents were at the same age; over half (56%) believe this to be the case versus a quarter (25%) who think they’re worth less now than their parents.
In a sign of how many pensioners are sharing their money with younger generations during their lifetimes, four in ten (40%) grandparents are either already gifting cash to their children and grandchildren or plan to do so. Three-quarters (74%) of parents and half (50%) of grandparents plan to pass down their wealth to their children and grandchildren respectively.
The main source of grandparents’ wealth is their home worth an average of £225,623 which accounts for almost two-thirds (64%) of the value of their assets. Their pension pots (£32,652), investments (£32,013) and bank savings (£29,725) are the other major sources of wealth.
Grandparents are not entirely debt-free – around one in five (19%) still have mortgages on their main home and one in three (32%) owe money on loans and credit cards. On average, they have £14,810 in liabilities predominantly due to outstanding mortgages of £11,130 with £2,211 in unsecured debt through loans and credit cards.
Paul Whitlock, Director of Savings, Charter Savings Bank, said: “Baby boomers may be the richest generation ever, but they are optimistic that their families will in time be better off than them. This may be difficult to believe for millennials struggling to reach the property ladder but much of their grandparents’ wealth will eventually find its way to them either through gifting or inheritance.
“While houses are the biggest source of wealth, the savings accumulated by the average grandparent almost match the size of their pensions and investments, demonstrating the role that a healthy savings habit plays in any balanced portfolio.
“Whether you are lucky enough to be expecting to inherit all or part of your parents or grandparent’s wealth or not, it’s important for people of all ages to make regular cash savings and seek out the best rates to live the lifestyle you aspire to have in later life.”
1 Opinium conducted research among 2,007 adults living in the UK on behalf of Charter Savings Bank between 22nd – 26th June 2018