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Many parents `pushed into debt by adult children`

02/03/2009

A significant number of parents in the UK are falling into debt because they have to provide financial assistance to their adult children, it has been found.

The annual Scottish Widows Savings and Investments Report suggests that 56 per cent of parents have given or loaned their children or grandchildren a substantial amount of money.

According to the firm, the average sum lent was £11,776.

Meanwhile, one in six parents who have loaned money to their children or grandchildren increased their own levels of debt to do so.

In addition, nearly half will not be able to top up their savings to replace the money taken out.

Gordon Greig, head of savings and investments at Scottish Widows, said: "The immediate impact of parents providing funding to their adult children can be detrimental on long term savings and investments.

"Many have had to cut back on saving themselves, reduce their outgoings and even take on additional debt."

Research conducted recently by The Children`s Mutual and the Social Issues Research Centre found that 39 per cent of young adults questioned relied on their parents for contributions to their rent, while 17 per cent were helped out with bills.

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