Protection  

Unexpected casts doubt on bank of mum and dad

Analysis conducted by the protection provider showed that one in 10 people aged 55 and over have no money set aside for emergency events.

Yet older family members are typically lending £900 more to family members than those aged between 18 and 34, highlighting how much the younger generations rely on parents and grandparents for financial support.

By extrapolation, this could mean that more than 11m Brits are lending money to friends of family members, with 10 per cent having also borrowed money themselves.

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One in five people across all age groups admitted that they have no financial buffer for worst-case scenarios, such as serious illness or the loss of their job.

Jennifer Gilchrist, senior product development manager for Bright Grey, said people should question how secure their own financial position is before lending money to others.

Keith MacDonald, director of Worcestershire-based Broadway Financial Planning, said: “We craft financial planning policy statements for clients that deal with scenarios such as their children getting into debt.

“We ask the parents to consider what they would do – would they pay off the debts or pay for a debt counsellor to tackle the root cause of the problem? We know that parents always want to help their children but they must ensure their own financial house is in order first.”

Key facts

£1447 - typical amount that babyboomers lend to family and friends

9% - the number of over-55s with no financial safety net

£1091 - average amount lent by Britons to loved ones