UK grandparents have a total worth of £5 trillion - and half plan to pass wealth to their grandchildren

Published by Stephen Little on 27 September 2018.
Last updated on 27 September 2018

Despite grandparents having a total net worth of over £350,000 on average, a fifth are still not debt free, new research shows.

According to Charter Savings Bank, grandparents are collectively worth over £5 trillion – the equivalent of £350,634 each.

The main source of their wealth is from property, which is worth £225,623 on average and accounts for almost two-thirds (64%) of the value of their assets. 

Pension pots (£32,652), investments (£32,013) and bank savings (£29,725) are the other major sources of wealth.  

However, many of them are still not 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, mainly due to outstanding mortgages of £11,130, with £2,211 in unsecured debt through loans and credit cards. 

There is good news for first-time buyers unable to get on the property ladder because of sky-high property prices, with half (50%) of grandparents planning to pass down their wealth to their grandchildren.

Three-quarters (74%) of grandparents said they were looking to pass down their wealth to their children.

Paul Whitlock, director of savings at Charter Savings Bank, says: “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.”

In a sign of how many pensioners are sharing their money with younger generations, two in five (40%) grandparents are either already gifting cash to their children and grandchildren or plan to do so. 

Despite owing much of their wealth to being part of the property-owning generation the study found half (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.

Over half (56%) of grandparents believe they are worth more now than their parents were at the same age compared to a quarter (25%) who think they’re worth less now than their parents.

Whitlock says: “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.”

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A very balanced article which

A very balanced article which acknowledges the sacrifices that baby boomers have made to provide for their children and grandchildren. It is important that that support, financial and material, goes to the purpose for which it was intended and is not looted by various foundations and think tanks to redress the ails of society. I am not sure that the term property wealth has any true validity except on death and it is noted that the first claim on that is by the Treasury at the rate of 40%.