Grandparents chip in as the new ‘bank’ for cash-strapped youth

The 'bank of Mum and Dad' is being replaced. Pic Craig Stephen
The 'bank of Mum and Dad' is being replaced. Pic Craig Stephen
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The “Bank of Mum and Dad” is a long-standing institution patronised by many cash-strapped young people, but another group popular among this demographic could be even more generous – the “Bank of Nan and Grandad”.

More than one in three (35 per cent) grandparents have helped their grandchildren pay for university costs or plan to do so in future, according to a poll. This is the equivalent of around 4.9 million people.

Around 15 per cent of grandparents say they have already helped to fund their younger relatives’ studies and another 20 per cent report they intend to help out over the next ten years, found the survey, which was commissioned by Key, 
an equity release advice ­company.

A total of 412,490 UK students have accepted places at universities across the country this year.

The figures were released as a separate survey revealed the majority of Scots parents believe apprenticeships are more valuable for career prospects than a university education. The Bank of Scotland research, conducted in partnership with YouGov, found 36 per cent favour on-the-job training and 33 per cent think higher education is a good idea. However, respondents aged between 18 and 24 were more optimistic about university, with 47 per cent saying they believe it is a good option despite the costs.

Only 19 per cent believe on-the-job training would provide better career prospects.

Ricky Diggins, director at Bank of Scotland, said: “While a university education has traditionally been seen as a gateway into the world of work and remains popular, alternative career paths such as apprenticeships and training can be as effective and are growing fast – and don’t come with the hefty price tag.

“For those about to embark on further studies, it’s important to be open with family about money, as having trusted support and guidance really helps, particularly when it comes to managing tight student budgets.”

The study found 38 per cent of those going to university will rely on a student loan, just under a third expect to use savings and only 7 per cent will use a bank loan or overdraft.

More than a third of students (38 per cent) plan to work part time while studying to help meet their educational costs.

The “How Scotland Lives” research found many students would not be using their parents to help fund their university degrees. This was despite many parents (29 per cent) being happy to support their children in aspirational decisions – a marked rise on the 22 per cent recorded in 2017.

Views about further education differ across the generations, with just 6 per cent of over-55s thinking university is a financially viable option.