Should you worry about how your teenage grandchild manages their money?

Should you worry about how your teenage grandchild manages their money?

The arrival of a new baby in the family is often the trigger for parents and grandparents to think about the little one’s financial future and how they can assist them through the landmarks of their life.

Most babies born on 2 May 2015 may not have the same financial benefits afforded to the recently born Princess Charlotte, so many families start saving as soon as possible.

But, what about when your grandchild turns 18 and receives a cash sum of your hard earned savings. Should you worry about what they’ll do with their money?

At the end of 2014, Foresters Friendly Society, a mutual financial services provider, carried out a survey into how adults save for children, how the teenagers who may benefit from these savings plan to use that money and what basic money management skills the teens have learnt along the way.  Some interesting results were revealed ….

Starting early and planning for the longer term are at the forefront of adult savers’ minds

With the deposit on a first home currently standing at over £29,000 and the cost of university education predicted to be more than £50,000 in 15 years time1, being able to help the next generation get a head start in life is often at the forefront of many grandparents minds, as the Foresters survey showed, with a significant majority of parents and grandparents already saving, or planning to save, for their children or grandchildren.

If you are already saving for your grandchildren, or maybe just thinking about doing so, deciding to go ahead can often be the easy part.  After the decision is made, it’s then that you need to think about where you save, how long for and how much you can afford to put aside.

The Foresters survey found that the most popular time to start saving is before the child’s first birthday, £10, £20 and £50 are the top three amounts that are put aside each month, and the majority choose to save until the child is 18 years old.

Teenagers are a lot more responsible than we think when it comes to money

It can be easy to assume that teenagers have a bad attitude to money, and a third of adults surveyed said that they were concerned about how the money they have saved will be spent in the future. However, teenagers demonstrate a more responsible attitude to money with 87% regularly or occasionally putting savings aside, and more than half planning ahead and saving up for specific items.

In fact, it’s interesting that when asked how they would use a sudden windfall of up to £20,000, using the money for university or other education costs factored highly, and putting it towards the deposit on a house became significantly more popular the closer the amount was to £20,000.

Financial education is passed down the generations

Introducing children to basic money management skills is the main aim for many families, you may have passed on some money related tips yourself – and it appears to be proving successful as nearly 80% of teens said they had learnt the most about money from their parents, with the next highest source quoted (13%) being their own research via financial websites and books as many feel there is not enough financial education taught in schools.

Perhaps unsurprisingly, most tips that parents/grandparents wanted to pass on centred around saving money – the most common tip was to save a little bit every time you’re paid, other tips included avoiding debt, saving up for things before you buy them, not buying something if you can’t afford it, and to start saving for retirement as soon as possible.

These messages certainly seem to have been taken on board by the 16 – 18 year old respondents, who agreed that the majority of the sentiments outlined by their parents and grandparents above were applicable to their outlook on their finances.  However, no teens mentioned saving for retirement.

The value of family support

It’s easy to see how a healthy, responsible attitude to savings can be passed down through the generations to help ensure that your grandchildren have a good head start in life and a positive attitude to savings to pass on to their own children.

Forresters LogoForesters Friendly Society is a mutual, financial services provider that offers a range of longer-term savings plans and resources to help you plan and save for your grandchild’s future.

You can find out more about saving for your grandchildren with Foresters Friendly Society on their website


The Foresters Friendly Society Saving for Children Survey was carried out in November 2014 among 310 parents and grandparents, and 427 16 – 18 year olds.  For full results, please contact Foresters Friendly Society via


1 The amount of university education was worked out using the NUT estimate of the average student outside London paying £10,133 in 2012/13, multiplied by three years and assuming a low rate of inflation (3.37%) over 15 years. The amount of deposit on a first time home in 2014 as calculated by Halifax was £29,218.

This article is intended to provide information, not financial advice. Foresters Friendly Society do not offer advice. You should contact a financial adviser if you want financial advice to help you decide which the most suitable option is for you. They may charge you a fee for this advice.

Foresters Friendly Society is the trading name of The Ancient Order of Foresters Friendly Society Limited which is an Incorporated Friendly Society (Registration No. 511F) and is authorised by the Prudential Regulation Authority and regulated by the Financial Conduct Authority and the Prudential Regulation Authority (Registration No. 110029).