Bank of Mum and Dad increasingly provide offspring with financial help

PARENTS in the UK are gifting or informally lending millions to their adult children.

The Institute for Fiscal Studies (IFS) estimated that this year they would help out with around £17 billion (€19.13) on marriage or buying a house.

Around 30 per cent of young adults in their late 20s and early 30s can expect to receive at least one substantial transfer of £500 (€563) or more over any eight-year period from their parents, the IFS revealed.

“These transfers are very unequally spread,” IFS investigators said, as the children of university-educated, home-owning parents received up to six times more in their 20s and 30s than those who families rented.

White young adults were also three times more likely to receive a substantial gift than Pakistani or Bangladeshi young adults, the IFS said.

The report found children in the highest-income fifth of society received 26 times more than their peers in the lowest fifth during early adulthood.  Help amounted to £6,300 (€7,094) on average for the wealthiest, compared with £240 (€270) for the poorest.

People were more likely to receive a large gift on marrying but were unlikely to receive transfers when facing adverse events like losing their job.

Those in the least-wealthy third also tended to use gifts to purchase a new car, to pay off debts or for educational expenses, the IFS added.

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