There are many reasons why your children could benefit from you saving for their future. It is something that could greatly benefit them if you start to think about it now. There are so many potential expenses for young people these days, something that is only likely to increase over the next twenty years.

Young adults aged between 16 and 24 can have many expenses, often with no income to provide the necessary funds. If someone decides to go into higher education they are unlikely to be in full-time work until at least the age of 21.

One of the major expenses is higher education itself. University tuition is currently around £3,200 a year, so for a three year course that is nearing £10,000. On top of this a student will have to pay living costs such as rent, food and bills, something they may not have been used to paying while living at home prior to this. If paying £200 a month in rent (and it could be much higher) it totals £2,400 a year and over £7,000 over three years, and then there are bills on top of this. Food could be £800 and year (£2,400 in total). Just the expenses mentioned above would total around £19,000 in total.

Learning to drive is something many young people want to do as soon as possible. There was a time when almost everyone turning seventeen years old would learn to drive immediately, but this can be a very expensive business these days. On average a one-hour driving lesson in the UK costs £22 and with the average person requiring 40 lessons that would total £880 just for lessons. Of course this can be much higher or lower depending on the driver. There is then the added cost of both a theory and practical test and more lessons and tests if they fail. After passing a driving test, someone may want to buy a car. They won’t only need to buy the car; they will also need to fork out for road tax, insurance, petrol and an MOT, as well as other running costs such as possible repairs.

Another area that is becoming increasingly difficult is getting on the housing ladder. This is a cost that is continually rising. The average price of a house in the UK is now £224,000.

Saving for children over a long period, for example eighteen years, could greatly benefit them. Of course, not everyone can afford to, but for those who can it can help to make their children’s lives much easier once they reach adulthood. Many choose to put child benefit towards saving for their children. For the first child this currently stands at £20.30 a week, which would be just over £19,000 over eighteen years, plus the interest earned. This could be enough to pay for most of university, or pay for learning to drive plus a car, and still have plenty left over. Alternatively it could go towards a deposit on a house. However they spend it, this amount of money would make a big difference to them. Some would not be able to put this much aside, while others may be able to afford more, but if possible all parents should think about saving for their children.

Andrew Marshall (c)