Need to plan at to give at least £100k per child to set them up in early adulthood

[TulipLavender]

I have very young DCs and I'm currently nowhere near a high income but I've been thinking a lot about future financial planning.

What the impact of AI, unknown or insecure job market for younger generations, cost of living etc., I feel like I should prioritise saving to help provide some support for each of my DCs to help pay for uni costs and then support with later house deposit. I'm also expecting that they may need to live at home long into their 20s.

So I'm thinking i need to plan to be able to have £100k available for each child. Even this seems like it may not stratch the surface with unknown future uni costs and house prices but it will be a struggle to achieve this savings goal.

What are your thoughts around future financial planning for yoru children, do you have a target amount in mind? Would you prioritise this over paying a lot for things like holidays now?

YABU - its too much to give and need to reprioritise enjoying life more now

YANBU - with such unknown futures for our children, they will need at least this to ensure they have a safety net and support with getting on their feet

I think trying to achieve a set sum (particularly a very high one) is just going to set you up to be stressed if you don't achieve it, or potentially miss opportunities for development and fun if you focus too much on a specific amount - e.g. if we don't go on holiday that's an extra £500 I can save for them, I'll say no to piano lessons and save the money instead, etc.

Not saying it's not good to save at all, but I think that saving for your own retirement as you've said is the best plan and then if you're comfortable can help them as and when they might need it. They might win the lottery or get very well paying careers and might not want your money. Or you could save thousands for uni and then they decide they don't want to go, or get a full scholarship or something.

Similarly if you have a health scare or develop additional needs or whatever when you're older, I'm sure they'd probably prefer you to use money yourself to pay for private treatment or get your house fitted appropriately, than lose their mother early but be a few grand better off.

as a pp said, inflation will affect any savings. best to pay off your own mortgage etc first.

Sorry - quoted the wrong post there. Meant to quote the one saying ‘it’s not even a house deposit’

Haha just the other day we had the poster who thinks a salary of 50k is just a hobby job 🤣

Bonkers. Unachievable for most parents. Kids have to learn to stand on their own feet..

Agreed, it could buy a whole house where I live!
Very strange when people reference one of the most expensive cities in the world when deciding if they can afford a house.

Don't listen to these people.

It's extremely difficult for young people coming out of uni to find a job, let alone fund a house. I would save as much as I can for them, either ina JISA or your own ISA and I would hand over the money when they are in their mid 20s. It will give their lives an incredible boost. They won't have to deal with peeing away their money renting. It will be a boon for them. Ignore the advice which says your job ends when they go of to uni as that's an out dated view.

Even £50k would be enough to get them started - that's a 10% deposit in their first home.

God this post reeks of privilege doesnt it.

Given you can buy a flat in London for figures around 150k upwards depending on where you are, its a huge amount. Even if you bought a house for 400k, which are available, its still a huge amount of deposit. If you bought a house for a million its 10% deposit, on what planet is it not going to go very far

And guess what, there are locations outside of London, where people do actually live!! Yes they actually live in a house, use local shops, have a job, their kids to go school. All outside of London wouldnt you know!!

There are places in the country where you could get a 4 bed house for about 250k

Our house is a 3 bed semi, 80 miles out of London on the south coast, worth about 300k or so. Huge deposit for this house.

If you don’t have a high income I’d focus on building your own wealth, then downsizing at some point in their adulthood and freeing up the money you think each will need. This can be your own mortgage or a S&S ISA depending on how much money we are talking about.

Having their own savings / investments at this age is really more about tax efficiency, but this is only really relevant if you are maxing out your ISA allowances etc each year IMO.

Yes, we are saving as much as possible to get them a property. The earlier you buy the better imho, a lot of people get trapped because they are early thirties before they buy a first property, then struggle to upgrade because maternity leaves/part time work, family expenses and childcare costs limit their ability to borrow more/overpay to take the next step.

Yes the teens will effectively get all our money before we die - that’s the plan

but we are not going to worry about them to this extent
they are fairly smart, polite, resilient, kind lovely young men (or growing into) - let’s see where they head to first without losing our minds with worry

(AI isn’t going to take over the world it’s just not that good)

I’m saving in an ISA for DD (£100 per month) and have done since she was a toddler so there should be a chunk there for house deposit. Her dad also saves separately. I’ve also been saving the maximum into a LISA since I was early 30’s (£5k per year in total) so hoping there’s about 100k tax free there. By the time I can release that (age 60), DD will be 32 by then and will hopefully have bought a house so not sure how helpful that will be.

Mine had about half this (grandparent inheritance passed on directly to dcs). At least 50% was 'wasted' and the youngest blew the lot. They were over 18 and it was out of our control.
So be careful.
(I am saving up for them again now, but it won't be anything like the same amount. I am keeping quiet about it though.)

100% this. Having been at uni with many people who had had everything handed to them, I can tell you that they struggled hugely, both at uni and in the job market and the workplace.

better to invest your time and resources into them developing into resourceful, robust independent adults than entitled brats that expect handouts?

Why have you set such low expectations for your kids? Young people are adaptable and have found their way through every big change that their (our) parents fretted about. You've diagnosed them with failure to launch before they've even reached 18.

I don't actually know anyone who got on the housing ladder without some form of help, but I am a Londoner.

Good point. Perhaps it's because getting them to leave me alone for 2 minutes so i can go to the loo in peace at the moment feels unattainable. 😂

I don’t think £100k is going to go very far. It’s not even a house deposit in London

Of course it is, obviously you don't know London very well!

You need to plan your own life and your retirement, if there is anything left then you can give to them. It's not mandatory to leave an inheritance, maybe focus more on helping them become able to support themselves, esp since 100k doesn't go far now, it certainly won't go far in 20 years. Jobs won't just disappear with AI, people will have to learn to evolve to work with it, many of us already do.

What big change have previous young people gone through that is similar to housing being completely unaffordable; offshoring and automation of entry level jobs; and a demographic timebomb?

What about your life? You need to live and enjoy your money (within reason).

I don't understand parents (mainly women) who put their own life completely on hold for their kids. You are giving up your one life for a future you can't control. Be sensible, but live now while you can

AI will eradicate many jobs. AI is just in its infancy, and there are improvements every few months.

I agree. Not since WW2 I guess.

It's a small deposit for a shitty flat in a shitty part of london. I do know london. The avg house price in a good part of london is 700k. How does 100k make a deposit on that? Only if you have an income of 150k.