A study from Scottish Widows’ independent think tank, The Centre for the Modern Family, reveals four in ten (43%) grandparents help their families to fund the festive season, spending a collective £932 million. More than a third (36%) of them make sacrifices to compensate for the extra expenditure at Christmas.
The Silver Supporters report, the second chapter of this year’s series looking at later life finances, reveals that grandparents contribute on average almost £140 towards decorations, festive food and gifts to ease the burden on their relatives. This is in addition to spending more than £400 on gifts of their own for children and grandchildren, bringing total expenditure to almost £550 – equivalent to the average December State Pension payment.
However, one quarter (24%) of grandparents admit they feel more financial strain every year and did not expect to support their family as much as they do. As a result, grandparents have been forced to reprioritise what they’re spending their money on to compensate for extra outgoings at Christmas. Of those who have made sacrifices (36%), action ranges from not treating themselves (90%) to more severe action such as turning the heating off or down (64%) and selling possessions (32%). All too aware of the financial pressures facing younger generations, two fifths (41%) of grandparents admit they feel compelled to contribute because their family could not afford Christmas otherwise. Almost three in ten (29%) also believe that without help, their family would not be able to get together at all.
Additional research found that providing financial support at Christmas is symptomatic of a bigger financial burden. Older generations contribute almost £35bn throughout the year to keep their families afloat; 15% make regular payments to their children to help cover the cost of rent, mortgages and household bills. Individual grandparents say they fork out financial help to the tune of over £2,200 a year, although the vast majority (85%) did not make provision for these outgoings. More than half (53%) feel under financial stress – 14% say this is a direct result of giving financial support to children and grandchildren.