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One in four people over the age of 65 are owed money by their children

According to an article published by the Telegraph, nearly one in four pensioners are owed thousands of pounds by their grown-up children and many still live at home.

A study found that 23% of retirees admit their grown-up children are in debt to them, with the average amount owed around £3,100. The Daily Mail went on to comment that one in ten said the outstanding debt was more than £5,000. And on top of this financial generosity, one in eight parents said they also had adult children or even grandchildren living with them [1].

The survey also showed that the number of parents who made such claims varied from region to region. For example, 36% of respondents living in the North East of England- more than one in three- said that they had relatives who were indebted to them. In Scotland one in five (20%) of retirees are owed money by their children.

According to statistics published by the Telegraph, within England people living in the South West were the least likely to say that their adult children owed them money, with 12% saying they were owed cash.

Vick Shaw from the Daily Telegraph has said:

“The research comes at a time when many older people have been handed new freedoms over how they use their retirement cash. From April, people aged 55 and over with a defined contribution (DC) pension have been given the flexibility to take their pension pot how they wish, subject to tax, rather than being required to by an income with it called an annuity” [2].

Dominic Grinstead, managing director of MetLife UK said:

“Being able to lend adult children money is important to millions of retired people and many can definitely afford to do so and are happy to pay out.

“But the fact that so many are helping out adult children demonstrates that people need flexibility in their finances in order to be able to fund potential financial surprises”.

[1] Louise Eccles, “Quarter of over-65s are still owed money by their grown up children: Hundreds of thousands of pensioners have loaned money to family and not been paid back”, The Daily Mail

[2] Vicky Shaw, “Adult children owe parents an average £3,100”, The Daily Telegraph