Struggling parents are compelled to postpone their retirement due to skyrocketing educational expenses for their university-bound offspring.
In a challenging economic climate, the financial burden of university education is causing concern for many parents and students in the UK.
According to recent data, almost 30% of students find that their maintenance loan does not cover the full costs of living away from home. This leaves them in a precarious position, struggling to meet their basic needs.
The job market for graduates is also becoming increasingly tougher, with a 33% decline in entry-level jobs. This means that many new graduates are finding it difficult to secure employment that can help them repay their student loans and cover their living expenses.
The financial strain of university education is not just affecting students, but also their parents. Government data estimates that the average 2024 graduate leaves university with debts of £53,000, and this financial burden is being shouldered by many parents.
A study shows that over three quarters of parents admit that funding their children's education has negatively impacted their finances. Some parents have had to sell investments, borrow on credit cards, remortgage their homes, or even postpone their retirement to cover the costs.
Roughly a fifth of parents pay all their child's costs, including academic and living expenses, while nearly one in seven parents find themselves forking out a staggering £10,000 to £15,000 annually. Nearly 10% of parents provide more than £15,000 a year to support their children at university.
Faye Church, senior financial planning director at Rathbones, stated that the financial consequences of supporting adult children for longer are significant, both in the immediate and long term. She warns that parents must carefully consider the impact on their own retirement plans and financial stability.
Nearly two-thirds of parents cashed in their savings to cover the costs, while others reduced their pension contributions or extended their careers by up to 10 years to afford the financial burden.
The organization that conducted the study showing that over a third of parents in Great Britain must delay their pension to fund their children's university education costs is not identified in the provided search results.
Despite the financial strain, over half of the parents surveyed expect to continue supporting their children due to a lack of confidence in their children's financial independence after graduation.
The increase in university tuition fees this year to £9,535 from £9,250 has only added to the financial pressure. It remains to be seen how the government will address these concerns and help alleviate the financial burden on parents and students.
