By Clare Elsby
Elsby & Co
FOR those of you with cost centres (children) recovering from freshers’ week at respective colleges and universities, the financial impact of their leaving home is arguably longer lasting than their physical absence.
To quote some statistics:
* The Bank of Mum & Dad is expected to fund £2.3 billion of rental payments in 2017;
* 26 per cent of all UK property transactions are funded by parents;
* Bank of Mum & Dad is the ninth largest mortgage lender in the UK;
* 10 per cent of renters have had help with their security deposit.
This, combined with the rise in student debt (recent polls suggest students leaving university with an average loan of £57,000), has resulted in mounting scrutiny in recent months. Tuition fees became a major election battleground following Jeremy Corbyn’s promise to scrap the policy which saw young voters flock to Labour.
Indeed, in October Theresa May announced plans to freeze tuition fees at £9,250 per year while the income threshold at which graduates will be expected to start paying back their loans was raised from £21,000 to £25,000. The Institute of Fiscal Studies has recently published research to say that the PM’s plan to raise the repayment threshold would cost the tax payer £2.3 billion a year and lead to 83 per cent of graduates never paying off the full amount of their loan.
For many, being able to offer facilities from the Bank of Mum & Dad is not an option. But if you are in the ‘lucky’ position where you have funds, perhaps tied up in a family business, then do talk to us. We will be running a series of seminars on Servicing the Bank of Mum & Da, so do contact me if you would like to attend.
To find out more, contact Elsby & Co on 01604 678470, email or visit www.elsbyandco.co.uk