Collaborative Post | The recent Census data in the UK was revealing in more ways than one, particularly in terms of the median age across England and Wales.
This increased from 39 years in 2011 to 40 years in 2021, as the structure of the UK population continues to change and the life expectancy of individuals rises incrementally across most demographics.
The good news is that this enables older citizens to enjoy their grandchildren for longer, while affording them more time to help provide for their futures. Here are some actionable ways in which to help your children.
1. Provide guidance and support
Children and adolescents go through a number of milestones and rites of passage as they approach adulthood, and these can be incredibly challenging from an emotional perspective.
Teenagers in particular also go through incredible physical and mental changes, which grandparents and adults can relate to having experienced similar challenges and difficulties during their lifetime.
In this respect, grandparents can help to guide children by sharing their wisdom, aiding their mental health while making the transition into adulthood much smoother.
Children may also prefer to discuss certain issues and problems with their grandparents (as opposed to their parents), and providing this type of support may help kids to avoid difficult situations.
2. Consider opening a bonds account
Financial support is also key in the current economic climate, especially when you consider the prohibitive price of housing (despite the recent dip in the market) and wider cost-of-living.
There are various ways in which you can achieve this objective, but we’d definitely recommend opening a bonds account for your grandchildren. A savings bond is a type of fixed-form investment, which unlike flexible access or standard savings, lock your capital away for an agreed amount of time.
So, you could open a savings bond that will appreciate incrementally as your grandchildren grow, with longer-term bonds typically boasting higher rates of return.
Through this type of savings vehicle, your grandchildren can accumulate wealth consistently and access a potentially lucrative sum at the time of maturity
3. Gift some of your inheritance
While you can make your grandchild a key beneficiary of your will, this may prevent your grandchildren from receiving financial support when they need it the most.
If you also own an estate that’s worth in excess of £325,000, this will also be subject to inheritance tax (IHT), which carries a levy of 40% and impacts directly on the amount of money your grandchildren receive.
However, you can circumnavigate these challenges in part through the processing of gifting, which enables you to give away up to £3,000 a year without this being added to the cumulative value of your estate for IHT purposes.
As a grandparent, you can also give a wedding gift of up to £2,500, while there are provisions that enable you to gift larger cash sums to beneficiaries at least seven years before you pass.
Disclaimer: this is a collaborative post
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