Mothers are 79% more likely than fathers to open JISA or ISA for their children, according to new research from Columbia Threadneedle.
It reveals that parents across the UK are keen to secure their children’s financial futures, but with it comes the feeling of pressure to make the right investment decisions.
This research was conducted by Opinium 11-21 October, 2024, polling 2000 UK investors aged 18 and above.
Nearly half (44%) of parent’s report experiencing stress about making the right investment decisions for their children, with many expressing doubts about whether they’re doing enough to protect their children’s long-term wealth.
The research highlights a growing sense of anxiety among parents when it comes to securing their children’s financial future. A third (35%) of parents worry they haven’t saved enough for their children’s future, and 31% are unsure whether they’ve made the right investment decisions. These concerns are compounded by the complexities of investing, with 30% of parents feeling confused by the investment market and a lack of clear guidance.
Mothers are bearing the brunt of the pressure to secure their children’s financial futures, being 79% more likely to open a Junior Individual Savings Account (JISA) for their children than fathers.
However, this responsibility often comes with heightened anxiety. Around 50% of mothers report feeling stressed about getting their children’s investments right, compared to just 38% of fathers. The pressure on mothers to make sound financial decisions for their children appears to be significantly greater.
As they struggle to make informed investment decisions, many parents are seeking support from friends and family to build their confidence. Nearly a third (28%) of parents turn to their social circle for advice, with 45% spending more time researching different investment options. However, 11% of parents have not taken any steps to improve their knowledge or seek help, pointing to a gap in support and understanding.
Among younger investors who aren’t proactive with their investments, the uncertainty is even more pronounced. 43% of investors aged 18-34 report feeling unsure about their investment knowledge and choices, indicating that younger generations may face greater challenges when it comes to navigating the investment landscape.
Beyond the concerns about making the right decisions, many parents also feel pressure to invest more in their children’s financial futures, even when it places a strain on their own finances. Nearly half (45%) of parent’s report feeling pressured to contribute more to their children’s savings, even when it’s financially difficult. The emotional toll of this pressure is significant, with 30% of parents admitting they feel guilty for prioritizing their own financial needs over their children’s future.
The need to get it right is also a driving force for many. Almost two thirds (60%) of parents wish they had started investing earlier for their children, highlighting a common regret among those who are now focused on catching up.
One positive finding is that many parents are taking steps to involve their children in discussions about money. Nearly two-thirds (65%) of parents regularly talk to their children about money in general, and 55% engage in conversations about investing. Parents are increasingly recognising the importance of financial literacy and are taking steps to instil this knowledge in their children early on.
Marrack Tonkin, head of investment trusts at Columbia Threadneedle, said: “With rising costs of education and living, it’s not surprising that many parents feel worried when it comes to investing for their children. It can feel like a big decision, especially if parents don’t feel confident about investing to start with.
“One of the easiest steps to take, is to open an ISA or JISA for a child and invest small regular amounts as early as possible. Even small amounts can grow substantially over time due to compound growth and investing a little and often can make it easier to manage within a budget.
“Adopting a habit of saving and investing can play an important role in helping children develop a better understanding about money and it’s encouraging to see in our research, the high proportion of parents who find ways talk to their children about investing.”
“However, while every parent wants to help give their child the best start in life – including helping them financially – it shouldn’t be at the expense of their own finances. If this happens there is always the option to adjust the amount you save, rather than feel overwhelmed or financially stretched.”
