As a grandparent, how would you feel if you knew your grandchildren were struggling financially? Is it the responsibility of your children – their parents – to help them out, or do you think it’s fine to step in and help? And are you disempowering anyone by getting involved?

We spoke to one of our younger writers, Lauren, who has found herself having to approach her grandparents for help during these difficult times, to see how that decision affected all three generations…

The past few months have undoubtedly been hard for a lot of people. But what happens when the going gets really tough financially, and you need a helping hand to see you through until work picks up?

This is the predicament I found myself in, when Covid-19 reared its ugly head. I’ve been working as a freelancer for a few years now, and often have times where things are a bit slow, that goes without saying.

But that’s nothing compared to what I’ve faced over the past few months. Understandably, budgets have been cut and clients are more wary about hiring. I get it – but unfortunately ‘getting it’ doesn’t pay my bills. I was starting to really worry about what would happen to me.

My first port of call was the Bank of Mum and Dad

I have been financially independent since my late teens, and have never had to rely on my parents for help. But this time I felt like I had little choice but to ask for assistance. Things have been really hard, and work isn’t exactly flooding through the door.

As with all my problems, my parents were my first port of call, so I instantly set up a very professional meeting with them, to discuss my situation and to see if there was a way they could possibly help. I presented a proposal so I could ask for a loan, which I would pay back in instalments.

Mixing money and family is not something anyone does lightly, and it’s never comfortable. I felt I wanted to create a situation that felt professional, so they didn’t feel like I was simply asking for a ‘handout’. 

However, I was in for a shock

I always think of my parents as indestructible, and assume they can fix any situation for me. Not only that, I’ve always assumed that the ‘Bank of Mum and Dad’ would always be there, if I ever needed it.

Unfortunately, my parents were in a similar situation to me. Their own finances have suffered since the pandemic too, so loaning me money was not really an option. This came as a shock, as I’d always assumed things were stable for them financially. But the pandemic has been cruel to many people, my own parents included.

It was a blow to realise they wouldn’t be able to step in, but at the same time I appreciated that they probably felt awful they couldn’t help. They did, however, suggest an alternative…

I looked to my Grandparents for support

Like my parents, my Grandma and Grandpa have always been a reliable support system for my brother and me. I know that I can turn to them for anything, so why didn’t I go to them in the first place?

It mainly came down to pride. I felt ashamed that I had to ask them for money, and the fact I couldn’t ask them in person due to shielding, felt even more disrespectful. I certainly didn’t want to ask for money over the phone. Discussing money with family is difficult at the best of times, but over the phone just felt wrong.

My brother, however, was able to help us all out. He gave our grandparents an intensive training course in video calling, and got them set up. This meant I could see them face to face, which felt much better. I asked them for a loan – that I fully intend to pay back – and they kindly agreed, but said one thing, “We don’t want to see a penny back from you.”

It was an emotional experience. I hadn’t expected a gift – but the relief was enormous. I was incredibly grateful. 

I was worried my parents would feel they’d failed me 

I needn’t have worried. My parents already knew my grandparents were going to do this, which I think is why they sent me in their direction in the first place. They knew they were planning on giving my brother and me an ‘early inheritance’ at some point, so they’d felt it was a good time to discuss it. 

I was really worried about things becoming awkward between my parents and me. I didn’t want them to feel like I was taking advantage of anyone. But, more than anything, they’re just happy my grandparents were able to assist me. That, too, was a relief.

I wondered how my grandparents felt about helping me 

Once I’d got over the embarrassment of the whole situation, I wondered how my grandparents had felt; whether they’d found it excruciating too. 

My Grandpa, Gerald, explained that they’d worked hard in the past, to ensure they had enough tucked away for hard times, or to help family. 

“We’ve always been quite careful with money over the years, to ensure we had a nice amount put away for a rainy day,” he said. “I worked as a taxi driver in London for more years than I can remember, working weekends and evenings, all the while working at Royal Mail in the Accounts department – they give a nice pension. 

“When you asked us for help, we were expecting it. We knew things were difficult. The pandemic meant we had to shield, which in turn meant we were able to save more money.

“We didn’t mind helping at all. We don’t want the money back and there’s no need for anyone to feel awkward about anything. We’ll also give to our other grandchild, to ensure things are fair.” 

Grandma Caroline had much the same approach. “I worked as a hairdresser for many years and have always been a saver,” she said. “We had been discussing ‘early inheritance’ anyway. During these uncertain times it’s hard for everyone, and the way we look at it, all we have will go to our children and grandchildren anyway, so why not speed things up a bit!

“We were happy to do it. We always want to help our family.” 

It made me realise how very different our generations are, when it comes to money. My generation doesn’t always think about saving – but this experience has really raised my awareness of the need to do so. I’d like to think that, years down the line, I could do the same thing for my own grandchildren. 

What happened next? 

My grandparents made it their mission to set things up, and settle an amount on me as soon as possible. It’s been an absolute lifesaver. 

Although they initially wanted the money to be used towards a deposit on a property, they accept that we are experiencing exceptional circumstances, and that I’m going to need some of the money just to live on. They’re hopeful that I will be able to start saving something when things start to pick up again.

So instead of the Bank of Mum and Dad, I went to the Bank of Grandma and Grandpa, and I fully intend to make the best use of the gift I have been given. It’s not often that you receive a gift like this, that gives you not only immediate support, but also an insight into how finances can help generations to follow. So I’ll be making more concrete plans for my finances in future. And I’m going to set up my own savings account, as soon as I’m able to. 

Read more

Family in a lake

How annuities work

Many people are looking for reliable ways of funding their later years. Perhaps you want to make sure the bills are covered for the foreseeable future. Maybe you’d like to fund those trips you’ve always dreamed of taking, or that hobby you’ve always loved so much. Or you might just want to top up your income when you switch to working part time.

Women cooking

Enhanced annuities explained

Later life health problems can make enjoying your well-deserved retirement years harder than it should be. They can hit your finances too, pushing up the cost of day-to-day living and creating new care and support costs.

Couple laughing

Annuity vs drawdown – what's the difference?

Many of us have spent the last few decades planning and carefully saving for the things that are important to us, whether that’s life’s luxuries, our mortgages and bills, or our plans for the future. As we get older we might have different priorities, but our financial planning for retirement should be just as important.