Advisers play a vital role in helping clients plan for any stage of life, but particularly when it comes to making sure they have enough money set aside to give their children the best start in life.
For some, that might mean being able to afford to put their offspring through private education, while other clients may just want to be able to give their children a pot of money to help them buy a home or establish a career when they reach 18.
Some financial advisers may have far older clients with grandchildren who also want to understand what monetary help they can offer them.
Henrietta Grimston, relationship manager at Seven Investment Management, suggests saving for children is “a very personal thing”.
“Some wealthy clients may choose not to send their children to private school, but might instead embrace an ‘education budget’,” she says.
“In other words, if the child wants to have a maths or science tutor to plug some learning gaps, or learn a language not taught by the school, or go on an expensive art course, they can.”
She acknowledges not all clients will want to educate their children privately or even pay for any type of education. In which case, there are plenty of other reasons to put money aside for their children.
“If parents don’t want to pay for private school or university fees, then help towards a first property might become a more realistic option.
“Some might consider this a more effective use of resources than saving towards university tuition fees,” Ms Grimston adds.
Lisa Lloyd, wealth planner at Sanlam UK, observes: “A financial planner can help you achieve your longer-term savings goals, and we’re finding that funding school fees for children and grandchildren is a key priority for many of our clients.
“The sooner you start putting plans in place to fund such expenses, the better, as these costs could escalate further over the next few years.”
This means the adviser needs to start having the conversation with clients who are prospective parents or grandparents as soon as possible.
“Advisers should be fact-finding their clients to ascertain their total incomings and outgoings, especially when a child is born,” explains Rachel Springall, finance expert at Moneyfacts.co.uk.
“It is at this stage where the parents should be guided through their options – such as saving for the future, any insurance plans or tax credits and any inheritance tax planning.”
Adrian Lowcock, head of personal investing at Willis Owen, points out that providing for their children is often one of the key objectives of clients with families, and so it will impact on a couple’s appetite for risk.
“The first priority for an adviser is determining what the client wants to do for their children and how much money they want to leave or give them in an estate.
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