Parents are being urged to start saving for their children from birth, after research found that waiting until primary school age could leave them thousands of pounds worse off. A study of 2,000 mums and dads with children under 18 found that once they begin saving, they put away an average of £63.24 a month for their child's future.
However, parents typically wait until their child is around five years old before setting up a savings account. This delay could mean missing out on around £3,794 that could have been built up from birth, based solely on the money paid in and not accounting for any interest that could have been earned over time.
Delaying savings costs thousands
The figures show that 11% of parents do not get a savings account at all, which could amount to £13,659 at the same contribution rate by the time their child turns 18. The potential value of the savings could be significantly higher when interest is considered.
The research was commissioned by Skipton Building Society to support its initiative encouraging early saving. Eligible parents of children aged three and under can receive £25 when they open a Junior Cash ISA in branch and deposit £50 by 29 December 2026.
Building a savings habit early
The building society partnered with The Mum Club to host a brunch for new mothers, offering expert guidance on the financial milestones their children may face in the future. Skipton is also bringing back the Skipton Castle Money Box for families who open an account, to help inspire saving from a young age.
Alex Sitaras, head of savings at Skipton Building Society, said: "The first year of becoming a parent can feel completely overwhelming. Between adjusting to a new routine, managing household finances and navigating countless new responsibilities, opening a savings account for your child isn't always at the top of the to-do list. That's completely understandable, but our research shows just how much difference getting started early can make."
Parents regret not starting sooner
Of the 66% who did not set up a savings account before their child's first birthday, 26% were too focused on other financial priorities during their baby's first year. Another 26% wanted to wait until their child was older, while 21% intended to open an account but never got around to it.
The survey, conducted by OnePoll, found that 55% of parents wish they had started saving for their child earlier than they did, with 39% now recognising the benefits of getting started early, and 33% worried about the future costs their child will face.
More than half (53%) of parents with children under 18 believe their child will face greater financial challenges than they themselves have experienced. Buying a first home was cited as the biggest challenge they expect their child to face (43%), while 38% are worried about university costs, and 26% are concerned about the cost of learning to drive.
Money preferred over toys
Many parents supplement their regular monthly contributions, with 32% depositing money if gifted by family members and 31% putting money aside on birthdays. In fact, 75% feel adding money paid into savings is a more valuable gift for their child than toys or other presents, with 34% of these saying physical gifts are often quickly forgotten about.
Lauren Webber, co-founder of The Mum Club, said: "Like many parents, I spent so much time thinking about my child's immediate needs that I didn't always stop to think about everything that comes next. The early years go by incredibly quickly, and it's often only when you start talking to other parents that you realise how important those early conversations and plans can be."
