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More and more parents are using their retirement savings to help their children onto the housing ladder so they need to ensure its return. More and more children are turning to their parents to help them secure the necessary deposit to get on the housing ladder. In September 2007 the deposit required was in the region of £13,194 but this has now almost doubled to £32,000 putting it out of the reach of many desperate to get onto the first rung. Records show that a total of £116bn has already been loaned by parents to their offspring. Many parents are nearing retirement age and therefore the money they are giving is paramount to those retirement plans and the assumption is that the retirement will be supplemented by the loan being repaid in monthly instalments. However the fall in property prices and the continuing uncertainty in the workplace does not make those repayments certain and, in some instances, could cause the total loss of the whole loan. Parents are therefore now actively encouraging their children to take out protection for these loans either by way of Life, Mortgage or Critical Illness cover. For those parents who do not have excess retirement funding in place, lending the initial deposit to your children can be a very high risk move so it is wise to ensure that loan is covered in the event of a worst case scenario.

The loss of your job means the loss of your income.  If you lose your income, without savings, the first casualty will be your mortgage… The daily headlines confirm how difficult things are, unprecedented job losses, small business closing daily, whole industries struggling and there seems to be no suggestion this situation will end anytime soon… For [...]