{"id":6105379,"date":"2025-05-23T15:16:19","date_gmt":"2025-05-23T14:16:19","guid":{"rendered":"https:\/\/www.buyassociationgroup.com\/en-gb\/?p=6105379"},"modified":"2025-05-31T10:44:10","modified_gmt":"2025-05-31T09:44:10","slug":"wealth-bank-of-mum-and-dad","status":"publish","type":"post","link":"https:\/\/www.buyassociationgroup.com\/en-gb\/news\/wealth-bank-of-mum-and-dad\/","title":{"rendered":"Why being the ‘Bank of Mum and Dad’ is a smart move for wealth planning"},"content":{"rendered":"

In the UK, the ‘Bank of Mum and Dad’ is often a crucial part of the journey for first-time buyers, but knowing where to begin to help your children can be a minefield. Sam Hadfield, managing director at BuyAssociation<\/a>, explores how the ‘Bank of Mum and Dad’ can be maximised to benefit all involved.<\/h2>\n

Let\u2019s be honest, the \u201cBank of Mum and Dad\u201d used to be something you\u2019d mutter when a friend sheepishly admitted that their house deposit had parental origins. However, it is an important source of income. In fact, it\u2019s practically a financial institution – one in which meetings take place over Sunday\u2019s dinner table, background checks border on invasive, and they rarely charge interest.\u00a0<\/span><\/p>\n

In 2023 alone, parents in the UK contributed \u00a39.4 billion<\/a> to help their children buy homes. That\u2019s around 164,000 first-time buyers – a full 57% of the mortgaged first-time buyer market. To put that into perspective, the Bank of Mum and Dad, or BoMaD (yes, it even has an acronym), lent more money that year than TSB or Virgin Money in property loans or mortgages. <\/span><\/p>\n

This unofficial \u201cbank\u201d now sits comfortably in the UK\u2019s top 10 mortgage lenders – except with far lower interest rates<\/a>, far looser terms, and considerably more emotion involved.<\/span><\/p>\n

Choosing a strong strategy<\/h3>\n

It doesn\u2019t stop at bricks and mortar. Parents are also covering school fees, university costs, household bills, start-up investments, and even holidays. The wider BoMaD economy is estimated at \u00a317 billion annually (depending on which figures you trust) and that makes it a powerful player across several sectors; not just property<\/a>.<\/span><\/p>\n

But there\u2019s a catch: being in a position to help your kids financially is a privilege. It is generous. It is meaningful. But it is not compulsory. There is no set of rules on \u2018how to\u2019, and not all \u2018banks\u2019 operate in the same way. This \u2018how to\u2019, the strategy and the execution, is what determines success for both the parent and child.\u00a0<\/span><\/p>\n

My position as managing director at one of the UK\u2019s leading property investment companies means I come across families every day who are navigating the landscape of the Bank of Mum and Dad – eager to help, generous to a fault, and naive on how best to support their child.\u00a0<\/span><\/p>\n

Although gifting is noble, sometimes the greatest gift isn\u2019t the deposit, the loan or the house. Think smart, think strategically, think sustainable.<\/span><\/p>\n

Ask yourself some questions:<\/span><\/p>\n