UK Markets closed

Some parents and grandparents ‘expect to cut back on cash gifts this Christmas’

More than a fifth (22%) of parents giving money for Christmas say the amounts will be less this year due to the high costs of everyday bills, a survey has found.

Around one in six (16%) grandparents sending cash are also planning to give less money this Christmas due to the cost-of-living crisis, according to the research from  investment scheme F&C Investment Trust and its manager, asset management group Columbia Threadneedle Investments.

Despite tough economic times, three in five (61%) parents and more than one in two (57%) grandparents still plan to give money to children during the festive period.

Almost half of people (46%) with children or grandchildren said they will give money as well as a small present this year.

Some will give the money as physical cash while others will deposit it straight into children’s bank accounts.

Christmas presents
Some 37% of parents and 36% of grandparents plan to give physical cash this Christmas (Lewis Stickley/PA)

More than a third (37%) of parents said they will give the money in banknotes and coins, while a further 24% will put it into children’s accounts.

Among grandparents, 36% said they will give physical cash and a further 17% will transfer money into their grandchildren’s accounts. A further 3% of grandparents expect to write a cheque and 3% will upload money onto a pre-paid card.

Some people surveyed will give cash in more than one of these ways.

The majority of parents (58%) and grandparents (63%) want children or grandchildren to spend Christmas money on something they would like, while one in three (31%) parents and one in four (27%) grandparents hope that they put the money towards a bigger purchase or save the money for their future.

Ross Duncton, from Columbia Threadneedle Investments, said: “Our research shows that while parents and grandparents want their young loved ones to enjoy the festive period and the gifts it brings, they also want their children and grandchildren to think about how they spend the money given to them.”

Some 2,000 people were surveyed across the UK.