- Helping with short-term costs can free your child or grandchild to contribute to a pension
- Paying into a Lisa could be better than a pension
- Don't give away what you can't afford
If you’re an active investor, it’s likely that you are set up well for retirement. However, your children or grandchildren may not be prioritising retirement savings due to financial commitments such as debts or expensive mortgages, a young family or saving up to buy a home.
If this is the case with younger generations of your family and you want to help them, your initial inclination might be to pay into a pension for them. However, it might be better to help meet shorter-term financial pressures first, which might also free up capital, enabling your child or grandchild to make pension contributions themselves. “I always suggest paying debt off first, building up a cash reserve for emergencies and then thinking about long-term savings,” says Ian Cook, financial planner at Quilter.