Parents could be leaving almost £3,800 on the table by waiting until their child is five before opening a savings account, new research suggests.
A study of 2,000 mums and dads with children under 18 found parents who save for their children put away an average of £63.24 a month.
But parents typically wait until their child is around five before opening a savings account – potentially missing out on £3,794 that could have been saved between birth and their fifth birthday.
The figures are based on the money paid into an account and do not include any interest or investment growth, meaning the potential difference could be higher depending on the account used.
The research was commissioned by Skipton Building Society. Skipton is encouraging eligible parents of children aged three and under to open a Junior Cash ISA in branch and deposit £50 by December 29, 2026 to receive £25 as part of its initiative.
One in 10 children don't have a savings account
The study also found that 11 per cent of parents do not open a savings account for their child at all.
At the average monthly saving rate of £63.24, that could mean missing out on £13,659 by the time a child reaches 18, before any interest is taken into account.
Among parents who did not open an account before their child's first birthday, 66 per cent said they had delayed starting.
The most common reason, given by 26 per cent, was that they were focused on other financial priorities during their baby's first year.
Another 26 per cent wanted to wait until their child was older, while 21 per cent intended to open an account but never got around to it.
More than half – 55 per cent – said they wished they had started saving earlier.
Parents worry about the cost of their children's future
The research found 53 per cent of parents believe their children will face greater financial challenges than they have experienced themselves.
Buying a first home was the biggest future financial concern, cited by 43 per cent of parents.
University costs were a concern for 38 per cent, while 26 per cent were worried about the cost of learning to drive and getting on the road.
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.
“Many parents are surprised by the impact those first few years can have. Starting from birth rather than waiting until age five could mean thousands of pounds more in savings by the time a child reaches adulthood.
“Starting to save early can make a real difference over time, which is why we're encouraging parents and grandparents to take that first step towards building a savings habit for their child.”
He added: “The good news is that building a savings pot doesn't require huge amounts. Even small, regular contributions can add up over time and create meaningful opportunities later in life.
“Whether it's helping with the cost of education, supporting a first car purchase or contributing towards a future home deposit, starting early can help give children a stronger financial foundation for the years ahead.”
Parents are choosing cash over toys
The research found that parents often add extra money to their children's savings alongside regular monthly contributions.
Some 32 per cent put money into the account when family members give their child cash, while 31 per cent use birthdays as an opportunity to save.
Overall, 75 per cent of parents said putting money into savings is a more valuable gift for their child than toys or other presents.
Of those parents, 34 per cent said physical gifts are often quickly forgotten, while 48 per cent believe money would help their child more in the future.
A further 40 per cent said saving could help teach their child the value of money, while 31 per cent would rather money went towards future ambitions such as learning to drive, university or buying a home.
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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.
“Connecting with other parents can be a great way to share experiences, build confidence and start thinking about the future.
“That's why we're delighted to be working with Skipton Building Society to bring families together and help them feel more prepared for the years ahead.”
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