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Lloyds TSB reports: How saving on the Christmas budget can make a nest egg as well as eggnog(January 02, 2013)
(PRWEB UK) 2 January 2013
Children have not been shy in making clear their Christmas wishlists this year, with almost three quarters of parents (74 per cent) knowing exactly what their children want as their top present, according to research from Lloyds TSB i.
These children also look set to have their Christmas wishes answered, with four in five parents who know what their child wants (80%) saying they will buy their child their top present. Just under one in 10 (9%) have said they wouldnt, with a further five percent saying they will look to buy a cheaper alternative.
The research also found that parents will spend an average of £180.38 on each of their children at Christmas this year, with £105.29 spent on their main present, and an average of £75.09 on additional presents. One fifth of parents (20%) will spend on average £25-£49.99 on their childs main Christmas present. Top treats this year include iPads and tablets (10%), games console games (10%), and games consoles (8%).
Children in Scotland look set to be the biggest benefactors, with parents in the region splashing out an average of £124.49 on their youngsters main Christmas present. This is considerably more than the £78.44 that London-based parents are willing to pay out.
However, parents could save up to £3,600 (£3,628) over 16 years if they invested the money spent on presents in savings accounts instead. Indeed Lloyds TSB research shows 80 per cent of parents with children aged 16 and under already have a savings account in place for their child which would make this an easy Christmas gift.
If this money were to be placed in the
Lloyds TSB Young Saver account
for each year over a 16 year period, parents could see this nest egg for their child grow to £3,628, having earned over £748 in interest aloneii.
Saving on the household Christmas budget also adds up
Although not all family spending over Christmas will be on the childrens presents, households looking to save rather than spend over Christmas could also see considerable returns. Lloyds TSB estimates that the average household spend on Christmas is almost £550 (£544).
Investing this money in the same Lloyds TSB savings account annually over 16 years, would achieve a savings pot of almost £11,000 (£10,965), of which over
£2,200 (£2,261) would be interest earned. Similarly, saving just a third of this total each year over 16 years adds up to over £3,000 (£3,648) and more than £750 (£752) in interest.
Greg Coughlan, Head of Savings at Lloyds TSB, said:
Whilst we appreciate that most parents would not choose to forgo spending on their childrens Christmas presents, this research demonstrates how setting just some of the Christmas budget aside could add up over the long term. Whatever the spend, Christmas is an expensive time and saving a little and often throughout the year will help to pay off those yuletide bills.
With household budgets stretched as we go into this festive period, it is more
important than ever to ensure that any savings that can be made are put to the best use. Starting a nest egg for your childs future could be one Christmas present they are truly grateful for in the years to come.
Household expenditure on Christmas
Calculated by using ONS data on the average household expenditure on goods that are
typically bought for Christmas and uplifted using retail sales data to reflect the extra
expenditure that takes place in December.
All figures have been expressed in nominal terms.
Lloyds TSB Young Savers account feature:
- Earn a variable rate of 3.00 % AER from £1, and 0.50% AER on any funds over
- A gift of a Stanley money box on account opening (subject to availability).
- Parents maintain full control of the childs account until they turn 16. Before the child's
an Easy Saver with bonus solely in the child's name. If parents would prefer the
money to be paid into a different account either for their child to manage themselves
or for them to manage on their behalf, we'll let them know how to do this.
- Customers must have a Lloyds TSB current account in order to open a Young Saver.
- One Young Saver account per child.
- Register for Save the Change® and watch their savings grow even faster.
- Instant access through a Lloyds TSB branch.
i All figures, unless otherwise stated, are from YouGov Plc. Total sample size was 1009
parents with children aged 16 and under. Fieldwork was undertaken between 20- 23rd November 2012. The survey was carried out online.
ii This figure is gross of tax and calculated at the Lloyds TSB young saver rate of 3.00 % AER
from £1 to £19,999; this is a variable rate and could change in the future.
"This report is prepared from information that we believe is collated with care, however, it is only
intended to highlight issues and it is not intended to be comprehensive. We reserve the right to
vary our methodology and to edit or discontinue/withdraw this, or any other report. Any use of
this report for an individual's own or third party commercial purposes is done entirely at the risk
of the person making such use and solely the responsibility of the person or persons making such reliance. © Lloyds TSB all rights reserved 2011"
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