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Supporting children and grandchildren is something that some families may consider as part of their longer-term financial planning, particularly when thinking about how they might help with significant life events.

As young people strive for independence, the rising cost of homes and the large deposits required could make grandparents saving for their grandchildren more important than ever.

In this article we explore the options grandparents may have when it comes to saving for grandchildren, gift giving, paying for regular expenses like tuition, and utilising the wealth tied up in their homes through equity release.

Later, we will explain that you can get expert advice on using your property wealth through Royal London Equity Release Advisers, the provider of the Telegraph MediaGroup Equity Release Service.

Four reasons to gift money to grandchildren

1. Put down a house deposit

In January 2026, the Land Registry House Price Index shows the average price of a home in the UK was £268,421. At this level, a 10% deposit would be around £26,842, a significant sum.

With wider cost-of-living pressures and maintaining a good quality of life, saving for this deposit could take several years. With a well-timed gift, grandparents could help their grandchildren with a step up onto the property ladder.

2. Fund further education

Tuition fees are a hot topic right now with discussion around things like interest rates. Some grandparents might choose to help with tuition fees, or support with the overall living costs of moving away for university.

Helping out grandchildren could mean more time spent studying and less time worrying about financial matters.

3. Help pay for a life event

Grandparents could choose to help out with the significant life events, like a wedding. With a cash gift, your grandchildren could pay for their perfect venue, ensure the whole family can gather, or even go on their dream honeymoon.

By supporting with the costs of a wedding, they can focus on the joy of planning their special day and worry less about the price involved.

4. Contribute to their retirement plans

According to the Pensions UK Retirement Living Standards, developed by Pensions UK in partnership with Loughborough University, a couple would need around £43,900 a year to achieve a moderate standard of living in retirement. State pension income alone may not be sufficient to meet this level, meaning additional private pension income or savings are often an important consideration.

It could be an option to support your grandchildren with a boost to their pension now, giving it many years to grow before they approach their own retirement in the future.

Source: Pension UK Retirement Living Standard, 2025-retirementlivingstandards.org.uk

What is the best way for grandparents to give money to grandchildren?

The best way to gift money will depend on your circumstances and the amount involved. You might consider something like a junior ISA if your grandchildren are under the age of 18. If the money is for something specific like tuition, then you might choose to pay the school or university direct.

If, however, you are considering gifting a lump sum or helping with a large purchase like a house deposit, then the value in your home could be an option. Accessing some of it could provide you with the funds needed.

Releasing equity from your home to gift money to grandchildren

If you are a grandparent whose wealth is largely tied up in property, you could still have the option to gift or save money for your grandchildren by releasing equity from your home.

Equity release is the process by which a UK homeowner aged 55 or over can unlock some of the value of their home, without the upheaval of moving to a smaller home. The most common type of equity release in the UK is a lifetime mortgage, a loan secured against your home.

With a lifetime mortgage, you borrow a tax-free cash lump sum from your home and can choose whether to make payments in your lifetime. The full amount borrowed, plus interest, is then usually repaid after the last borrower either dies or enters long-term care. It is typically repaid with the sale of the home.

If you release equity with a lifetime mortgage, the value of your estate will be reduced and your entitlement to means-tested benefits may also be affected.

Getting professional advice

To help consider how equity release with a lifetime mortgage could help you, the Telegraph Media Group can introduce you to the experts at Royal London Equity Release Advisers. They can offer you a no obligation appointment with a qualified equity release adviser, who will explain what equity release is and how it could work for your personal circumstances.

They will help you to consider the role that your property wealth could play in your plans. Looking at a range of options from lifetime mortgages to borrowing with a retirement interest only mortgage or traditional mortgage, they will help you to find the right option.

Comparing a range of products from across the whole market, they will also tell you if borrowing is not the right choice. If you’re interested, use the calculator on this page and discover how much you could release with a lifetime mortgage.

Read more:

• How does equity release work?
• Mortgages for over 60s
• How long does equity release take?

The above article was created for Telegraph Media Group Financial Solutions, a member of Telegraph Media Group. For more information please click here.

Equity release is only available to homeowners that own a property within the United Kingdom.

If you choose a mortgage with required payments during your lifetime, your home may be repossessed if you do not keep up with the payments. Borrowing with a lifetime mortgage or retirement interest-only mortgage will reduce the value of your estate. Receiving a cash lump sum may also affect your entitlement to means-tested benefits. Think carefully before securing other debts against your home.

The Telegraph Media Group Equity Release Service is provided by Royal London Equity Release Advisers. Royal London Equity Release Advisers is a trading style of Responsible Life Limited which is registered in England & Wales. Company No. 7162252. Registered Office: Princess Court, 23 Princess Street, Plymouth, PL1 2EX. Responsible Life Limited is authorised and regulated by the Financial Conduct Authority and is entered on the Financial Services Register (https://register.fca.org.uk/) under reference 610205.

Responsible Life Limited is a wholly owned subsidiary of the Royal London Group who may benefit if you choose to take regulated mortgage advice. Being a wholly owned subsidiary of the Royal London Group does not alter Responsible Life Limited’s regulatory responsibilities.

Only if you choose to proceed and your case completes will Responsible Life Limited charge an advice fee, currently not exceeding £1,690. Their adviser will talk through the setting up costs before you choose to proceed.