Parents want the best for their children, and financial security is a big part of this. Whether it’s university costs, a deposit for a first home, or just ensuring a comfortable financial future, it’s understandable why so many adults would wish to save for their child’s future.
But what happens when parents have to juggle bills, expenses, childcare costs, a cost of living crisis and everyday life? How do they find room to save for their children’s future while also staying afloat themselves?
It is entirely possible; you just need to strike a balance between the two and maintain realistic financial goals.
Why it is vital to balance saving for yourself and your children
Of course, parents want to prioritise the needs of their children above anything else. Unfortunately, failing to protect one’s finances can lead to even worse problems down the line. It’s therefore important to maintain a realistic budget and build up emergency savings before trying to save for future financial needs.
Taking care of your own finances does not mean that you don’t care about your children. Rather, you give stability to everyone in your household.
Assess the possibilities of saving for your child
Many parents fail to set realistic goals and expect unrealistic levels of savings by the time their children are 18. Yet, it is unnecessary to aim high when even small regular payments will be sufficient in most cases. There is nothing wrong with starting small, especially when budgeting becomes challenging.
Before thinking about how much you should be saving for your child, assess your current possibilities by asking:
- What is your monthly income?
- What are your regular expenses?
- What is your existing debt level?
- Do you have any emergency savings?
- Are you contributing anything to your pension scheme?
If saving £100 per month feels impossible, that’s okay. For many it would be. Even saving £10 or £20 regularly can grow steadily over the years.
Important Factors in Achieving a Balanced Approach to Saving for Your Children
1. Create an emergency fund first
Instead of locking money away for years, build up emergency savings for unexpected costs.
An emergency fund will allow you to prepare for various situations, such as:
- Car maintenance or repairs
- Boiler breakdown
- Unplanned childcare needs
- Fewer working hours
- Travel or medical emergencies
Families who already suffer from bad credit ratings must avoid further costly debt. Establishing a rainy-day fund can be extremely useful if your situation suddenly changes.
2. Don’t neglect your pension savings
While planning to send your kids to uni or buy them a house, many parents neglect their own pensions. Unlike student loans or mortgages, there are very few lenders offering loans for retirement.
Therefore it would be best if you considered balancing your approach to saving for your child’s future and yours at the same time. Ideally, continue to make contributions to your pension account, save a small amount for your child, and increase contribution rates gradually when your finances allow you.
Having financial stability as an older parent will also benefit your child in the long run.
3. Select a suitable account
There are several types of savings accounts for children, which vary according to your goals.
Here are a few examples:
Junior savings accounts
Junior savings accounts tend to be accessible and targeted at teaching children to save money.
These accounts operate in a manner similar to those for adults and can be opened with tiny amounts of money.
Junior ISAs (JISAs)
Junior ISAs refer to tax-free savings or investment accounts for children younger than 18. In 2026/2027 parents can save up to £9,000 per year in Junior ISA accounts.
Generally, it is hard to access this money until your child reaches 18 so Junior ISAs are one of the most popular long-term methods of saving for your children.
For more information you can visit the gov.uk Junior ISAs .
Remember, though:
- Your child is entitled to access these accounts once he/she turns 18
- You won’t control where the money is being used
- Some investments can be risky
4. Teach your kids about money early
Saving money for children is not the only method of benefiting them in the future. Teaching money management skills is also very important.
Simple steps you can take to teach your child how to handle finances properly include:
- Developing a pocket money system
- Teaching your child to save up for purchases
- Involving children in budgeting groceries
- Discussing financial needs vs desires
- Encouraging kids to save up for birthdays
Early financial literacy can help ensure that you don’t end up supporting your grown-up children financially.
Small sums can make a big difference
Sometimes parents believe that only sizable monthly contributions will allow them to save significant amounts of money. Actually, even small amounts paid on a regular basis can be substantial enough by the time the child reaches 18.
For instance, it is possible to save:
- £500+ per year if you deposit just £10 weekly
- A considerable sum by saving £25 monthly from the very birth of the child
- More money by saving occasional windfalls or gifts from relatives
Consistent contributions often prove more important than the initial savings size. You don’t need to provide everything your children require – a positive influence will be sufficient.
Avoid comparing yourself to others
Financial pressure tends to arise from comparing oneself to other people, and this is not uncommon among parents.
You may be aware of another parent at school having savings or investments in JISA plans worth thousands of pounds. But remember, every family is different with their own budgets and own priorities.
What matters the most is setting up a viable strategy tailored to your financial situation.
If you don’t you may open yourself up to:
- Financial anxiety and increased stress about money
- Too frequent use of credit facilities
- Building up new debt
- Increased risk of financial crisis in the future
- Negative consequences for your own stability
Your children will benefit much more from living in a financially stable household than getting huge sums of money in the future. Finances can have a very real impact on mental health and it’s important to reach out to dedicated organisations specialise in the impact of financial worries on mental health for assistance if financial pressures are starting to take their toll. These include:
Involving family members in the savings process
If relatives want to make financial contributions to your children’s future, you can ask them to use proper savings vehicles, which might prove helpful for you and the child.
In some cases, it is possible to encourage relatives to pay for Junior ISA, savings account, educational funds, or special experiences rather than gifts.
Occasional financial support from relatives can often prove to be invaluable as this can help relieve your family from financial burden, especially when you have many children.
Keep in mind that your children’s future depends on much more than finance
People usually concentrate on financial aspects of the problem, forgetting that your child requires something else besides money in the future.
Rather than just future money in the bank children benefit from:
- Living in a stable home
- Growing up in a financially stress-free environment
- Having discussions about money management
- Seeing how balanced financial behavior looks like
- Getting a chance to learn how to budget
Sometimes it’s much better to provide kids with emotional security and financial stability than money.
Tips for saving without overextending yourself financially
Do you want to save for your child without neglecting your own financial interests? Here are a few helpful recommendations:
Automate small savings
Creating a standing order after receiving your paycheck or benefits will allow you to save automatically.
Saving money from windfalls
It may be helpful to deposit any windfalls or extra money into your kid’s savings account.
Checking expenses and subscriptions
Reviewing your expenses to identify minor costs, which can be minimized or canceled, can help you save some money without major changes in spending habits.
Gradually increasing savings rate
Once you earn more money, consider raising contribution rates a little.
Prioritising expensive borrowing
Prioritising costly debt may be beneficial for you and your family. For more information take a look at our guide on the 50/30/20 rule.
Utilising budgeting tools
MoneyHelper provides various free budgeting tools and calculators that can be quite handy in such situations.
When you are unable to save at the moment
There are plenty of households whose finances are unstable due to living costs, childcare, and other expenses. In this case, you should not feel guilty for not having a dedicated savings account for your children.
Financial circumstances can change, so you’ll eventually have the ability to save some money for your children.
Here are some periods when savings are unlikely to be possible:
- Dealing with urgent expenses
- Repaying debt
- Volatile income
- Unexpected costs
Just because your financial situation prevents you from saving for your kids right now, it doesn’t mean you haven’t done anything beneficial.
Simply teaching your children how to behave with money and budgeting properly will help prepare them for adulthood.
In summary…
Saving money for your child’s future is important, but you should take care of yourself. A balanced approach is likely to help you save without jeopardising your stability and financial security.
Here is what you should keep in mind:
- Establishing an emergency savings fund first
- Maintaining your own financial safety
- Consistently saving whatever you can afford
- Avoiding unrealistic expectations and comparisons
- Educating children about money management skills
Every contribution will help you make progress, no matter how minimal it may be.
And remember that financial security includes much more than money.
