Table of Contents
Introduction and Abbreviations
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- Report methodology
- Definitions and report coverage
- Global information and research
- Consumer research
- ACORN
- Abbreviations
Executive Summary
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- UK child population is declining
- A difficult savings environment
- The key findings of Mintel’s consumer research
- Frequency of saving is proving a problem
- Profile of parents who save regularly for their children
- Penetration of children’s savings products
- Funding children’s education is parents’ top savings priority
- A range of products and providers adorn the marketplace
- Distribution mix
- Advertising expenditure
- The market’s potential for growth
Market Factors
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- Average family size has declined significantly since the mid-19th Century
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- Average family size for the constituent countries of the UK (actual and assumed), 1950-2000
- Fertility rates have been falling at younger ages and rising at older ages
- The changing structure of households
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- GB households and family types, at spring 1971-2002
- The last two decades have seen an increasing proportion of lone-parent families
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- Percentage of all children in GB living in different family types, at spring 1981-2002
- Distribution of household savings
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- Distribution of household savings, by family status and amount, 2001/02
- Socio-economic profile of parents
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- Percentage of GB households with children aged 0-15 in each socio-economic group compared to all households, 2002
- Household income profile of parents
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- Percentage of GB households with children aged 0-15 in each income bracket compared to all households, 2002
- Low savings ratio as consumers choose to spend not save
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- Total PDI, consumer expenditure, savings and the savings ratio, at constant 1998 prices, 1998-2007
- Recent poor stockmarket performance may have deterred parents from investing in equity-based investments
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- FTSE 100 and FTSE All Share, daily prices, September 1995-August 2003
- Consumers less enthusiastic about the state of the economy…
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- Headline confidence and consumer expectations regarding personal finances – index movements, September 2001-August 2003
- …while savings activity is set to improve
- The costs associated with bringing up children are used to great effect in marketing literature
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- Average cost of educating a child from nursery to university, 2003
- New Child Trust Fund aims to strengthen the saving habit of future generations
Market Size
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- There are 6.9 million family households and 10.9 million children under the age of 15 in the UK
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- UK child population, by age, 1998-2007
- Just under two fifths of parents save regularly for their children’s futures
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- Proportion of adults saving for children, by frequency, August 2003
Children’s Savings and Investment Products
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- Ownership of children’s savings and investment products by all adults and families, August 2003
- Bank and building society savings accounts are the most popular children’s savings product
- National Savings & Investments offer security and tax benefits
- ISAs also offer tax advantages, but cannot be held in a child’s name
- Stockmarket-based investments hold less appeal among parents, despite the potential for higher returns
- Children’s savings plans provide a disciplined way of saving
- Children’s savings bonds offered by banks and building societies
- A trust fund enables adults to nominate stockmarket investments for children
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Key Players
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- Composition of the children’s savings market
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- The children’s savings and investment market, by type of company and product, 2003
- Banks and building societies
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- Top 11 children’s accounts, by gross AER as at £100, September 2003
- Friendly societies
- Insurance companies
- Investment companies and fund managers
- Selected company profiles
- Abbey
- Baillie Gifford
- The Children’s Mutual
- Edinburgh Fund Managers
- Family Assurance
- Homeowners Friendly Society
- ISIS Asset Management
- National Savings & Investments
- Royal Liver Assurance
Distribution
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- The main routes to market
- Case profile: NS&I’s distribution mix
- Strengthening relationships with independent intermediaries
- Depolarisation will enable more tie-ups between friendly societies and other financial institutions
Advertising and Promotion
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- The largest amount of adspend in 2002/03 went on monthly savings plans
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- Total advertising spend on selected savings and investment product groups, by type, 2001/02 and 2002/03
- Almost £5 million was spent on advertising children’s monthly plans from August 2002-July 2003
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- Top ten advertisers of children’s monthly plans in 2002-03
The Consumer
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- Some 27% of the population have children under the age of 15
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- Profile of total sample, by lifestage and presence of children in household, August 2003
- The vast majority of parents have just one or two children
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- Number of children aged 0-14 in household – family lifestage group, August 2003
- Just under two fifths of parents save regularly for their children
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- Proportion of adults in family lifestage group that save for their children, by frequency and number of children in household, August 2003
- Women are more conscientious than men when it comes to saving for their children
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- Profile of the family lifestage group versus those who save regulary and occasionally for their children, by age, gender and socio-economic status, August 2003
- 77% of those who save regularly for their children are married couples
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- Profile of the family lifestage group versus those who save regulary and occasionally for their children, by marital status, age and number of children and detailed family lifestage, August 2003
- Personal wealth is a key determinant in the children’s savings market
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- Profile of the family lifestage group versus those who save regulary and occasionally for their children, by working status, gross annual household income and tenure, August 2003
- Internet users show an above-average propensity to save regularly for their children
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- Profile of the family lifestage group versus those who save regulary and occasionally for their children, by TV region, ACORN category, newspaper readership and new technology users, August 2003
- A small but significant proportion of adults are saving for grandchildren and other children
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- Proportion of adults that save for grandchildren and other children, by frequency, August 2003
- ABs most likely to be saving for grandchildren or other children
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- Profile of respondents that save regularly and occasionally for grandchildren or other children, by demographic sub-group, August 2003
- Just over a fifth of people saving for grandchildren are working full-time
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- Profile of respondents that save regularly and occasionally for grandchildren or other children, by working status, gross annual household income, TV region and ACORN categoriues, August 2003
- Take-up of children’s savings product is greater among regular savers
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- Savings and investment products held for/on behalf of children, by frequency of saving, August 2003
- The highest take-up of children’s savings plans is shown among ABC1s aged 18-34…
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- Products held with intention of saving for child, by demographic sub-group, August 2003
- … and those with annual household incomes above £35,000
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- Product held with intention of saving for child, by working status, gross annual household income, new technology, newspaper readership, TV region and ACORN categories, August 2003
- Funding children’s education is parents’ top savings priority
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- Main motivations for saving for children, August 2003
- Almost 50% of regular savers are putting away money for child’s university education
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- Main motivations for saving for children, by frequency of saving, August 2003
- Parents are more likely to have a specific reason in mind
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- Main motivations for saving for children, by demographic sub-group, August 2003
The Future
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- The market’s potential for growth
- The macroeconomic environment will continue to be a mixed blessing
- Market inhibitors …
- … versus market drivers
Forecast
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- Adults who save for their own children or other children, by gender, age and socio-economic group, August 2003
- Scenario 1
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- Forecast of adults who save for children, scenario 1, 2003-07
- Scenario 2
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- Forecast of adults who save for children, scenario 2, 2003-07
- Scenario 3
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- Forecast of adults who save for children, scenario 3, 2003-07
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