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Give the young £10,000 and fix society

There is, we are told, a divide; a desperate unfairness in society which if left unrepaired will make the young practically homeless, debt ravaged and “increasingly angry”.

So, says a radical report from the research and policy think-tank The Resolution Foundation headed by former Universities Minister Lord Willetts, we should give the young £10,000 at age 25, taken from higher property taxes on the older generation. We should scrap Council Tax in favour of a new property tax to target wealthier homeowners, as well as make those above state pension age pay National Insurance on their earnings, says the report.

The foundation’s Intergenerational Commission report says this will fund a £10,000 grant to the young to help pay for education or a house deposit and to pay for a halving of Stamp Duty for First Time Buyers as well as increasing public funding for social care.

Financial product design is better left to the experts rather than government (Stakeholder Pensions, anyone?) but the argument for radical tax reform to rebalance society is  one that can be made.

Launching the report on May 8, Lord Willetts said: “We still feel the obligations that generations have to each other, and families are incredibly important in discharging those obligations.”

That’s a contract, he said - and that contract has broken down.

Though, and this is important, they did win the War

“Families are doing their best, the Bank of Mum and dad helping out the kids, younger people caring about their grandparents, but when you look at public policy, there are older people worried about their social care, there are people of middle age who still aren't owner-occupiers, and that's what they want to be, and there are younger people whose pay is no higher than it was 10 or 15 years ago, so there's a problem in public policy."

We see the problem all too clearly, particularly in helping first time buyers onto the property ladder. So we help families who want to help.  Our innovative Family Mortgage, for example, is designed to make home ownership for first time buyers easier and less expensive than would otherwise be the case.

It offers three key ways (which can be used individually or combined) to allow the family to help out.
Firstly, a family member can place money in a security account. As well as paying interest, it counts towards the amount used for the security without actually having to ‘gift’ the money.

Secondly, the Family Mortgage allows a family member to offer some of their own property’s value as security for the new property.

And lastly, if family members are unsure of future commitments, our Offset Account allows the family members to use their savings to help reduce the amount of mortgage on which interest is charged.

Better still, it’s not just Mum and Dad that can help but any close relative. Grandparents, aunts, and uncles can all help to club together for the deposit.

Just one way that innovative lenders like the Family Building Society can help give your younger folk a leg up the ladder.

Hardly radical, but our customers find it works.

For more information on the Family Mortgage, talk to one of our friendly and highly trained staff on 03330 140140.

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Family Building Society
Ebbisham House
30 Church Street
Surrey KT17 4NL
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