Research by the mutual found that more than one in five working adults (21%) expect to provide financial support to their grandchildren during retirement, while almost half (48%) are concerned about running out of money in later life.

Skipton’s modelling suggests someone aiming for a moderate standard of living in retirement would need a pension pot of around £370,000 between the ages of 67 and 88, based on the Retirement Living Standards.

However, providing grandchildren with £250 a month would increase the required pension savings by around £58,000, taking the total to approximately £428,000. Those giving £500 a month could require an additional £116,000 in retirement savings.

The research found those expecting to support grandchildren anticipate beginning to do so at an average age of 65.

Helen McGinty, head of financial advice distribution at Skipton Building Society, said: “While many families will naturally want to support their grandchildren where they can, whether that’s contributing to education costs, childcare, clothing or simply giving regular financial support, its important people don’t assume this support will simply fit within their existing retirement plans.

“These gestures can make a real difference to family members, but these costs need to be planned in for, as even relatively modest amounts of regular support can add tens of thousands of pounds to the retirement savings needed over a lifetime. Also, the answer isn’t always just saving more into a pension. For some people, they may want to review how their assets are structured, plan for the tax implications of gifting and exploring where other products such as junior ISAs may help support younger generations.

“What’s right for one family won’t necessarily be right for another, which is why planning ahead is so important. With changes to inheritance tax rules bringing pensions more firmly into estate planning in 2027, people should consider looking at their future finances holistically.

“Worryingly, a third of people don’t know how much they’re contributing to their pensions each month, so the earlier you plan your pensions alongside any additional assets, the more options and flexibility you’ll have later on.

“It’s also important to consider how best to spread your retirement pot across your lifetime, especially as health and lifestyle needs change. Understanding what you’ll need to fund your own lifestyle first can help ensure you’re able to support loved ones without compromising your financial security. Small steps taken today can make a huge difference to how comfortably—and confidently—you’re able to live in the future.”

The findings highlight the growing financial pressures facing retirees as many seek to balance their own long-term financial security with supporting younger generations.