Family wealth dictates our life choices. So is the Bank of Mum and Dad now behind so many of society’s growing inequalities?

You know the Bank of Mum and Dad when you see it: it’s your friend who seems broke, but always has a safety net, or who suddenly (but discreetly) acquires the deposit for a home. It’s those who stayed with their parents while they saved for a flat, or stuck it out in a profession they were passionate about even though the wages are chronically low. It’s those who do not need to consider the financial costs of having children. It’s those whose grandparents are covering nursery or university fees, with the Bank of Grandma and Grandad already driving an economic wedge between different cohorts in generations Alpha (born between 2010 and 2024) and Z (born in the late 1990s and early 2000s).

This is the picture we know, but the Bank of Mum and Dad is not just a luxury confined to the 1% – it is also evident in families like mine. I grew up in a working-class household and was the first person in my family to get a degree, but it was the fact my parents had scrimped in the 1980s to purchase properties in London (and allowed me to crash in one throughout my 20s) that has arguably been the true source of opportunities in my life.

In recent years, we have rightly widened the conversation about privilege in society. And yet how honest are we about one of the most obvious forces shaping anyone under 45: the presence or absence of a parental safety net? The truth is that we live in an inheritocracy. If you’ve grown up in the 21st century, your opportunities are increasingly determined by your access to the Bank of Mum and Dad, rather than by what you earn or learn. The economic roots of this story go back to the 1980s, but it accelerated after the 2008 financial crisis, as private wealth soared and wage growth stalled. In the 2020s, rather than a meritocracy – where hard work pays off – we have evolved into an inheritocracy, based on family wealth.

  • JustinEnglish
    6•1 month ago

    None of that is relevant to the idea of affordable housing for college students because 18 year olds going to college haven’t had the chance to start working yet.

    I don’t think I was particularly lazy as a student just because I got free college and $1k a month student loans from the Swedish welfare state, and a free apartment from my parents, all without working a single hour for pay.

    I remember some of my strongest drivers in college were my social life, the opportunity to enter an exchange program, passing 75% of my classes to keep my student loans, and my personal interest in the things I studied. So some monetary/quasi-monetary, but also many social. And none of them based on wage labor.

    Also, while social democracy like what I’ve described doesn’t reject your ideology, there are also people who work for other reasons besides money, and there are more forms of unpaid work than there are for paid work.

      • JustinEnglish
        1•1 month ago

        So we are both describing social democracy

        • @FourPacketsOfPeanutsEnglish
          1•1 month ago

          Coming at the same thing from opposite sides as it were. The political movements I linked to have enjoyed at times broad support in Germany and the UK and elsewhere in Europe. They consciously reject ‘hard’ socialism as (regrettably) unworkable. They deliberately seek well functioning safety nets for the vulnerable and less able but see a well regulated 'fair" capitalism as being essential to unlocking people’s creativity and initiative. And that means allowing people to better themselves through their efforts. Equal opportunity not equal outcomes (but safety nets to prevent excess).