As student and graduate debt increases, ISIS Asset Management is warning that the families of most teenagers are financially ill-prepared for the cost of higher education.
Furthermore, it points out that the government's planned Child Trust Fund (CTF) will not be sufficient to cover the expected costs of a degree for future generations.
Jason Hollands, director of communications and strategy at ISIS said: "Last year we commissioned an independent survey which revealed that only 28 per cent of parents and grandparents are making financial provision for their offspring. And of these just 48 per cent are doing so specifically to fund education costs and just four per cent to cover student debt."
A survey by Barclays Bank in May this year found that graduate debt levels have risen by 500 per cent over the last decade.
When the introduction of variable tuition fees is taken into account the ISIS survey estimates average graduate debt levels will rise to £33,708 by 2010.
Mr Hollands believes the problem of graduate debt "will be compounded by the fact that an ever growing number of young people will be starting their working lives later than in previous generations."
According to ISIS even parents who are able to top-up CTFs to the proposed maximum sum of £1,200 per annum are unlikely to raise the sufficient funds to cover the projected future costs of a university degree.
ISIS has calculated that a saving of £1,200 per year for 18 years, experiencing six per cent annualised growth would generate a total sum of £35,887, barely little more than the projected cost of a degree in six years time, let alone 18 years in the future.DeHavilland Information Services plc