We all love our kids and our grandkids. I am self-appointed “chief fun officer” to my own grandchildren and am sure many other grandparents are equivalents.
Be that as it may, what do you buy them for their birthday? A bike, a scooter or any Paw Patrol, Octonauts and Go-Jetters paraphernalia are still gratefully received by mine.
But how about something other than a toy for a present? How about a savings plan of some sort? How practical. How thoughtful. How easy. How appropriate as an introduction to the principle of deferred gratification…
“I thought you said you were chief fun officer!” I hear you say. “That doesn’t sound much like fun to me.”
Well, no, not immediately. But in a few years, with decent performance and tax efficiency, realised when money is more important than toys, maybe then it is fun. You see, deferred gratification.
Mind the education gap
Get this: a quarter of UK parents regret not saving earlier for their child’s education and one in five say they wish they had saved more, according to new research from HSBC.
It seems more than 70 per cent of UK parents contribute towards the cost of their child’s education, be that fee-paying schools, colleges or university.
In a few years, with decent performance and tax efficiency, realised when money is more important than toys, maybe then it is fun.
Despite this, less than half of those questioned said they had started thinking about such costs before their child had began primary school. This compares to 60 per cent of parents in the rest of the world.
Twenty per cent of those UK parents interviewed said they would be willing to cut back on holidays to fund their child’s education, and 14 per cent said they would work longer hours to keep up with such costs.
Nearly three-quarters said they relied on day-to-day income to fund their child’s education – and, no doubt, trips to all-important theme parks. I am not joking on this last point, creating and sharing great experiences with your children and grandchildren is a pretty important and worthwhile investment in my book. Of course, theme parks do not have a monopoly on this; I just use them as an example.
The research also found that almost half of UK parents did not know how much they were spending on their child’s education. This was the highest proportion of any country in the survey, with the global average being 22 per cent.
HSBC says UK parents with a child in paid-for education can spend about £128,600 over the course of primary, secondary and tertiary education.
The report found parents in Asia lead the way in terms of planning ahead. More than half of parents in China said they funded their child’s education through general savings, investments or insurance, and more than two-fifths through a specific education savings plan.
In contrast, fewer than one in 10 parents in the UK (5 per cent), Australia (8 per cent) and Mexico (8 per cent) choose to fund their child’s education through a specific education plan.
HSBC stated that “in nine of the 15 countries surveyed, paying for their child’s education is most likely to be parents’ biggest financial commitment, above others such as mortgage or rent payments and household bills”.
Whatever may happen politically in relation to government support of higher education costs, there is a real need for informed advice to attack this wide open door of opportunity.
Done well this will benefit parents, grandparents, children and the advisers putting in the time and expertise to deliver excellent outcomes.
Tony Wickenden is joint managing director of Technical Connection. You can find him Tweeting @tecconn