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Canadian Parents Are Willing to Go Into Debt or Even Defer Their Retirement to Put a Child in Hockey and Other Activities
TORONTO, ONTARIO--(Marketwired - Nov 12, 2013) - Three out of five Canadian parents (61 per cent) say they, or someone they know, have borrowed money or used their retirement savings to put a child through hockey or other extracurricular activities.
The average household spends $1,500 on hockey-related expenses1 - less than the typical Canadian household invests in education savings ($1,455 per year). Fewer than half of Canadian households have a Registered Education Savings Plan or RESP (45 per cent) 2, even though families know they should be putting money aside for school before hockey.
A Leger survey commissioned by CST Consultants (CST), one of Canada's largest RESP providers, shows that 60 per cent of parents agree that it's more important for them to start saving for post-secondary education before spending money on extracurricular activities like hockey.
The survey also revealed that an overwhelming majority of parents, 89 per cent, believe it's important for parents to help their child pay for their post-secondary education, especially with tuition fees on a steady increase.
Average university tuition fees increased by 3.3 per cent to $5,7723 a year for an undergraduate degree in 2013, and could be as much as $9,000 a year by 2026 (based on a 4 per cent year over year rate increase).
Parents are spending as much as $10,000 a year for their children to play hockey according to the book Selling the Dream.
"Some parents spend a lot of money on hockey. And that's OK. We should all chase our dreams. But what about the dream of post-secondary education? There are parents who are willing to spend $10,000 a year for their kids to play hockey, but not balance that with an RESP investment," says Ken Campbell, senior writer at The Hockey News and author of Selling the Dream. "I'm often asked, 'What do I need to do for my son/daughter to get a scholarship?' And I tell them, 'If you take all the money you're investing in hockey and put it into an RESP, your son (or daughter) won't need a scholarship.' About 0.1 percent of the kids who play hockey will appear in just one game in the NHL. Many, many more will go on to university or college."
"We love hockey. But extracurricular activities shouldn't come at the price of investing in your child's future," said Peter Lewis, Vice President at CST. "This survey shows that Canadians believe that planning for higher education should be a higher priority. An RESP for your child should be a must, especially with the Canadian government matching 20 per cent of the first $2,500 in annual contributions. It's money offered by the government and a tax-deferred way to save for your child's future."
What the numbers say:
38 per cent of parents say they, or someone they know, have borrowed money (credit card, line of credit, personal or family loan) to put a child in extracurricular activities such as hockey or swimming.
23 per cent of parents say they, or someone they know, have deferred their retirement or are using their retirement savings (RRSP) to put a child in extracurricular activities such as hockey or swimming.
51 per cent of parents say they, or someone they know, is spending more money to put a child in an extracurricular activity over an education savings plan like an RESP.
The Leger survey was completed between October 1 and October 3, 2013 with a sample of 1503 Canadians 18+. A probability sample of the same size would yield a margin of error of +/- 2.5 per cent, 19 times out of 20.
CST encourages parents to learn more about RESPs and start investing in their child's future.
As parents we all dream to see our children do well in life. With that in mind CST is launching a new community education initiative. We're inviting hockey communities - teams or associations - to tell us what they're doing for their community and to encourage the educational success amongst their players. In turn, they will get the chance to compete for $10,000 to go towards their program and help alleviate the cost of hockey for parents. To learn more about this program, visit: www.beyondtheblueline.com
1Royal Bank of Canada 2011 survey
2Employment and Social Development Canada (formerly known as Human Resources and Skills Development Canada) - Annual Statistical Review 2012
3Statistics Canada - The Daily - University Tuition Fees 2013/2014, September 2013
About CST
The Canadian Scholarship Trust Foundation is a non-profit organization that has been helping families save for post-secondary education for over fifty years. As a wholly-owned subsidiary of the Foundation, C.S.T. Consultants Inc. (CST) is the distributor and manager of the Canadian Scholarship Trust Plans. Focused exclusively on growing and protecting its planholders' savings, CST currently manages $3.8 billion in assets for over 280,000 Canadian families. CST boasts a sales force of 640 located across the country. The Canadian Scholarship Trust Foundation offers its own awards for academic achievement and community engagement to those students in their Group Plans who are pursuing graduate studies. For more information about RESPs at CST go to www.cst.org or follow us on twitter @cstconsultants and like us on Facebook.
