The financial responsibilities of any parent can be myriad, but at the end of the day they boil down to one set of clear functions: protect, raise, educate and help one’s child grow to a healthy, functioning adult who can contribute to the world. This one sentence generally incorporates 18 or more years of dedicated support, trials, decision-making, stress, and more to help a child successfully make it from a tottering toddler all the way to a self-sufficient adult.
There is no question that parents have to provide the basics. In most countries and jurisdictions parents are actually required to provide for their children by local law. Failure to do so can land a parent in jail very quickly. This includes food, shelter, clothing, medical care, and similar basic needs of living.
Along with the physical basics, parents are also financially responsible for providing their kids with a solid education that will make them a useful adult when they grow older.
However, just providing minimum requirements is not a pass for good parenthood. Where children need additional resource or have the ability to take advantage of opportunity, parents should find a way to support them. This will not always be the case, as many a family has dealt with challenging economic times when prioritisation is a requirement. That said, where additional help can be provided financially, it usually should. That may be in the form of tutors, additional training classes, or extra curricular activities.
Programs outside of core school education are also valuable as well. They often provide the ability for children to learn new skills as well as learn how to function in a group. Sports are often the most popular, teaching kids how to work with others for goals and objectives. These programs do have costs in most cases, and kids have to pay these fees to remain a part of the given program.
Children and teenagers will regularly trigger other expenses that need support, so the idea of getting down time from handling finances for a child is a myth. Instead, a parent is often called upon around the clock to solve problems or acquire new things a child wants. Most of these are gift or entertainment requests, unfortunately, and have no serious value, so spending on them should be controlled.
Don’t forget a holiday
Everyone needs a break, even parents. So what better way to achieve this than by going on a holiday. The ability to relax is a great idea for getting children back into the mode of learning again a few months down the line. Holidays often mean using funds for lodgings, food as well as transportation, but the ability to bond as a family and reduce stress is, most experts agree, helpful for the long-term health of a family.
In my view, parents should avoid looking at their child’s educational cost as “yet another bill to pay.” While a good education can be expensive, the dividends are huge on a child’s success later on as adult.
As I confirmed in a recent press release: “With our research showing that three out of four parents under-estimate the true costs of educating their children, it is highly recommended that parents explore all the options available to them with an expert independent financial adviser as early as possible.”
Most financial advisers I hope would actively work with their clients, who would benefit from doing so, to build education planning into their long-term financial strategy to allow those individuals the best opportunities to be able to give their child or children the best possible start in life.
Blog published by Mike Coady, Group Managing Director – Swiss Global Group.