It’s no secret that parenting today is much different than it was a generation ago. Today’s youth are always on the go. While parents may have enjoyed sports when they were younger, they are finding that their children are a part of a new world of competitive sports that has taken things to the next level. Instead of a game on the weekend and a practice one evening during the week, young athletes may practice several times a week and travel for games and tournaments—sometimes hours from home. And with that level of competition comes not only a big time commitment, but a financial commitment as well.
As a result, parents may be forced to make financial sacrifices and budget cuts in other areas of their lives in order to fund their children’s athletic aspirations. The same could be said for parents with children who excel in dance, music or any other number of disciplines. The fact remains that helping children pursue their dreams can take a financial toll on parents. In addition to cutting back on extras like family vacations, many parents also find themselves cutting back on putting money into savings and retirement accounts.
According to a recent survey of 1,001 sports parents conducted by TD Ameritrade, parents spend an average of $100 to $400 per child, per month on elite youth sports. Some reported spending $1,000 or more per month.
A vast majority of these parents (60 percent) said that the cost of youth sports leaves them with concerns about being able to adequately save for the future, and yet, 57 percent said they have no long-term financial plan. And while many of these same parents hope their children will land an athletic scholarship to help with the cost of college, only 24 percent of the children of those surveyed actually received such a scholarship. This reality makes it all the more important to start planning for the future now.
Making a Plan
What can parents do to ensure a secure future for both their children and themselves? The best place to start is by setting financial goals, this is a key step in working toward any dream. Research shows that people who have a savings plan with specific goals are more likely to make progress toward fulfilling their savings or investing targets.
So it is essential to define what it is that you are saving for. Is it a dream vacation? Being able to contribute a certain amount of money toward a child’s college education? Is it retiring by a certain age? Whatever the goal, clearly define it and document it.
Once the goal is clear, the next step is to create an action plan. Prioritize what you hope to accomplish and then begin to detail a timeline and establish milestones to serve as a guide to get there. Using an online retirement calculator or other free financial resources can help you stay on track as you work toward longer-term goals.
You may find that having regular budget meetings can help ensure you are reaching milestones on your timeline. Parents surveyed reported that while they spend an average of 10 to 12 hours per week on their kids’ sporting activities, they only average three hours or less on finances. Just like anything, it’s just as important to spend time on your financial goals. Reviewing your plans regularly allows you to make the adjustments you need to in order to stay the course.
It’s important to remember that you have to start somewhere, even if it’s a small step. Start by taking advantage of online goal planning tools and calculators that can help lay the groundwork for reaching financial goals. Putting in the time now can help establish a clear vision of what financial success looks like down the road, whether your dreams include sending a child to college or buying a dream house and retiring on the beach.
This article was originally published on The Huffington Post.