Education is the most important investment for child’s future: HSBC

India Infoline News Service | Mumbai |

Most parents want a university education for their child. Yet funding perceived as being tough

Parents in India, when presented with different options for supporting their child financially in life, said they would ideally allocate 33% of their funds to their child’s education, much more than anything else. The next most important priorities are funding their child's wedding (14%), financial support for starting a business (11%) and long-term investment funds (11%) according to a new report from HSBC, The Value of Education: Springboard for success.

The report, which surveyed over 4,500 parents in 15 countries and territories, examines parents’ attitudes and behaviours towards children’s education around the world.
 
Private education is seen to offer several benefits; better facilities and more equipment (44%), better teachers (36%) and better results (36%). However, some are concerned that private schools are too career focused (31%) and not worth the money (26%).
 
The majority (95%) of parents who currently have a child in paid-for education, fund it themselves, primarily through current income (83%) and savings (47%). Seven in 10 (70%) parents believe that paying for a child’s education is the best investment you can make.  However, nearly three in five (58%) wish they had begun saving and planning earlier for their child’s education. More than four in five (85%) parents would consider sending their child abroad for a better university education. Indian parents perceive the USA (62%), the UK (54%) and Australia (47%) as offering the highest quality education.

Sanjiv Sud, Head Retail Banking and Wealth Management,HSBC India
, said “HSBC’s new survey validates the high expectations of parents to support their children through tertiary and post-graduate studies. The choices parents need to make around their children’s education can be overwhelming. All these decisions require forward planning to ensure that parents make the right choices for their family and provide the best possible opportunities for their children. Parents must start planning early and ensure that saving for education forms an integral part of their long-term financial plans.


“For those who wish to send their children abroad for higher education, there will always be a  need to make overseas fund transfers. HSBC’s global footprint should only make it easier for our customers to address these requirements.”

Changing expectations for children’s education
During primary school, parents believe a good education should instil self-discipline (46%), provide happiness (44%) and develop confidence (42%).
At secondary school, parents’ priorities change. Competency in core subjects (35%) and computer literacy (35%) become the most important factors for a good education. When it comes to university education, expectations shift again. There is more emphasis on developing the skills and knowledge needed for success in later life.  More than two in five (41%) parents see income-earning potential as a key outcome of a good university education. Parents also think university should provide students with access to opportunities in life (29%), the ability to compete in the workplace (28%) and vocational /professional training (28%).

Public or Private education

Seven in 10 (70%) parents believe that paying for a child’s education is the best investment you can make. Some 38% of parents believe that private schools are better, but the same proportion (37%) of parents believe that public school education is just as good as at private schools.
Parents are more open to funding private education for later education stages. While 24% of parents would consider private education for primary school, this rises to 48% by the time their children reach secondary school.

Education here or abroad?
Over half (55%) of parents believe India has a better quality education system than the best available abroad, while just over a quarter (27%) feel the quality of education is better in other countries.Other than India (46%), the countries where the quality of education is most highly regarded, are the USA (62%) the UK (54%) and Australia (47%).
Parents with higher household incomes are more likely to regard the USA (69%) and the UK (67%) as providing the highest quality education compared with parents with lower household incomes USA (55%), UK (40%).

High expectations, tough decisions
Nine in 10 (90%) parents aspire for their child to go to university. More than eight in 10 (83%) would like their child to go on to study to postgraduate level.
While parents have high expectations, nearly half (46%) find making decisions about education daunting. This is particularly prevalent among parents living in the South (56%) compared with the North (40%) and the West (41%)
Almost all (95%) parents with a child in paid-for education are currently funding it themselves. One in 10 (10%) have help from the child’s grandparents. Current income (83%) and savings (47%) are the most popular funding sources. Just under a quarter (23%) use investments and 16% fund it through specific educational plans.


 

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