When it comes to their children and their futures, many moms and dads are willing to spend top dollar to make sure that they become the next Tiger Woods or a future Serena Williams on the tennis court. But are parents overpaying when it comes to their children’s sports teams and extra-curricular activities? One finance expert says that that might be the case.
A new survey by CompareCards.com finds that many parents are willing to invest in their children’s after-school activities simply because they think that it will someday lead to income for their child. However, about two-thirds of parents have gone into debt trying to keep up with all of the tournament fees, camps, equipment and jerseys for their children’s sports teams.
CompareCards Chief Industry Analyst Matt Schultz says that many of these same parents are getting themselves into some serious debt by using credit cards to help pay for all of these fees. But what they don’t realize is that they might be paying too much.
According to the survey, about 90 percent of parents say that they spend more than $4,000 per year in the belief that their child will one day benefit or earn money from the sport they are participating in. About 75 percent of parents who spend less than $1,000 on activities per year feel the same way. Among those who are finding themselves in debt, about 90 percent believe that a vast investment in their child’s future will one day pay off.
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A lot of parents also revealed that they are worried about their finances, and do stress out about keeping up with the payments associated with their children’s activities. Over 60 percent say that they're unable to sleep at night because they can't stop thinking about all of the money they're spending on camps and private lessons for their kids. 52 percent say that they're spending more money than they can afford, thus digging themselves into a massive financial pit. An additional 48 percent say they don’t regret it at all.
It’s been noted though that only a small percentage of high school athletes continue to play their sport in college, while only a fraction of that percent go on to make any money from their sport. So if your child is involved in some sort of after-school activity, it's best to be careful when you determine jut how much money you're willing to invest. Your bank account will surely appreciate it.