Household Budget tested raising kids

But is it money well spent?

Many households forsake financial security and family well-being.  They do this by various loans and debts to pay for the schedules of their overbooked offspring.  It’s no coincidence that the cost of most kids’ activities are growing at a higher rate than inflation.

More and more businesses are tapping into the spending power of the child. Psyche-savvy advertisers know how to ignite the feeling of bad parenting.  Unsurprisingly, parents are willing to forgo their own necessities than stop paying for their children’s – expensive – activities.

A survey in the UK found that the cost of children’s extracurricular activities rose by 67% in the 2000s.  That was double the rate of inflation in the same period.

These figures may not be as extreme in Australia.  However, activities like piano lessons and sporting activities cost considerably more now than was the case even five years ago.

Parents complicit in household budget testing

Financial planners confirm that parents invariably resist cutting back on kids activities to tighten family budgets.

“It’s a well-known business fact that when it comes to things that affect us emotionally, we’re usually prepared to pay a hefty premium for goods and services. And there is nothing that hits our emotions harder than parent guilt,” Justine Davies, a Financial Planner, says.  Ms Davies advises parents to look for activities that are free or subsidised.

“Local councils offer lots of fantastic free activities for children such as art and craft classes and there are always museum and galleries to visit.  For older children, sporting organisations often sponsor local club activities, which can make things much cheaper.”

Psychologists point out that over-scheduling a child can not only strain the household budget but family health as well.

A Let’s Play survey found that 47 per cent of Australian parents experience “family fatigue” running children around to activities.  And that was based on 2010 data!  It has to be said that while learning to play a musical instrument may bring a child lifelong success, parents shouldn’t count on it turning them into a genius.

Dr Andree Brooks, psychologist and author of Children of Fast-Track Parents says exposing children to many extracurricular activities can hinder their mental health.  “In our efforts to produce Renaissance children who are competitive in all areas, we squelch creativity and their learning ability,” Dr Brooks says.  “Some children are simply not able to function well with so many responsibilities and can develop stress disorders.”

Other child experts echo Dr Brook’s concerns.

Dr Alvin Rosenfeld, a psychiatrist and author of The Over-Scheduled Child, says enrolling children in too many activities is a western world problem.  “Over-scheduling our children is not only a widespread phenomenon, it’s how we parent today,” he says.  “Parents feel remiss that they’re not being good parents if their kids aren’t in all kinds of activities. But they are putting their children under extreme pressure to achieve and be competitive.”

Is your household budget tested raising kids?

The team at Continuum Financial Planners Pty Ltd can guide you in planning for the relevant financial costs – and working to a family budget.  To see how we can be of value to your wealth management planning in this regard, make an appointment with one of our experienced advice team – contact our office,

• phone our office, on 07-3421 3456; or
• at your cpnvenience, use the linked Book A Meeting facility.