Mumbai: As families across India grapple with rising costs, a new survey by PNB MetLife and Nielsen IQ revealed parents are spending up to INR 5.30 lacs a year on their children’s education and extracurricular activities and are even willing to sacrifice their lifestyles to pay for it.

The research, titled ‘Financial Planning in the Era of Rising Education Cost’, explores the needs, influences and barriers for parents planning their children’s education was conducted in April 2023.

According to the survey, while more than half (55%) of surveyed parents said saving for their children’s education was their top financial priority, close to 30% have yet to start planning.

Additionally, 67% of the parents surveyed expressed a strong concern about accumulating funds required for their child’s education, citing cost increases on account of infl­ation and fears of an economic slowdown threatening their income stream. Even among those who have invested in an education plan, 72% of the parents are worried if it can meet future financial requirements, highlighting the need for a more comprehensive insurance product that can safeguard a child’s education needs even in the scenario of the loss of one or both parents.

Commenting on the findings Sameer Bansal, Chief Distribution Officer at PNB MetLife said the results indicate why parents should start planning for their children’s education expenses early, “In the current backdrop of rising inflation and economic growth trends, parents are increasingly finding it challenging to plan and prioritize financial planning for their children’s future education needs, and this is corroborated by the survey that PNB MetLife has conducted with Nielsen.”

“More than 1 in 3 parents misjudge the expense they would incur and end up overshooting their budget by ~27%. At PNB MetLife, we believe in supporting the aspirations of both children and their parents through life insurance solutions that offer flexibility when it comes to saving, while also protecting against unforeseen risks. With parents expecting educational expenses to nearly triple over the next ten years, it is important for parents to start planning early to ensure a more confident future for them and their children,” Bansal said.

The research highlights the potential benefits a customized Child Education Plan can offer in enabling parents to secure their children’s future while balancing lifestyle and protection needs.