Working Parents Struggling to Build up Retirement Funds due to School Fee Planning
According to research carried out by HSBC Mena working parents in the United Arab Emirates (UAE) are forced to choose between saving for their children’s university education, or saving for their retirement. Unsurprisingly, it is often their retirement funds that are sacrificed.
Khalid Elgibali, head of retail banking and wealth management, HSBC Mena said: “There is an aspiration-reality gap. When you talk to parents with young kids, who are the ones who should be thinking of planning for the future now, 66 per cent say ‘not to worry, I’ve got savings set aside’.
“Wind the clock forward and only 40 per cent end up finding enough to fund university. This is a worrying situation. There is a huge gap, which points to that there is no replacement for seeking advice and starting to plan for these things early. When you fail to plan and then you find, ‘OK my kid is going to university, oh God it’s going to cost me this!’… then your retirement plan has gone for a toss for the next few years because you’ve not planned for education. So it’s important to plan ahead.”
The research spoke to 5,550 UAE parents from sixteen countries 450 of which were based in the UAE.
Most financial planners believe that parents are not necessarily getting value for money from their investments, and better financial planning will not only make their budgets stretch that little bit further, but it would be possible to put money aside for a university education as well as put money aside for retirement.
The other aspect to consider, is that your current savings plans and financial vehicles good enough to help you fulfil your financial aspirations? This is very difficult to tell, without professional financial planning knowledge.
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