Pensions shunned to fund kids' education
By Jennifer Hill
LONDON (Reuters) - A quarter of parents are cutting the pension saving to fund their children's education, a poll shows.
Some 23 percent of 1,983 adults polled by YouGov say the cost of learning -- whether extra tuition, university fees or private education -- is having a negative impact on their ability to save for retirement.
They are diverting an average 57 pounds per month from their pension for education, while some are holding back as much as 300 pounds a month, according to the research for MetLife.
Education costs rose 13.2 percent last year, according to the Office of National Statistics, compared with an increase in the headline consumer price index of just 2.1 percent.
Some 565,000 pupils in England attend independent schools, at an average cost of 9,000 pounds per year, data from the Independent Schools Council shows.
Ed Gardner, chief executive of MetLife UK, says: "In the current economic climate, everyone's finances are under strain and it is understandable if people cut back.
"Paying for education is a vital investment in the future of our children, but it is worrying when that investment is being made at the expense of future retirement income."
The same principle applies to investing for a child's education as pension saving -- the earlier you start, the better, says Andy Gadd, head of research at independent financial adviser Lighthouse Group. Continued...
© Thomson Reuters 2008. All rights reserved. | Learn more about Thomson Reuters
