Another study/survey, another demonstration of just how out of touch great gobs of parents are when it comes to their child’s chances of securing an athletic scholarship for college.
How out of touch? In this latest research into the financial habits of youth sport parents, TD Ameritrade discovered a staggering number of ways that parents are sacrificing their existing and future finances to fund their kids’ sporting activities. Examples include:
- 27% of parents (especially dads) spend $500+ per month on youth sports
- More than 20% of families spend $12,000 per year
- One-third of families take fewer vacations to fund their kids’ sports activities
- Roughly 20% of parents take a second job or delay retirement to pay for youth sports
- The same percentage of parents reduce savings and retirement accounts
If these figures don’t shock you, consider that one-in-five families are spending the same amount each month on youth sports as the average American mortgage ($1,030).
Alas, despite what these parents may think, these dollars are being spent, not invested. At least not for collegiate scholarships anyway.
“The finances don’t make sense,” says Villanova University professor Rick Eckstein, an expert on youth sports. “The financial payout is exaggerated in the eyes of families.”
Even the NCAA takes pains to point out how exceedingly rare athletic scholarships are. The organization notes that just 2% of high school athletes receive a scholarship offer from a university, and of those only 1% receive an all-expenses-paid ‘full ride.’
That means that that 2% are, in many if not most cases, receiving token financial support relative to cover their university costs. Furthermore, it means that a lot of those youth sports expenses would have gone farther in a real investment account, retirement savings, or even a good old-fashioned, experience-laden family vacation.
None of this means parents should stop spending on youth sports, though perhaps we should dial it back some and let kids get back to playing just for playing’s sake. Youth sports is, in fact, good for kids in many ways: increases self-confidence, teaches teamwork, and so on.
So mom and dad, if you’re going to spend big bucks on youth sports, at least be honest about what it’s likely to buy you and your kids (a college scholarship isn’t part of it).