TD Survey: Parents Sacrificing Financial Security to Support Children’s College Education

August 27, 2024 TruthUSA

A recent survey has revealed that more than 90 percent of Canadian parents are financially assisting their children through post-secondary studies at the expense of their own financial stability.

According to a survey conducted by TD Bank Group, 94 percent of Canadian parents provide financial support to their children during their university and college years. Of these parents, 71 percent admit that this support leaves them struggling to fulfill their own financial obligations and engage in additional activities.

Nearly half of students report difficulties in covering basic needs such as food and housing, with 65 percent describing their financial status as unstable, as per the survey findings.

Emily Ross, the vice president of Everyday Advice Journey at TD, commented on the survey results, stating, “Our survey indicates that many Canadian post-secondary students desire more knowledge about budgeting and financial management, and it’s positive to see their interest in seeking advice.”

Ross also advised caution when using social media for financial guidance, noting that online sources are often not tailored to individual circumstances.

Of the parents providing financial assistance to students, 58 percent believe the support they offer is significant.

Financial Literacy

Parents expressed concerns about their children’s spending habits, with 87 percent noting the need for improvement in their children’s budgeting skills.

“Our survey reveals that Canadian parents recognize areas where their children’s financial knowledge and spending behavior could be enhanced,” Ross remarked.

Sixty percent of parents believe their children should improve their spending habits, 42 percent suggest enhancing financial literacy, and 37 percent feel their children should rely less on them for financial aid.

The survey also recommends that 27 percent of parents advise students to utilize financial apps to monitor their budget and expenses.

The survey data was gathered from surveys of 1,029 randomly selected adults online, comprising 514 students and 515 parents of college or university students, conducted from July 26 to Aug. 4.

A similar report by Equifax Canada indicated that younger Canadians exhibit a higher likelihood of missing a credit card payment.

Despite 18- to 25-year-olds having the lowest average debt of $8,072 among all age groups, they have the second-highest delinquency rate, as per Equifax Canada.

In 2024, delinquency rates for 18- to 25-year-olds surged by 13.23 percent to 1.86 percent. Overall debt for this age group increased by 3.23 percent, according to Equifax.

The only age group with a higher delinquency rate than 18- to 25-year-olds are those aged 26 to 35, with a rate of 1.99 percent.

The report authors noted that inflation and escalating costs are affecting all Canadians, with younger generations potentially seeking financial aid from parents due to economic pressures.

“With limited job prospects, soaring rent and housing prices, and the high cost of living, young Canadians are increasingly reliant on their parents and grandparents for support,” stated Rebecca Oakes, vice president of advanced analytics at Equifax Canada.

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