78% Wealthy Indian Parents Send Kids Abroad Without Adequate Financial Planning: Report

Only 53 per cent of these affluent parents have established an education savings plan for their children's overseas studies

The report highlights that many of these parents prioritise their children's international education over their own retirement planning

Source : Pexels

Approximately 78 per cent of wealthy Indian parents either plan to send their children abroad for higher education or currently have a child studying at foreign universities, according to the HSBC "Quality of Life Report 2024.” However, these parents often fall short in terms of financial preparedness for this goal. 

The report highlights that many of these parents prioritise their children's international education over their own retirement planning.

The forecast predicts that more than two million Indian students will study abroad by 2025. As education expenses continue to rise, financing becomes a significant concern for parents. The study reveals that funding a three or four-year degree in sought-after locations such as the US or the UK could potentially consume up to 64 per cent of their retirement savings. This finding is based on a survey of 1,456 affluent Indians.

Only 53 per cent of these affluent parents have established an education savings plan for their children's overseas studies. Meanwhile, 40 per cent anticipate that their child will need to take out student loans, and 51 per cent are hopeful for scholarships. Additionally, nearly one-third (27 per cent) are prepared to sell assets to finance their child’s education.

The study also underscores that the challenges of securing adequate funding, choosing the right course and university, and meeting admission requirements significantly increase stress for Indian parents.

In addition to examining the costs associated with overseas education, the study explored attitudes towards financial goals, health risks, and the effects of rising healthcare expenses as well as physical and mental health challenges.

Globally, affluent individuals express significant concerns about the escalating cost of living, high inflation, health issues, increasing healthcare expenses, and inadequate retirement savings. Among Indian respondents, the primary financial goals are supporting their families (45 per cent), building wealth for financial security (41 per cent), investing in real estate (40 per cent), saving for their children’s education (40 per cent), and planning for retirement (38 per cent).