It's no surprise that raising children is expensive, but a new survey finds a shocking number of parents are spending more than they can afford on their kids' extracurricular activities.
The website www.CompareCards.com surveyed 700 parents and found that 62% of them said they've gone into debt trying to pay for activities. Of them, 27% said they owe more than $3,000, and 9% said they owe more than $5,000.
Most believe it's a good investment, according to the study. Eight out of 10 parents surveyed said they believe the extracurricular activities will lead to higher paying jobs for their kids someday. And that belief seems to be stronger among parents who spend more money.
Ninety percent of parents who spend at least $4,000 a year on activities believe it will earn their child money someday. However, for those who spend less than $1,000 a year, only 75% believe in a big payoff down the road.
While most parents agree extracurricular activities are beneficial for their children, the survey found 64% of parents feel stressed about paying for them.
Experts have some advice for allowing your children to explore and compete without breaking the bank.
"My kids loved to do everything... once," said Rachel Namoff, a Denver financial literacy expert.
She said she recommends signing up for free trial classes while the kids are still figuring out what they enjoy. Community centers and schools may offer lower cost activities. You might be able to volunteer to coach instead of paying a fee. And as your kids get older, make sure they chip in their own money.
Finally, experts say parents should encourage and support their children, but stay realistic about the long-term payoff. Depending on the sport, the chance of going from the NCAA to a professional league can be as low as 1%.