What's more important to you....Your retirement or your kids' college fund ??

Canadians are more adamant about saving for their child’s education than other western nations according to a global report by HSBC.

The survey of 6,241 parents in 15 countries, including 434 Canadians, found that 72 per cent of Canadian parents have started saving for their child’s education compared to 65 per cent in the U.S., 53 per cent in Australia, 46 per cent in the UK and 43 per cent in France.
Cynthia Kett, principal of advice-only planning firm Stewart and Kett Financial Advisors Inc. in Toronto, says the findings are in line with what she’s experienced among clients.
“I would say that the majority of our clients – almost all – who have young children are saving for their children’s ‎post-secondary education,” she says. “If they haven’t started yet, they intend to do so.”
But parents aren’t the only ones footing the bill. While 96 per cent of those Canadian parents surveyed expect to be the main contributor to funding their child’s education, half expect their kids to contribute if they go to university. In fact, 39 per cent of parents say their university-aged children are already helping to pay for college, making Canada stand out in this regard among the other countries surveyed.
Of course the funds may come with strings attached.
The survey found that nearly two thirds (62 per cent) of Canadian parents say they do have a preference when it comes to the career path their kid pursues. The after-school programming stereotypes are alive and well with fathers being the most likely to point their kids towards a certain career based on it earning potential whereas those mothers surveyed took a more balanced approach ranking individual strengths first, followed by the child’s choice and finally, income.
More important than retirement
Lower income households have a greater propensity to invest in their kids schooling over investing in their own retirement. According to the survey, 53 per cent of Canadian parents with household incomes below $65,000 say helping to pay for their kids education is more important than retirement, compared to four in 10 households above that income cutoff.
The sentiment bodes well under the Liberal government’s plan to increase the maximum Canada Student Grant for low-income students to $3,000 per year for full-time students, and to $1,800 per year for part-time students while halting loan repayment until students have graduated and are making at least $25,000.
But it doesn’t have to be either/or when it comes to retirement savings.
“By having a financial plan to meet their family’s overall needs and reviewing it regularly, parents will be better placed to support their children’s studies without compromising on their own long-term financial goals,” Betty Miao, executive vice president and head of retail banking and wealth management for HSBC Bank Canada, said in a news release announcing the findings.
That’s where registered education savings plans come into play, adds Kett.
“Parents want to take advantage of the Canada Education Savings Grants offered by the federal government through RESPs,” she says. “Where else can you get a guaranteed 20 per cent rate of return on your savings?”
Her advice for the three in ten who haven’t gotten around to saving for their children’s education:

“Start now, track your spending for a while to see where you can reduce expenses to enable education savings (and) implement pre-authorized periodic transfers to RESPS and/or other savings accounts,” she says.  

The earlier you start, the more you will have to offer your kids when the need arises. Also, if you start the fund when the kids are babies, your contributions can be smaller and therefore easier to handle. The interest will compound over a longer period of time. The hard part is not slacking off on the payments when things get a little tight. Our kids are the future and it would be a blessing if they had more on the ball than us.