Parents List Children’s College Education as Priority
(Springfield, MA) – Asian Indians make up the highest earning segment of American multicultural groups, according to a 2010 Pew Research Center survey, and much of their higher household income goes toward saving for their children’s college education, according to a recently released study from Massachusetts Mutual Life Insurance Company (MassMutual), the third biennial 2013 State of the American Family Study that offers a broad snapshot of Americans’ financial views. This heavy emphasis on higher education, however, leads to times when Asian Indians prioritize saving for their children over saving for themselves.
The study indicated that Asian-Indians are savers; 33percent of Asian Indian respondents indicate that they have six months or more of their monthly living expenses set aside as savings, and their top two financial priorities for their savings are for their children’s college education and keeping the family financially shielded. As a result, one quarter of Asian Indians struggle between saving to pay for their children’s college education and saving for their own retirement.
“Being an Asian Indian myself, I know and understand the importance that the community places on putting family first and the difficult financial decisions that often result,” said Nimesh Trivedi, director of multicultural market support, U.S. Insurance Group at MassMutual. “With the current cost of a college education, it can be challenging for parents to provide for several children’s education and still be left with a surplus for their own future.”
Asian Indian’s savings rate is not coincidental; as a group they are hands-on, when it comes to their finances. An overwhelming 70 percent of Asian Indian respondents want to be actively involved in all decisions regarding their finances, while just over half indicated that they tend to do their own research and make their own decisions about insurance and investments.
Yet, in spite of having some solid financial planning in place—they are more likely to own mutual funds, individual securities and college savings plans than any other group--only about a third are satisfied with their current financial situation and one third are worried about being able to meet their long-term financial goal.
Additional findings from the survey further illustrate Asian Indians’ strong tendency to put family first:
• Sixty-seven percent of Asian Indians think about what is best for the family when making financial decisions.
• Three quarters of Asian Indians believe that it is important to educate their children about finances to ensure a strong economy in the future.
• Seventy percent feel it is important not to burden their own children with the cost of caring for them when they get older.
To learn more about Asian-Indian families from the 2013 State of the American family Study, visit www.massmutual.com/familyfinances. For information about planning your financial future, logon to www.massmutual.com/asianindian.
The State of the American Family study is a biennial survey conducted in 2009, 2011 and 2013 for MassMutual by the Forbes Consulting Group, LLC. The 2013 study was conducted between February 4 and 25, 2013 via a 20-minute online questionnaire. The survey comprised 1,337 interviews with American households with children under age 18 for whom they are financially responsible. Interviews were conducted among men and women aged 25-64 as of 2013 with household incomes greater than $75,000 (50 completes were allowed among 25-32 year-olds with HH incomes falling between $50,000 and $75,000). Respondents had to contribute at least 40% to decisions regarding financial matters in their household to qualify. Results were weighted to the 2010 US Census distributions for age, gender, ethnicity, region, and same sex married/partnered couples to be representative of American families in this age and income bracket. This study includes trending data for survey waves conducted in 2009 and 2011.
Founded in 1851, MassMutual is a leading mutual life insurance company that is run for the benefit of its members and participating policyowners. The company has a long history of financial strength and strong performance, and although dividends are not guaranteed, MassMutual has paid dividends to eligible participating policyowners consistently since the 1860s. With whole life insurance as its foundation, MassMutual provides products to help meet the financial needs of clients, such as life insurance, disability income insurance, long term care insurance, retirement/401(k) plan services, and annuities. In addition, the company’s strong and growing network of financial professionals helps clients make good financial decisions for the long-term.
MassMutual Financial Group is a marketing name for Massachusetts Mutual Life Insurance Company (MassMutual) and its affiliated companies and sales representatives. MassMutual is headquartered in Springfield, Massachusetts and its major affiliates include: Babson Capital Management LLC; Baring Asset Management Limited; Cornerstone Real Estate Advisers LLC; The First Mercantile Trust Company; MassMutual International LLC; MML Investors Services, LLC, Member FINRA and SIPC; OppenheimerFunds, Inc.; and The MassMutual Trust Company, FSB.