Sept. 3, 2019:
Many parents encourage their kids to play organized sports because they believe the experience will be good for their physical and mental well-being. Athletic participation often provides an opportunity to instill discipline and develop social skills that could have a positive impact on their children's futures.
But kids play has morphed into big business. In 2018, the size of the U.S. youth sports market was estimated to be about $17 billion.[1]
The costs can really add up at more competitive levels, when payments for professional instruction, specialty equipment, and travel kick into high gear. On average, families with children who competed on elite teams spent an average of $3,167 per player in 2018, up from $1,976 in 2013.[2]
Lofty hopes and dreams might inspire some parents to overspend on youth sports. In fact, surveys suggest that many parents are willing to make big financial sacrifices to cover athletic costs, possibly even taking on credit card debt or delaying retirement.[3] Unfortunately, some parents may have unrealistic expectations, such as those who are confident their children will become professional athletes, despite the very long odds against it.
Parents who assume that investing in athletics will pay off with college scholarships are also likely to end up disappointed. Only about 2% of high school athletes benefit from athletic awards, and few of them are "full rides." Coaches often have more roster spots to fill than available scholarships, so many athletes receive partial awards that may cover only a small fraction of tuition costs.[4]
Although most parents have good intentions, there may be some unhealthy side effects. According to a 2016 research study, young athletes whose families devoted a large portion of their household income to sports felt more pressure to succeed and were less likely to enjoy the experience.[5] And even if their kids love to play, parents should attempt to keep the costs in an affordable range so that other important financial goals (such as saving for college and retirement) are not neglected.
[1] WinterGreen Research, 2018
[2-4] The Wall Street Journal, April 21, 2019
[5] Family Relations, April 2016
Provided by Doug Fletcher - Prepared by Broadridge Investor Communication Solutions, Inc. Copyright 2019.
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