TORONTO – If past practice is any indication, the majority of post-secondary school students will likely run out of money before the school year ends — and end up turning to the Bank of Mom and Dad for help.
A new poll from CIBC (TSX:CM) has found that 51 per cent of post-secondary students tapped their parents for additional financial support last year because they ran out of money.
And according to the bank, there wasn’t much difference between students from higher- and lower-income families.
CIBC said some 48 per cent of students from families with household incomes of more than $125,000 tapped their parents for extra cash, compared with 52 per cent from families with household incomes of less than $75,000.
Sarah Widmeyer, managing director and head of Wealth Advisory Services, at the bank, said that even though 86 per cent of parents surveyed considered themselves good role models for financial planning, some students were treating their parents like personal ATMs.
Widmeyer said young people need to understand that their parents may not always be willing or able to dispense extra cash and that being taught basic financial and budgeting skills before they go off to college or university is essential.
“Clearly, being a good financial role model doesn’t mean your children will understand how to manage their own finances,” she said.
“That’s why it is so important to teach them the importance of balancing a budget in their early teens because it’s a much a tougher lesson to learn when they are off living on their own for the first time in their lives.”
The online survey was conducted Aug. 13-17 among 1,001 Canadian parents who are Angus Reid Forum panellists.
The polling industry’s professional body, the Marketing Research and Intelligence Association, says online surveys cannot be assigned a margin of error because they do not randomly sample the population.