Policygenius Survey: More Than 1 in 4 Parents Feel Less Financially Prepared to Raise Their Child Due to the COVID-19 Pandemic
One in three said they tapped savings to pay for extra expenses during the pandemic
NEW YORK, June 8, 2021 /PRNewswire/ -- More than one in four parents (26%) say the COVID-19 pandemic has made them feel less financially prepared to raise their child, according to the new Parents & Money survey from financial services leader Policygenius.
The pandemic has changed the way some parents handle their finances. In the past year, nearly one in four (23%) parents said they or their partner either scaled back or quit their job to help with their child's education or childcare. One in three said they tapped their emergency, retirement or travel savings to pay for extra expenses during the pandemic.
"The COVID-19 pandemic has been especially difficult for parents, who have had to navigate so many emotional and logistical challenges while also facing new financial challenges and uncertainty," Hanna Horvath, data analyst and personal finance expert at Policygenius, said. "Parents struggled with many unexpected financial trade-offs over the past year, like the 30% who said saving for retirement was their biggest financial stressor, while 21% named paying down debt, and 16% called out having an adequate emergency fund."
Parents who said the pandemic made them more financially prepared to raise a child were more likely to invest in financial protection: A third (33%) purchased life insurance, 13% made an estate plan and 10% started a medical expense fund. Among parents who felt less financially prepared, over half (56%) dipped into their savings, including emergency, retirement, college or travel savings.
Additional findings from the second Policygenius Parents & Money survey include:
- Looking back, 45% of parents say they were not financially prepared to have a child.
- Around 17% of parents purchased life insurance for themselves or their partner during the pandemic.
- 30% of parents say their biggest financial stressor is saving for retirement.
- 23% of parents say educational expenses put the biggest strain on their budget.
- On a lighter note, more than one in four parents would spend at least $50 to avoid a tantrum or argument with their child. Of those parents, a quarter would spend more than $1,000.
"While the pandemic has impacted every family in different ways, this can act as a reminder for everyone to set financial goals and budgets to be prepared for unexpected expenses," Patrick Hanzel, a CFP® and advanced planning team lead at Policygenius, said. "Having a financial safety net, like an emergency fund, life insurance and/or disability insurance, can help families navigate through times of economic uncertainty, like what was experienced the past year."
Policygenius' survey is based on responses from a nationally representative sample of 1,500 U.S. parents with at least one child 18 or under. It was conducted through Google Consumer Surveys from March 26 through April 21, 2021. Percentages were rounded to the nearest whole number. You can find more results from the survey here.
About Policygenius:
Policygenius is a leading financial services company that empowers people to easily shop for insurance and create digital wills and trusts. Since launching in 2014, Policygenius has helped more than 30 million people shop for all types of insurance and has placed nearly $100 billion in coverage. Policygenius is an insurtech pioneer known for its emphasis on digital convenience and consumer education. The company has received numerous accolades including four consecutive years as an Inc. Magazine Best Workplace, two years as a Forbes Best Startup Employer, being named to Crain's Fast 50 and winning a Bronze Stevie Award for customer service.
To receive Policygenius announcements, email [email protected]. Subscribe to the Easy Money by Policygenius newsletter here.
For more information:
Brooke Niemeyer
Associate Director of Media Relations
[email protected]
SOURCE Policygenius
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