BabyCenter and Charles Schwab Survey Also Reveals That Despite Good
Intentions, Parents Aren't Doing Enough to Secure Their Child's Future
SAN FRANCISCO, Oct. 16 /PRNewswire-FirstCall/ -- The hot new gift for
today's baby showers isn't the typical onesies or cute stuffed animals. In
a BabyCenter/Charles Schwab Survey released today, results reveal that
seven out of 10 new moms (71 percent) and two in five mothers-to-be (40
percent) would prefer contributions to a child's savings account over any
other gifts.
According to the survey, moms, pregnant women and women who are
planning families have the best intentions to save money for their new
child. However, they lack follow-through when their child arrives. An
overwhelming majority of women (93 percent) who are planning families
intend to open a college savings account when they have a baby. However,
less than half (42 percent) actually open a savings account anytime after
the baby's birth, and only four in 10 (40 percent) contribute $50 or more
per month.
The BabyCenter/Charles Schwab survey of 2,800 women also reveals that
finances give parents pause before starting a family. Nearly half of women
(49 percent) feel their plans to become pregnant are affected by the cost
of having a baby. Further, 40 percent of those surveyed said they delayed
starting a family because of financial concerns. The number one concern of
those women surveyed is being able to afford a child's education, followed
by hospital delivery bills, clothing, medical bills and childcare.
One of the biggest advantages that new parents have on their side is
the power of time. According to Rene Kim, senior vice president of Schwab
Investor Services, families who begin to save at a child's birth can save
$17,000 or more by the time the child is 18 with just $50 a month. This
number is reduced significantly to only $6,800 at the same rate of savings
if parents wait until the child is 10 years old.
"Many of today's new families are simply not aware of the family
savings options available to them," said Kim. "From high-yield savings
accounts that produce more savings than traditional accounts to 529 plans
and education savings accounts, today's parents have a variety of options
to help them work towards a more financially secure future for their
children."
"It's never too early for parents to start planning for their
children's futures," said Jessica Lilie, vice president of Marketing and
Analytics at BabyCenter. "Experts are predicting rapid increases in college
costs; tuition fees for four year universities rose between 5 and 7 percent
between 2006 and 2007. Even $50 dollars a month invested today can make a
big difference 18 years from now. The saving for college guide at
http://www.babycenter.com gives parents additional ideas for starting to
save for their children's educations."
Other Noteworthy Statistics From the BabyCenter/Charles Schwab Survey
Include:
-- Moms' priorities are slightly skewed. Half of moms (50 percent) who
currently have not opened a college savings account cited that they
could not afford to do so, yet overall 45 percent of moms say they
spend $50 or more on toys and clothing each month for their child.
-- Moms are calling on grandparents for help. Most moms agree that their
parents were more financially secure than they are (54 percent) and
40 percent of pregnant respondents said they want their parents to open
savings accounts for their child.
-- Today's moms learned money habits by example. More than half of moms
(59 percent) feel that their parents set a positive financial example.
However, only 45 percent were explicitly taught about money management
and investing growing up.
Parents interested in learning more about ways to save for their
children's' futures can visit http://www.babycenter.com or
http://www.schwab.com to find information, college savings calculators and
other guidance on how to plan and save.
Survey Methodology
Members of the BabyCenter panel (maintained by Socratic Technologies)
were sent email invitations to take this survey from Aug. 10, 2007 through
Aug. 15, 2007. A pop-up survey was also launched on the BabyCenter site
targeting the pre-conception audience. Of the 40,000 emails were sent,
there were a total of 3,076 respondents who started the survey; 2,800
completed the survey for a response rate of 7 percent. The survey was
branched to deliver preconception, pregnant and mom audiences with
different set of questions. Only female U.S. residents over the age of 18
who are currently pregnant or have children or are trying to conceive were
allowed to take the survey.
About BabyCenter(R)
BabyCenter, LLC operates http://www.babycenter.com, the largest online
resource for expectant and new parents around the world. Having nurtured
more than 100 million parents since its launch in 1997, The BabyCenter
international sites attract over 6 million monthly visitors, and provide a
trusted online destination for parents in Australia, Austria, Canada,
China, Germany, India, Sweden, Switzerland, the United Kingdom and in
Spanish for U.S. Hispanics. In the U.S., BabyCenter reaches over 78 percent
of new and expectants moms online with its content, community and online
commerce and has garnered numerous prestigious awards including six Webby
Awards. The editors at BabyCenter have also authored two guidance books,
The BabyCenter Essential Guide to Pregnancy and Birth and The BabyCenter
Essential Guide to Baby's First Year. BabyCenter, LLC is based in San
Francisco, CA and is a member of the Johnson & Johnson (NYSE: JNJ) family
of companies.
About Charles Schwab
The Charles Schwab Corporation (Nasdaq: SCHW) is a leading provider of
financial services, with more than 306 offices and 6.9 million client
brokerage accounts, 1.2 million corporate retirement plan participants,
212,000 banking accounts, and $1.4 trillion in client assets. Through its
operating subsidiaries, the company provides a full range of securities
brokerage, banking, money management and financial advisory services to
individual investors and independent investment advisors. Its broker-dealer
subsidiary, Charles Schwab & Co., Inc. (member SIPC, http://www.sipc.org),
and affiliates offer a complete range of investment services and products
including an extensive selection of mutual funds; financial planning and
investment advice; retirement plan and equity compensation plan services;
referrals to independent fee-based investment advisors; and custodial,
operational and trading support for independent, fee-based investment
advisors through its Schwab Institutional division. The Charles Schwab
Bank, N.A. (member FDIC) provides banking and mortgage services and
products. CyberTrader(R), Inc. (member SIPC, http://www.sipc.org) is an
electronic trading technology and brokerage firm providing services to
highly active, online traders. More information is available at
http://www.schwab.com.
BabyCenter, LLC and Charles Schwab & Co., Inc. ("Schwab") are separate
entities, but co-sponsored the survey. Schwab has not reviewed and is not
responsible for the content on the BabyCenter website.
SOURCE Charles Schwab Corporation; BabyCenter, LLC
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Related links:
http://www.schwab.com
http://www.sipc.org http://www.babycenter.com
CONTACT:
Lara Edge of Charles Schwab, +1-415-636-3386,
Lara.Edge@schwab.com; or Regan Daniels of BabyCenter,
+1-415-845-0208, Regan.Daniels@BabyCenter.com
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