MUMBAI: As more people seek education abroad, an HSBC survey has found that parents end up spending much higher amounts than the estimated cost for their children's undergraduate studies overseas due to lack of realistic planning, while this gap is highest in the case of Indians.
Starting to save early and seeking professional advice can help parents meet their children's education aspirations.
According to HSBC's 'Learning for Life' survey, Indian parents are willing to pay the maximum premiums (60 per cent) to send their children abroad for higher education. They have misjudged the cost which is disproportionately short of the actual cost of education for undergraduate studies abroad.
HSBC surveyed 5,550 parents across 16 countries and the findings reveal that on average, the extra cost of an international undergraduate education is 6.3 times more than parents would consider paying. This shortfall is the biggest among Indians, the survey said.
"Our findings reveal that there is a huge expectation mismatch between the costs factored in for an international undergraduate education by parents in India as compared to the actual cost of a foreign education," the survey said.
"Therefore, there is a need for parents to realistically consider the costs, reevaluate their savings and plan accordingly so that they can support their children's ambitions," HSBC India Head of Retail Banking and Wealth Management S Ramakrishnan said.
The additional funding required by parents to send their children to universities abroad can vary significantly between countries.
The report further revealed that the US is regarded as offering the best quality of education worldwide, but the total cost of attaining an undergraduate degree there as an international student can exceed Rs 1.09 crore, making it the most expensive destination globally.
For Indian parents, the additional cost of sending their children to any university in the US, rather than to a domestic university, is 12.6 times more than the premium they would consider paying.
This is because in India, where a domestic university education is the least expensive of the 16 countries, parents regard the most expensive destination overall - the US - as the best of all for its high quality education.