MUMBAI: Summer is here and for many of you, vacations mean beaches, foreign destinations and the likes. However, if you are a parent, your summer vacation may look more like summer camps and recreational activities. While such camps may be the best way to beat the heat, they do come at a cost.

Research by Arthayantra, a Telengana-based investment advisory firm, suggests that 70% of their clients are working professionals. Of these, 30% of them send their children for summer vacation camps, games, dance classes, and sports such as taekwondo. The research further suggested that on average, parents spend 5,000 to 11,000 per child for vocational activities over a span of three summer months. For most parents, these expenses fall under the ‘unplanned’ category, according to the same study. However, some make sure they make calculated expenditures while also keeping a tab on other household expenses.

For instance, Mumbai-based Priti Katkar, 39, homemaker and mother of Mishti Katkar, 11 and Eshan Katkar, 8, says that she does not have to make any special arrangements to save for the expenses that go into her children’s recreational activities. “We spend 2% of our monthly household income on our children’s camps and activities. The rest of the year, they focus on activities that take place within the school itself owing to time constraints," said Katkar. Her son attends athletics classes throughout the year. “Throughout the rest of the year, our monthly expenditure towards recreational activities drops to 1% of our monthly household income," she said. Katkar spends around 1,800 a month during summers for Mishti and 2,000 a month for Eshan throughout the year.

Porittan Sharma (left) and Neeraja Iyer say they spend around 5% of their monthly budgeton their sons’, Aarush and Atharva, recreational activities.
Porittan Sharma (left) and Neeraja Iyer say they spend around 5% of their monthly budgeton their sons’, Aarush and Atharva, recreational activities.

Pune-based Neeraja Iyer and Porittran Sarma, 41, have enrolled their sons, Aarush, 9, and Atharva, 6, to educational courses, summer camps and swimming courses for this year’s summer break. “The swimming classes cost around 3,500 per child. Since my society does not have its own pool, I have to sign up at the club nearby and pay non-member chargers," said Iyer.

They have signed up their elder son for an online coding class for the summers, which costs them around 4,500 a month. Apart from swimming and coding classes, the kids also signed up for evening soccer classes in a nearby summer camp facility. “We allocate 5% of our monthly household income to create a miscellaneous budget, which helps us fund the classes. There are fewer classes available during non-summer months, so we end up saving a considerable portion of the corpus to be spent in future months," she said.

Considering that May will be hotter, Iyer has planned most of the outdoor classes for April. “Next month, I will focus more on indoor classes like chess to beat the heat," she said. For the Sarmas, their monthly expenditure on such recreational activities is around 22% of their monthly household income during summer months. This percentage drops to 8-10% during regular months.

However, not all parents can create a corpus to provide for such activities throughout the year. If you are certain you will incur these expenditures, you should plan it well. “Parents should forecast these expenditures, earmark a portion of it," said Deepali Sen, founder of Srujan Financial Advisors. “The correct way to plan for summer vacations beforehand is to consider it a financial goal and not a residual expenditure. This way you won’t use your residual expenses, which come in handy for emergencies."

Considering it as a goal and pre-planning for the same beforehand will create more space for your investments, EMIs, loans and other expenditures. “Do not disturb your monthly planning during the summer months and pre-plan for it so that you have enough funds to suffice the vacations," Sen said. Sen also suggested that parents should not shy away from letting their children know the financial situation of the house in case their children’s demands are exorbitant.