Parents are getting ready to spend an average of
$400 for each of their children this holiday season-and are considering
replacing toys with college savings contributions, according to a new
Although children may not be happy to hear this, financial advisors should embrace the trend as leverage for encouraging college saving, according to Fidelity Investments, a seller of 529 plans and sponsor of the study.
"More than a third of flows to 529 plans typically come in the fourth quarter giving season, so there is a natural opportunity for advisors to help clients make a connection between holiday gifts and college savings," says Martha Willis, executive vice president of Fidelity Investments Institutional Services Company, which manages the company's 529 plan offerings.
The study is based on answers from 310 parents nationwide with household incomes of $75,000 or more.
Among the findings is that 90% of respondents consider a contribution toward college savings a more valuable gift than toys or games, according to the "Toys and Tuition" survey.
One-third of the parents said, looking back, they would replace previous gifts with college savings contributions.