In a trend that will only get more defined with the rising costs of education, more and more college-bound students will be responsible for all or most of their tuition, fees, and room and board. A recent Discover Student Loans survey asked parents of 16 to 18 year-old children about their concern and ability to save for their children’s education. Here’s what it revealed.
College is important.
Of the people polled, 96% believed that college is important to their children’s future. And while 48% of parents believed that cost would not be a factor when choosing a school, 44% said they would limit the college choices based on price and 33% said they would limit funding based on their child’s major.
Financial independence is hard won.
The percentage of parents who planned to pay for their children’s education went down 4% from last year, and the number of parents who believe their children should pay for most or all of their education has steadily risen. Almost 75% of the families polled say they are worried about being financially able to cover college costs. This, coupled with the fact that 4 out of 10 millennials are “overwhelmed” by debt, makes it difficult to decide who should carry the financial burden of college.
Expectations need to be clear and managed.
Danny Ray, president of Discover Student Loans, puts it simply, “It’s important for parents to have clear and honest discussions with their children about how they’ll pay for college. Students need to understand the financial responsibilities they take on and, more importantly, who is responsible for the repayment of loans upon graduation.” If the parents offer a no-strings policy on university or major, it’s important they follow through with that; likewise, if a student wishes to pursue a college outside of his or her family’s financial comfort zone, they may need to find other resources to pay for education.
Use the college financial aid office.
Speaking of necessary resources, college financial aid offices ranked as the most trusted resource for information for the third time in a row. If free money or additional loans is what you seek, your college financial aid office can help make it happen.
In the end, a joint effort to save for college may be the most beneficial for both parents and children. It may relieve the responsibility born entirely on the parents and also give the students a chance to learn valuable lessons about long-term commitments and money well spent
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