Paying for your kid’s college education
There’s been a bit of discussion lately about whether parents should pay for their kid’s college education fully, just help or pay nothing at all. I’d like to point you to a few sites and then discuss my own opinion and experience.
First, JLP and AllFinancialMatters asked the same question as early this month. It was a short post, but I recommend checking out the comments.
Next up, Single Ma has an exceptional article explaining why she does not intend to pay for her daughter’s college education. The article is about more than just spending money for college; it is an inspiration to parents and parent-to-be on how you should teach your child to be a self-reliant and motivated adult while still holding their hand when needed. Definitely check out the post and the comments, and then take her poll.
Lastly, Mrs. Micah has an excellent article advising on ways to save money getting into and going through college. Additionally, this was part of a network writing project, so she also links to about a dozen other articles related to college spending and saving.
A Little About My College Experience
I’ll say up front that my parents paid for my housing (through loans) and food (for the first year or two), while I paid for my tuition, utilities and fun money. However, prior to even applying for college, my parents and I never really discussed who would pay for what, what my limits were or how I would get financing. Honestly, throughout college, I never really understood the financial aspect of school. All I knew was to go to the registrar, give them some information and I was good to go for a semester.
In reality, my parents set up all of the financing themselves. They paid for my off-campus housing (I never lived in a dorm) through Parent-Plus loans, while they got me Stafford loans. I got a single scholarship to help pay for tuition. In the end, my parents and I each ended up with around $20,000 in debt from college. But then again, my parents also paid for my sister’s housing as well, so their debt is doubled.
I was a smart but lazy kid back in high school (and elementary school too). Heck, I still am pretty lazy. Therefore, I didn’t really look into any scholarships or grants that would help pay for college. My two main choices for college were Notre Dame and Penn State. I visited Notre Dame during a bus trip to a Penn State football game, but ended up deciding it was too expensive to attend.
That was a case where I wish I would have discussed the financials with my family further before making an assumption. Again, I didn’t understand what options I had, and at the time I needed someone with more discipline, motivation and experience to help guide me through the process. Actually, that’s how I got the one scholarship ($4,000); my grandmother pushed me to enter the contest, and I ended up winning 2nd place. And that was with very little effort! Who knows how much I could have gotten with just a little initiative!
About Parents Paying for Their Kids
Now to the main question: Do I think parents should pay for their kids education. My answer is that parents should only HELP pay, if they can. Although I appreciate my parents taking on all that debt for me, I realize now that I would have preferred more guidance and forcefulness from them instead. I would rather that they saved that money towards their retirement rather than taken on $40,000+ in debt for my sister and I.
My state-school education landed me a well-paying job, especially compared to my parents’ wages. Once I pay off my debt, I plan to pay off the portion of education loans my parents took out for me. I don’t know how much is left of that debt right now, but I don’t want my parents to go into their 60s with all that debt hanging over their heads. And I’m pretty sure I would have to pay for that debt eventually because to my parents, it’s just too big and they have so many other debts.
I fully, 100% appreciate what my parents did for me during my college years, but I’ll restate that I would have preferred to get more help with applying for grants and scholarships than their financial help so that neither they nor I would be saddled with so much debt. It’s been almost 7 years since my graduation, and almost 12 years since I signed up for my first loan, and I just now have it down to almost 50% paid off.
So parents, please teach your kids fiscal responsibility and initiative, while continuing to guide them emotionally, spiritually and financially as-needed. I don’t recommend just throwing them to the wolves with no support, since graduating college and leaving their friends is so traumatic already. I fully support Single Ma’s stance, and if we ever have kids, I won’t be stressing over their college tuition. I’ll be focusing on our retirement instead.
My mom was strapped for cash, but the agreement was if I stayed in town for my education and maintained a minimum GPA , my rent was $200/month. That’s a great deal for housing. I got through community college fine with grants and I took some loans for my junior and senior year.
It felt good to know I was not a burden to my family and I was getting an education.
I was fortunate in that my parents paid for most of my University stuff. They paid at least 3 years of fees, housing, and gave me a small allowance to cover food and bills and books and so on.
If I have children, I will probably expect to do more or less the same. In the UK there are fewer scholarships, less variation in tuition price, and almost all funding is means-tested and ends up with cheap government backed loans. I suspect/hope that I too would be making too much money for any kids to qualify for grants, and they would deserve the opportunity to go to Uni.
Along those same lines..with what we know now about college and what it costs, why can’t parents be disciplined enough to set aside money each month for their children, earmarked for college? There are so many ways to save tax free these days….I realize there are some parents who are struggling these days and may not be able to do that…at least not right now…but what happened to personal responsibility in our society? We always seem to expect someone else to get it done for us…same goes for retirement. Social security is NOT a retirement plan! One less trip to a restaurant a month can pay for a kid’s college! May I suggest two years at a community college and then apply to an in-state GOOD school…VERY affordable, easier to get in, easier for your kid to work the kinks out before getting serious AND you get your diploma from a recognized school with no mention of doing “community college” time.
My parents didn’t pay for any of my college and didn’t help me figure out anything for it. I went to the local state college so I was able to live at home. That helped with housing expenses but it hurt me because my parents had quite a few assets so I couldn’t get financial aid. My parents charged me $20 a week which probably barely covered my food. I was fortunate that I did well in school and did get some scholarships. I was also working construction on weekends and long hours in the summer. I graduated without any loans but I hadn’t been able to pay my $20 to my parents the last year. My dad kept track of it and made me pay it after I graduated.
I want to help our kids pay for college but I also want them to have to figure out how to pay for part of it so they understand it costs. I will help them with figuring it out. I think giving a total free ride makes them not appreciate their education and not take it seriously.
Jim ~ mydebtblog.com says
I think parents should help pay for college if they can. My parents did not pay for my college and I had to put their tax information on my FAFSA form. I only qualified for so much financial aid because they have a farm, so obviously they should sell their assets to pay for my college, right? They kept their farm and I had to pay for school. I used all my savings, was lucky to get scholarships, grants, and take on a relatively low amount of student loans. I’m still paying those loans but my credit card debt is a bigger concern. It would be easier if I could have graduated debt free, but that isn’t the case. College is a great thing but it is difficult to get your start and manage the debt load. It is my intention to properly save for college one day when I have kids. I would hate to refi my house or take on loans, or have them take on loans to pay for school like I did.
Mrs. Micah says
Thanks for including my post. It was good to have my parents’ help, but I also know I couldn’t have gone where I did without all the scholarships and such.
It’s very admirable that you want to help pay off your parents’ loans. I think that’s excellent–especially since your education helped you get a good job.
I am so 100% with you CD. My parents paid for 85% of my college. But I came out of that experience thinking how much I took College for granted. I never tried for scholarships because my parents support was practically assumed. That’s why I resolved to pay half of my children’s college. I figure this way, they will know that it’s something they want, and therefore they will work harder for it. If they fight the need to go to college, well then,.. I don’t know what I’ll do. But I want to support them without giving them everything.
I think parents should help if they can. I was fortunate to get scholarships because we were poor – recent refugees with nothing, but if parents earn more than a specific amount of money, it’s difficult for kids to get enough in scholarships to cover the tuition. With some scholarships the eligibility may be determined based on merit, but the amount will still be determined based on parents’ income and their “expected contribution”. A friend of mine’s daughters both got merit scholarships, but when it came to determining the amounts, they got the absolute minimum – $2000 for each of two scholarships – because parents were earning too much.
I think if parents are poor, there is nothing they can do, but then children may be able to get enough in scholarships/subsidized loans/work-study to cover the cost. But if parents are well-off, it is irresponsible not to help their children because their children aren’t on equal footing with children of poor parents. Parents’ assets prevent their children from getting both scholarships and subsidized loans yet they don’t want to help. As a result, children end up getting private student loans and often start their careers with a lot of debt.
As to going to cheaper colleges – it depends on your field of study. In some fields school you went to is more important for future career, in others it is not as important.
Single Ma says
Hey Clever Dude
It’s nice to see we finally agree on something. 😉 Even though the link to my article is actually a link to JLP. LOL
Clever Dude says
EEK! Sorry Single Ma. I fixed the link. Sorry it wasn’t correct when I first posted this or you would have gotten more traffic. I see JLP didn’t come in and complain about it 🙂