With so many college graduates drowning in student loan debt (over $1.4 trillion is currently owed), it’s important to ask the question “Should parents pay for their child’s college costs?" Here are a few things for you to consider...
The following post is by MPFJ staff writer, Laurie Blank. Laurie is a wife, mother to 4 and homesteader who blogs about personal finance, self-sufficiency and life in general over at The Frugal Farmer. Part witty, part introspective and part silly, her goal in blogging is to help others find their way to financial freedom and to a simpler, more peaceful life.
It goes without saying that college is expensive. According to this article, the average cost of a college degree can range anywhere from $38,000 to over $133,000. If you’re headed on for a master’s degree or some type of medical or law school, your expenses can easily double, triple or more.
With so many college graduates drowning in student loan debt (over $1.4 trillion is currently owed), it’s important to ask the question “Should parents pay for a child’s college degree?”
What is the short answer? Unfortunately, there isn’t a one-fits-all answer. We all have our opinions, and there are many outside factors that need to be answered in order to help you line up your opinion with financial fact. I’m not here to give you a concrete answer to whether or not you should pay for your kid’s college degree, but I can give you some things to think about.
Beware of Encouraging an Entitlement Mentality
Probably the biggest risk that can come with footing the entire bill for your kid’s college degree costs is that you can prime the pump for your kid to start thinking he or she “deserves” to have his or her degree paid for in full by somebody else.
But, the fact of the matter is that college is a privilege and not a right, and it’s important that we start teaching our kids the difference between the two at a very young age.
As a kid who grew up dirt poor (as in empty cupboards and intermittent electric service), I learned real quick that everything we have is a privilege. Spend a week doing mission work in a third-world country, and you’ll see what I mean.
Although we all like to think that basic necessities like food and clean water are a right, those things are far from available in many countries – including right here in the U.S. - for a variety of reasons.
Teaching your kids that everything they have is a gift and a blessing – and teaching them that work equals pay and other rewards – will go a long way in helping them establish an attitude of gratitude for whatever help you give them regarding college expenses.
Establish Your Own Financial Security First
Being deeply immersed in the personal finance world on a professional level, I often see parents working desperately to rearrange their money situation in order to pay Johnny or Susie’s college tuition.
I’m a firm believer that you should have your own financial ducks in a row before forking over cash for your kid’s college tuition.
Think of it this way: Taking these years to pay off all of your debt, establish a plush retirement fund, and save a substantial amount in an emergency fund will benefit your kids for years to come, as they won’t have to find a way to support you financially when you’re too old or too sick to work.
If that means foregoing financial contributions to your child’s college education, they may be upset now, but they’ll thank you profusely later when they’re raising their own family and not having to support you as well.
Help with College Doesn’t Have to Be Directly Financial
Finally, think about ways you can help your child reduce college expenses that may not involve giving them money directly. Help them research the most cost-effective college choices. Encourage them to complete their first two years of school at a local community college.
Allow them to live at home rent-free during college so they don’t have to pay for boarding, food, and other similar expenses. Help them find used college books online so they don’t have to pay full price for the textbooks they need.
Every little bit adds up when it comes to reducing college expenses, so don’t make the mistake of writing off these seemingly small contributions to your child’s degree.
If You’re Committee to Giving Your Kids Cash for College
There’s nothing wrong with paying for some or all of your child’s college degree, necessarily. However, it’s important to do so in a way that ensures your own financial stability isn’t compromised.
It’s also important to ensure you work together with your child to find a way to cover costs, encouraging frugality and payment in cash instead of just handing them tens of thousands of dollars.
One option may be to commit to paying for half of the degree costs and leaving the responsibility of the other half to your child.
And, you can work with them to teach them the value of a dollar, the value of a hard day’s work and the skills of frugality and responsible money management.
Still, other parents tell their kids they’re not paying for anything in an effort to make sure their child is living in reality about the costs of college, only to surprise them with full payment after they’ve successfully graduated.
Conclusions
Whatever path you choose, be sure you work to set your child up for a life of responsibility – both fiscal and otherwise – as they enter into the world of the college-bound adult.
***Photo courtesy of https://www.flickr.com/photos/83633410@N07/7658225516/in/
