should parents pay for college

Should Parents Be Expected To Pay For College?

Michael Lux Blog, Student Loans 6 Comments

Figuring out how a college education will be funded is a huge challenge.  Before we get into the man considerations that families need to consider, lets first clear out a couple misconceptions.

  • Parents are under no legal obligation to pay for their child’s education.  (Yes, there are some very limited circumstances, such as when required by terms of a divorce, but for the vast majority of the time, this rule holds true.)
  • Working hard during the summer, and even during the school year, is no longer sufficient to fund a college education.  Many parent’s may have paid for their entire education by working menial jobs, but what was possible a generation ago is no longer achievable due mostly to rampant tuition increases.

When making college finding decisions there are no hard and fast rules.  It really comes down to what is best for each individual family.  Issues to consider include finances job outlooks, best interests of the parents, and best interests of the child.

Here are some of the more important considerations:

Ability to Pay Now

This is a major consideration due to the time value of money.  Student loans often have interest rates that easily outpace nearly all interest bearing accounts and many types of investments.  This means that the money you have today will pay for far more school than the money you will have in 20 years.

Ability to Pay in the Future

This is where the ability to contribute really shifts.  Most parents have far more cash on hand then their children and are in a much better position to help pay upfront.  However, as the years go by, the ability for most children to pay for the debt will start to exceed that of their parents.  Looking 20 or 30 years into the future most parents of college age children will want to be retired and will likely be living on a fixed income.  For students planning on college, most would expect their prime earning years to be in the next 20 to 30 years.  The lesson here is that students may be in the best position to handle the long term obligations of student loans.

Cost of Education

A family’s ability to pay for college is directly related to the cost of the education.  If junior decides to go to a community college or State school, mom and dad might be able to pay for most of junior’s schooling.  However, if junior insists on the expensive private school or overpriced for-profit university, it will be much harder for mom and dad to shoulder the costs.

Lessons Taught

Parents need to carefully consider the impact that their decision will have on their child.  On one hand, paying for a child’s education can be a valuable lesson on the unending love a parent has for their child and the importance of sacrifice.  However, the same action can potentially spoil a child and leave them with an entitled attitude.

What is the best practice?

Figuring out how to pay for college should be a team effort.  Thousands of Americans have made decisions that haunt them to this day.  Time and effort spent selecting the right school and funding plan is essential.

College should be an exciting time in life, not a source of hostility or regret between children and their parents.  Time spent researching, asking questions, and learning from the mistakes of others could pay dividends.

  • I think that saving for the education of your children is well advised. I don’t necessarily think that the parents should be asked to pay for every expense, but to expect kids to pay 100% these days is pretty much a recipe for disaster given the cost of education these days.

  • As a parent, there is no obligation, however I think education is the best gift you can give your children. I not only paid for their college, but k-12 too (private school). There are ways to reduce the cost such as community college, state universities and scholarships. Encouraging your children to do their best is just part of parenting and it does payoff by reducing college costs.

  • While there is no obligation, I disagree with many who think kids should just get student loans as a way to get an education. As a parent, we spend 18 years teaching them how to do things, preparing them for the world, and doing everything for them. Once we get them to college, we drop them off, hand them the bill and tell them to pay for it. I don’t agree with it. With smart planning and creativity, you can pay for your kids education. My parents did it for me and I wouldn’t be where I am today without the boost of no debt.

    Not starting adult life with massive debt gives you a leg up many other people would love to have. While it’s not my obligation, I feel it’s my responsibility to give them something which will help them out for the rest of their life.

  • squirrelers

    I think that it’s the minimum job of a parent to provide a kid with basic needs, nurturing, love, and skills to become an adult. As a part of that, providing a foundation that allows a kid to survive and thrive independently is what it’s truly all about. How that manifests itself in terms of paying for college might really depend on the parents and their own ability to do so. Some might be able to help provide only room and board so a kid can go to a local commuter campus – while others pay for the whole thing at a private university.

  • I think paying for your kid’s college education is optional and parents shouldn’t feel guilt if they decide not to pay. For us, right now the plan is to set aside money for the essentials of a in-state college program. If our daughter wanted to attend an out of state college program, that’s on her to figure out how she’ll pay. I think working through college can be beneficial, you have to learn to juggle things and budget.

  • “Figuring out how to pay for college should be a team effort.” – I completely agree. parents and kids should work together on figuring out the plan that best fits their situation.