Photo Credit: Angsulee
Monday we talked about some of the basic expenses of having children. One of the costs we didn’t talk about though was paying for your kid’s college education.
I don’t believe parents should always be responsible for paying for their kid’s education. It’s a personal decision.
I’ve seen children who get a free ride through school (provided via their parents) who change their majors like they change outfits and don’t take school seriously. In fact someone pretty close to me has been working on a two year associates degree for four years now! And her parents pay the full cost.
I’ve seen students who’ve paid their own way who remain focused during school, party less, and are overall more responsible.
So covering the costs of your child’s education isn’t going to automatically make the child successful or responsible.
Should I Pay for My Kid’s College Education?
As a parent I can’t fathom my daughters beginning their adult lives with mountains of student debt. And because of this I do want to help my kids through college, if that is the path they wish to take. (And I hope that is the path they wish to take!)
With that said I’m still undecided on whether it’s a good idea to try and pay for everything. But it’s always better to be safe than sorry.
And by teaching my kids responsibility now I can (hopefully) avoid them feeling self-entitled as they begin their adult lives.
How Much Should I Save?
I completely agree with the financial experts when it comes to the order of saving for the cost of a kid’s college education. My financial goals and retirement funding have to come before saving for their college. After all, they can always resort to student loans. I, however, won’t be able to take a loan out to fund my retirement.
According to my research the annual tuition for a state university is approximately $15,000 per year. So if I were to pay for four full years of college I would need to have $60,000 per child.
To do this I would need to save $413 per month for my oldest daughter. I would need to save roughly $377 a month for my youngest daughter. This accounts for inflation and assumes a 6 percent return on investment.
I think it is important to save, but also to consider financial aid and student loan assistance while doing so. This doesn’t mean that you shouldn’t save as much, but that you should encourage your child to apply for every scholarship or grant they can. Since it is unlikely for most parents to be able to save up enough money to cover all of the expenses associated with college, scholarships are necessary. Make sure to check the school’s website to see what grants they offer, as most schools present a wide variety of options. Follow these steps and your child should have minimal issues with debt after graduation.
While I do want to help my daughters in every way possible this seems like quite a bit for me to be saving right now. I’m going to have to keep making smaller contributions until I get all of my other financial goals straightened out.
Do you plan on paying for your kid’s education? How much do you save per month?