Fewer parents helping to pay for college
NEW YORK (CNNMoney) — Though parents still agree that a college degree is extremely important, fewer are planning to shell out their own money to help their kids attain one.
About 77% of parents say they plan to help their child pay for college — down from 81% last year, according to a Discover Student Loans survey of 1,000 adults.
Many of these parents say they would like to help but are worried about their own finances and simply don’t have enough money to put toward college costs. About three in four families surveyed said they are “very” or “somewhat” concerned about having enough money to help pay for college.
Instead, a growing number of college-bound kids are taking out loans to cover the costs or are being asked to pay for these expenses out of their own pockets.
In fact, 15% of parents said they believe their children should pay for every cent of college on their own — up from 12% in 2012. Another 32% said their children should pay for most costs, compared to 27% in 2012.
The trend has been similar when it comes to repaying loans, with fewer parents saying they plan to help their kids make loan payments — despite the fact that the vast majority of respondents said they are “very” or “somewhat” worried that student loan debt will make it harder for their children to make important purchases in the future, like buying a home.
“As students prepare to enter college this fall, it’s important for parents to have clear and honest discussions with their children about how they’ll pay for college,” Danny Ray, president of Discover Student Loans, said in a statement. “Students need to understand the financial responsibilities they take on and, more importantly, who is responsible for repayment of loans upon graduation.”
The majority of parents are still helping out with at least some college costs, however. And while some of them — about 33% — said they plan to limit their aid based on the major their child chooses, more than half said they will help out no matter what their child decides to study.
And nearly every respondent, or 96%, said they continue to view a college education as valuable — explaining why 48% of parents say cost won’t have an impact on the college decision-making process, up from 40% in 2013.
“It is promising to see families recognize the investment in a college education and are considering their children’s long-term financial health beyond graduation,” said Ray.
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