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It's your child's college education, but don't expect them to think they need to chip in with paying the bill.
A majority of children believe their parents will cover all college costs for them, according to T. Rowe Price's 2016 Parents, Kids & MoneySurvey. And 62% think parents will foot the bill no matter which academic institution they decide to attend, according to the report, which surveyed 1,086 parents nationally as well as their 8- to 14-year-old kids.
Sadly, those kids are in for a shocking reality check. Only about a third of parents will actually be able to cover most or all college costs for their kids, T. Rowe's study found.
With the average cost of tuition and fees for the 2015–2016 school year $32,405 at private colleges, $23,893 for out-of-state students at public colleges, and $9,410 even for in-state students at public colleges, according to the College Board, many parents simply can't afford to provide the level of support their children expect or that they might want to give.
Parental Sacrifice
Most parents do say they intend to help out as much as possible, with 78% saying they'd delay retirement and another 68% saying they'd get a second job, the T. Rowe survey found.
In fact, parents with children currently attending college are already making big sacrifices to manage expenses. In a study conducted this year by Money and Barnes & Noble College, more than half of parents admitted to forgoing major purchases and vacations and cutting back on everyday spending, in order to free up funds to cover college costs. About 40% said they'd decreased retirement savings and delayed home improvements.
(Don't assume their kids were appreciative: More than a quarter of current college students told the Money survey that their parents didn't make any such sacrifices.)
Many families also told the Money/Barnes & Noble College study that they were taking out loans to cover tuition bills; 57% of the parents of college students (and half of the students themselves) said they were using student loans to pay for tuition, housing, food, books and other living expenses.
High Costs, Big Loans
The new T. Rowe study mirrored those results, finding that 57% of parents were willing to take on $25,000 or more in debt to finance their kids' college education. More startling, perhaps, a fifth of respondents said they were willing to borrow $100,000 or more.
Such a sum seems massive, but parents aren't just paying for tuition. In Money's survey, 91% of parents said they paid for their college student's cell phone bill, 70% paid for travel between home and school, 62% paid for school books and supplies, 60% paid for room and board, 49% paid for recreation costs, and 32% paid for extracurricular activities -- adding up to a total cost that half of parents said was more than they expected.
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The school also supports ordinary students as well, with more than one third from low-income families. FULL PROFILE Courtesy of UCLALike most large public schools, the University of Maryland has some all-star professors. The faculty roster boasts three Nobel laureates, two Pulitzer Prize winners and, thanks to the campus’s proximity to Washington, D.C., leaders in major positions at federal agencies like NASA and the National Institutes of Health. FULL PROFILE Courtesy of University of MarylandWhile Virginia Tech is known especially for engineering, its business, social sciences, and agriculture programs are also strong. The campus Math Emporium houses hundreds of computers programmed with lessons that have boosted students’ math prowess. FULL PROFILE Courtesy of Virginia PolytechnicUC–Davis has made a reputation as an affordable school that produces results. About 43% of students are low-income, but its six-year graduation rate is a high 83%. 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Like other colleges in the University of California system, the San Diego campus stands out for its comparative affordability for state residents. FULL PROFILE Courtesy of University of CalifoTexas A&M has one of the largest undergraduate student bodies in the country, with more the 40,000 students who graduate into an especially proud, loyal group of alumni. The college is well known for its business, agriculture, and engineering programs, as well as a recreation, park, and tourism management program. FULL PROFILE Courtesy of Texas A&MLike its fellow high-ranking Ivy League peers, Princeton and Harvard, Yale is highly selective. But for students who are admitted, the college promises a very generous financial aid package and courses taught by some of the world’s most extraordinary academics. FULL PROFILE Courtesy of Yale UniversityMIT is one of the best known and most respected science colleges in the world. 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FULL PROFILE Courtesy of University of VirginCooper Union is unique—a small, urban school that offers degrees only in art, architecture, and engineering. Though Cooper Union no longer has the free tuition policy it was founded with, it’s still much more affordable than other elite private colleges. FULL PROFILE Courtesy of Cooper UnionAn elite liberal arts college, Amherst is one of a small group of schools that will meet 100% of the demonstrated financial need of students. As a result, more than two-thirds of its students graduate without taking out loans. FULL PROFILE Courtesy of Amherst CollegeUC-Berkeley, or Cal for short, ranks the highest of eight University of California system schools that made Money’s rankings. In fact, Cal is one of the most selective public colleges in the country. More than 90% of freshmen graduate within six years, a rate well above even other elite public universities. 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All of that spending may help account for why 42% of parents told T.Rowe they "lose sleep worrying about college costs."
