Fewer Parents Helped Pay for College in 2015
Posted By Terri Williams on November 30, 2015 at 12:31 pm
While parents continue to encourage, prod, request, and demand that their children attend college, it appears that fewer parents are actually putting their money where their mouth is. Whether it’s due to a lack of resources or other reasons, the number of parents contributing financially to their college student’s education has dropped from 81% in 2013 to 75% in 2015, according to the 2015 Discover Student Loans Survey.
More key findings from the parents surveyed include:
- 46% say their child should pay at least some of the cost
- 45% expect their child to pay all or most of the cost
- 54% say their child will take out a student loan
- 48% limit the choice of schools based on costs
The 2015 Discover Student Loans Survey also reveals that close to a quarter of parents say they can’t afford to pay for their kid’s education. At the same time, many parents have stipulations regarding their willingness to fund college. They don’t want to spend money on an education if they think their child either won’t find a job or won’t earn a good salary. The survey reveals:
- 44% are more likely to fund their child’s education if they choose a major with a high employment rate
- 47% say earning potential is more important to their child’s education than choice of major
While there may be several factors affecting these decisions and stipulations, GoodCall reached out to two experts and asked them to zero in on the most significant aspects.
David Levy is the editor at Edvisors and has 30 years of experience as Director of Financial Aid at some of the nation’s leading colleges, including Scripps College, California Institute of Technology, and Occidental College. “As a result of the last recession, parents are concerned about their own resources,” says Levy.
Unfortunately, many parents tend to think that their child will qualify for an academic scholarship, but Levy says less than 1% of students in a bachelor’s program will get a free ride. “Parents tend to overestimate their child’s eligibility for merit-based aid but underestimate their eligibility for need-based financial aid.”
April Masini, a relationship expert, author, and creator of the popular relationship advice site, AskApril.com, agrees. “The cost of college has skyrocketed, and the competition for scholarships and the spots at good state schools has become steep,” says Masini. She adds, “When parents are paying Ivy League prices for private schools that are nowhere near Ivy League standards, they’re not getting a good deal.” That may be one reason why more parents in the Discover survey said they were electing to send their kids to public universities instead of private institutions.
To some extent, parents may be directly or inadvertently forcing their kids to choose certain majors in exchange for financial assistance. Is this a good thing? Levy says that he’s hearing more parents say they’re not going to fund their child’s college education if the child declares certain majors because these parents know that different majors have different starting salaries.
However, Levy argues that a student’s possible major should not be the determining factor, especially, he says, since they may change their major over time. And he says colleges should not be picked based on cost. Levy warns, “Parents and students should look at the academic and social fit at a particular school. And they shouldn’t always pick the college that offers the most money – that package could include loan money, which increases a student’s debt.”
Masini questions the criterion used to determine if the major is a good choice. “Many parents feel that the return on their tuition should pencil out as salary for jobs their child receives after graduation. When it doesn’t, they feel that the school did a bad job or the education wasn’t worth the price paid for it.”
However, Masini says, “This is a tough way to calculate a return, and it creates an opening for schools to offer coursework that tends to allow graduates to more easily get jobs.” And, Masini explains, “This isn’t the way colleges began. Originally, colleges were intended as sources of education, and that was it.” She says the need to see a job at the end of the four years is a concept that developed in the past few decades. “Parents and students need to wrap their heads around the fact that college doesn’t guarantee jobs and it shouldn’t.”