Today’s college students are feeling the burden of paying for their own education since only two-thirds of parents are saving for their children’s college education.
Four years of tuition at an in-state public college can cost as much as $50,000, and more than $110,000 at a private university. According to a recent poll in Next Step Magazine, 59 percent of parents who have tried to save money for their child’s education have saved less than $50,000. Only three percent of parents have saved between $50,000 and $150,000.
I have to pay half per year, and when I get out I have to pay them (my parents) back, Freshman Kevin Rauch said.
A 2005 survey by Vanguard and UPromise found that 64 percent of families with children under the age of 12 were saving for college. Only 37 percent of parents considered saving for their child’s college education a top financial concern.
According to a Sallie Mae survey, this is a big improvement. In 1997 only 18 percent of parents started saving for college before their child began school.
“Parents I know start saving when their child is in elementary school,” Freshman Beth Bell said.
Academic Management Services conducted a survey and found 57 percent of parents waited until their child was in high school before deciding how their college education would be paid for. However, 45 percent of children begin to show an interest in college before the age of 14.
“I already knew where I was going, so I tried to take classes in high school so I did not have to take them in college,” said Julie Viltrakis, who did not start thinking about college until her junior year of high school. “My parents pay for it all, she said, they always stressed education.”
There are several ways parents can begin saving money for their child’s college education, with savings accounts being the most popular form. Other forms consist of CDs, stocks, mutual funds, Uniform Gifts to Minors and Uniform Transfer to Minors accounts, savings bonds, Coverdell education savings accounts and 529 plans.