College is a scary thought, not only for students, but for their parents as well. As tuition continues to skyrocket, many families are adjusting their budgets and finding that they are not as prepared as they thought.
In the past five years college cost preparedness has decreased from 24% to 16% according to a study conducted by Fidelity Investments. The study took data from an online survey of more that 2,300 parents nationwide with college-bound children of all ages.
The study threw out some interesting percentages, and although it did show an 8% decrease in monetary preparedness, there has been a 9% increase in parents that begin saving for college. This discrepancy can most likely be explained by rising tuition costs. More families may be saving, but as tuition hikes continue, less families are able to pay.
Strategy 2007 2011
Worried about burdening children with college loans. 65% 75%
Have child work part-time. 49% 59%
Have a child live at home and commute. 38% 48%
Ask child to help pay for college. 36% 46%
Encourage child to attend public college or university. 34% 44%
Asks child to graduate in fewer semesters. 13% 49%
Have non-working spouse go back to work. 11% 18%
Parent gets a second job. 11% 17%
B Average or Else…
The survey also found that two-thirds of parents use tuition as a motivator to get a 3.1 GPA or higher. Sixty six percent of parents believe this is a good way to get their children to focus on grades while also keeping college expenses in mind. There are two sides to this method.
One, shows children that a college education is a big expense that deserves to be earned. While the second, may actually harm the child’s chances of excelling in an academic setting. Maybe if a child is struggling in school taking away financial support may not be the most effective method to get them into an educational environment that meet their needs.
Although every family deals with budgeting differently, there are plenty of other options to help save. From buying used books to opening savings accounts, check out these options to help make smart money decisions to help fund college: