T Rowe Price Survey Finds that Kids Expect Parents to Cover the Cost of Whatever College They Want

August 4, 2016 /3BL Media/ - T. Rowe Price’s 2016 Parents, Kids & Money Survey, which sampled 1,086 parents nationally and their 8 to 14 year old kids, found that many kids (62%) expect their parents to cover the cost of “whatever college I want to go to.” Yet most parents (65%) will only be able to contribute some to the cost of college. And the results suggest that student loans can lead to increased anxiety and financial stress. Parents with their own student loans are more likely to lose sleep over college costs (49% vs. 40%) and are significantly more likely to have credit card debt (67% vs. 54%) and payday loans (19% vs. 7%).

There are positive findings, however, as most parents are saving for their kids’ college (58%) and recognize the need to begin saving when their kids are young, with 68% saying under age 10, including 47% who say under age 5. And while some parents may not be using the most appropriate type of account to save for college, which include low-interest savings accounts (42%) and retirement accounts that penalize savers for withdrawing money before retirement (27%), a significant percentage of the parents who are saving are getting it right by using a tax-advantaged 529 plan (37%) to save for their kids’ college.

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