Our country’s poor economic state is affecting all families differently. Cutting back on costs is happening across the board, however. When you’re looking where to cut down on your budget to get your family through the recession, your responsibility to pay for your child’s college tuition may come into question. Here are some ideas to keep in mind when deciding how much you’ll contribute to your child’s college tuition.
Most financial experts agree that putting aside money for college tuition should come later in your list of financial priorities. Once you’re debt free and have at least some money saved for your own retirement and have extra money each month, you should start investing it for your child’s education. It’s advised that you start saving as early as possible so the invested money can earn as much as possible through annual interest. If you contribute $5,000 a year, for example, from the time your child is ten years old until she’s 18, you’d earn about $15,000 in interest throughout the eight years. If you start saving early on, you may be able to cover your child’s entire education. Or you can opt to offer her some of that money and put the rest toward retirement.
If you already have a sum saved for that purpose, there’s no reason to take that away. You’re helping your child start her adult life. Having any amount of money for her education will remove a huge weight off her shoulders. That doesn’t mean that you must foot the whole college bill, though. Once you have a chunk of money saved for her, you can let her know the rest is up to her to fund. If she chooses a college where the money you saved would be enough to cover at least tuition and maybe part of her basic living costs, then great. If she chooses to go to a private school, out of state, or to a more expensive school, then she’ll know it’s up to her to make up the rest of the costs.
Though it shouldn’t be a major factor when deciding how much to contribute to a college fund the more you contribute, the more say you can have in her school and degree choices. If you’d like to have some leverage in her decisions throughout college, then you may need to help her pay for it to keep that leverage.
You know your child better than anyone so you should follow your instincts on how much to help her with her college costs. If you’re unsure she could make it without any help, then help her and vice versa if she’s the independent type. You’ll know whether she’ll seek your counsel on whether to enter one of those conflict resolution degree programs or pursue a business degree program no matter if you pay or not.
College is when we all start learning to be an adult and learning to pay for school could really benefit some students. Having to pay for her own education costs will help your child stay focused and understand the importance of an education in our society but any amount you can contribute to the fund will help her out and reduce her stress.