As parents, we want what’s best for our children, and that includes ensuring they have a bright future. One of the most effective ways to support their future is by helping them avoid the burden of student loan debt. While saving for college may seem daunting, it’s something every parent should consider, especially those who have the financial means to do so. In this post, I’ll share why you should stop making excuses and start saving for your child’s education, even if you think it’s not your responsibility.
The Reality of College Costs
During a recent trip to Hawaii, I found myself in a conversation that still irritates me. I sat near a man who explained that he didn’t want to pay for his children’s college education. While many people may struggle with this, this individual had the means to save but chose not to. His reasoning? He believed paying for college would teach his children entitlement, and he didn’t think it was his responsibility to help them financially.
This mindset really rubs me the wrong way. It’s one thing to not be able to save due to financial constraints, but when you have the ability to save and choose not to, it feels irresponsible. College costs are only increasing, and student loan debt is a growing crisis in the U.S. The average student loan debt for graduates in 2017 was around $39,400, a number that only seems to rise year after year.
If you’re a parent who can afford to save, there’s no excuse not to. Here’s why you should be proactive about saving for your children’s education and stop procrastinating.
1. You Don’t Have to Pay for All of It
One common misconception about saving for college is that you either have to cover the full cost or not contribute at all. This is not true. Even if you can only pay for part of your child’s education, every bit helps. You can aim to pay for a portion of their tuition or just their first year, depending on your financial situation. The important thing is to start saving something, even if it’s a small amount. As time goes on, your savings will grow, and your child will be better off for it.
When I started saving for my children’s education, I didn’t know where they’d go to school or how much it would cost. All I knew was that I could contribute X amount per month. That small effort has already made a difference, and in ten years, I know I’ll be glad I did.
2. Every Dollar You Save Counts
No matter how small the contribution, every bit of savings will help your child avoid taking out as many loans. When I first began saving, I only had enough to put away $25 a month per child. It seemed like a small amount, but over time, thanks to compound interest, that money grew. Now that I can save more, I’m seeing even more growth.
Let’s say you manage to save $10,000 for your child by the time they’re ready for college. That’s $10,000 they won’t have to borrow, which means they won’t pay interest on that money for years to come. Even small amounts add up, so don’t let excuses hold you back from saving what you can.
3. Your Income May Affect Financial Aid
If you’re moderately wealthy, it’s likely your child won’t qualify for much financial aid, especially if proposals for free college for families earning under a certain amount become law. While there’s no telling exactly what the future holds, it’s possible that a large portion of your child’s classmates will be able to attend college for little to no cost, while your child may not receive the same benefit.
If you have the means to save for college, it’s in your child’s best interest to do so. Not only will they have a head start, but they won’t be left scrambling for aid while their friends benefit from government support.
4. Teaching Responsibility Doesn’t Mean Burdening Them with Debt
Some parents believe that the only way to teach responsibility is to make their children pay for their own education through student loans. This couldn’t be further from the truth. There are many ways to teach your kids responsibility, from having them do chores to taking on part-time jobs.
Saving for college doesn’t mean your child will get a free pass. You can still encourage them to take responsibility for their own future. If they take out loans, you can use the money you saved to help pay them off if they meet certain conditions, like maintaining a good GPA.
5. Take Advantage of Tax Benefits
In many states, saving for college comes with tax benefits. For example, in my home state of Indiana, we get a 20% tax credit on the first $5,000 we save each year for college. That’s $1,000 in tax savings that I can put back into my child’s education. Check with your state to see if you can benefit from similar tax advantages. If you’re in a state that offers these benefits, there’s no reason not to take advantage of them.
The Bottom Line
It’s never too early to start saving for your child’s education. While it’s understandable that not every family can afford to contribute to college savings, if you are in a position to do so, don’t let excuses stand in your way. Starting your child’s adult life with tens of thousands in student debt is not the best way to teach responsibility. Instead, help them avoid the stress of loans and set them up for a brighter future by saving for their education.
So, if you’re a parent who can afford it, start saving today. Your child’s future self will thank you.
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