Your Child and College: Who’s Paying?

This week, a few quick questions about planning for college:

1: In your house, who helps your child(ren) with homework?
a) Me
b) My husband

2: Who helps your child(ren) research college choices?
a) Me
b) My husband

3: Who helps with the college application process?
a) Me
b) My husband

4: Who’s in charge of planning financially for college?
a) Me
b) My husband

According to a recent survey of more than 1,700 American parents from OppenheimerFunds, these answers are as follows. Question 1: you 83%, your husband 55%; Question 2: you 89%, your husband 62%; Question 3: you 87%, your husband 62% and Question 4: you 65%, your husband 85%.

In other words, we women are in there – fully participating, even leading the charge, at every step of the way – until it comes time to pay the bills.

Is this a problem? I’d say so. Because in many households, the financial end of this college planning process isn’t getting handled at all. According to the study, 62% of households have saved less than $10,000 for college, 43% have saved less than $5,000 and 12% have saved nothing at all. This isn’t a low-income problem. More than 40% of homes with incomes of more than $100,000 have saved less than $10,000 for college.

I’m not suggesting that men back out of their engagement. Or that families prioritize saving for college over saving for retirement. I’m a believer that retirement – where there’s no financial aid – trumps college – where there is. I am falling back on the old adage: When you want something done, ask a busy person. We women are the busy ones, but it’s time for us to engage.

Why? First of all, we believe more than men (74% vs. 69%) that it’s crucial for our kids to get college degrees. But second and perhaps more importantly, if the right kind of planning isn’t done, we are going to be the ones picking up the slack … and worse.

Think about it: We go about raising our kids, paying for what they need as they grow, as well as the other necessities of everyday life: the mortgages, car loans, here-and-there emergencies, health care. We shove as much as we can into our retirement accounts, knowing that it probably won’t be enough, and save a little for college on the side.

Then Harvard comes calling. Or maybe UMass. And so Junior doesn’t have to borrow all that much, we soft-pedal those 401(k) contributions and pay what we can out of cash flow. Life goes on. He graduates, as does his little sister. A decade later, we retire. We’re doing okay on our retirement stashes – living not lavishly, but comfortably. Ten years later, we’re still living, a little less lavishly. Your husband – sadly – passes away. And ten years from that, the nest egg is about gone. But you’re not. And you raise the white flag to ask the kids (who are now struggling to pay for college for their own kids, and fund their own retirements) for help.

Could the scenario be avoided? Maybe not in every case, but certainly in some. How? By getting in the game and acknowledging that you’re going to step up and pay for at least part of those college bills – parental guilt won’t allow you to do anything else – so you might as well build them into your financial plan. Doing so sooner rather than later will help us all.

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