As presidential candidates debate whether the federal government should pay for college costs, there are strong opinions on either side. States such as New York have already settled the question, and resident students of certain income levels can qualify for free tuition at community and state university colleges. No matter who wins the presidential election in 2020, the approval process for implementing change on a national level would probably take so long that it will be too late to help parents of current rising high school seniors.
The question for these parents is therefore pressing, and will probably need to be answered before the end of the calendar year. Of course you want to file the FAFSA as soon as possible after October 1 so your student can qualify for the maximum amount of financial aid. In this case, the federal and state governments help to cover part or all of the costs through various grant, loan and scholarship programs. Even after financial aid offers have been proffered by the desired colleges, though, it is most likely that there will still be a certain amount of money that will have to be paid by the family for college and associated expenses.
Some parents might have started a college savings plan when their child was born, or perhaps a grandparent has invested in a 529 savings plan, which will be a tremendous help, but difficult decisions will need to be made in most families. Parents must sit down with their children, discuss the reality of the family’s financial situation, and completely answer the financial responsibility question before sending the student off to college. Here are a few thoughts which can be taken into consideration during these discussions:
• Must parents pay for college? You might be surprised to find out that technically, no, parents are not legally required to pay for college. Once a child reaches the age of 18, he or she is considered an adult. This does not address the moral question of whether parents should pay for college, and divorced parents may indeed be required by the terms of their divorce settlement to contribute to college costs, but in most cases it is not a legal requirement. In some instances the child may already be considered independent for financial aid purposes.
• Should parents pay for college? If a student still lives at home and is considered to be dependent, then the parents’ income will be taken into consideration when financial aid is being granted by the various colleges. Wealthy parents might earn so much money that their student does not qualify for a substantial amount of financial aid, but it is only assumed that they will pay the costs, not required. Divorced or separated parents might also be surprised that some colleges will take the non-custodial parent’s income into consideration when computing financial aid. Most parents, however, feel that they do want to pay all or at least some of the college costs, depending on their own financial situation, to better prepare their child for the future job market. The amount they can afford may be affected by the size of their family, the need to support their parents, or saving for their own retirement. The amount of money the family will be able to contribute to the college costs should be clearly explained to the student so there are no surprises.
• Should students pay for college? Some parents, on the other hand, firmly believe that their children should learn about managing money by paying for their own college education. The thought process is that anything worth getting is worth working for. Although there are some students who do manage to work their way through college, most end up funding their education through student loans, which could have a negative financial impact on their own future.
Most families settle on some combination of taking money from savings, direct financial support, and having the student work or borrow the money. In any case the responsibilities and expectations should be clearly delineated so the student knows what to expect before even applying to college.