As the school year ends, I am reminded that my children are another year closer to college. I still remember paying off my own $30,000 in student loan debt, and now I am worried about saving up for their tuition. While I still maintain that parents should secure their own retirement needs before worrying about their kid’s college bill, what if you are doing okay and want to help out?
Priceonomics and student loan marketplace LendEDU did a survey of over 1,400 college graduates between the ages of 25 and 54. They found on average, people graduated college initially with roughly $40,000 in student loan debt and currently still maintain a balance of roughly $30,000.
Of these college graduates, how many people receive financial help from their parents? How much assistance did they get? Here are the results.
The survey also asked questions about gender, race, and the extent to which debt hindered their ability to cover daily expenses, save for retirement, or start a small business. The article focused on the differences, but overall I saw more similarities than differences. In all the cases, between 50% and 71% of people felt that their student loan debt hindered them in all three scenarios.
There are many (terrifying) projections about how much college will cost in 2035. I’ve seen numbers over $100,000 per year for private tuition/housing and $50,000 per year for public tuition/housing in today’s dollars. However, according to this survey only 9% of parents paid for most and 11% paid for half of their kid’s tuition. 80% of parents either paid nothing or “a little”. It’s hard to reconcile these two stats. Are students in 2035 really going to graduate with $100,000 of debt? Something is going to have to give.