70% of Parents with College-Bound Children Are Worried About Having Enough Money to Pay for College
07 Giugno 2023 - 2:00PM
Business Wire
One-third of parents said they are in a worse
financial position to help pay for college versus last year
A national survey from Discover® Student Loans revealed that a
majority of parents with college-bound children are worried about
having enough money to pay for their child’s education.
According to survey findings, more parents feel financially
unprepared to pay for college this year than in previous years with
nearly three-quarters (70%) worried about having enough funds,
compared to 66% last year and 63% in 2021. While there are multiple
contributing factors to the feelings of financial worry, parents
indicated a few key reasons, including inflation straining savings
and spending (48%); not starting to save early enough (46%); and
rising tuition costs (43%).
Overall, more than one-third (36%) of parents said they are in a
worse financial position to help pay for college versus last year.
And the financial worries extend beyond parents’ bank accounts. For
many of these families, children’s college decisions are also
ultimately affected:
How have your child's school choices
changed now that you are in a worse financial position?
My child now must look into
scholarship/financial aid options
34%
My child is now only able to look at
schools with in-state tuition
27%
My child is now only able to look at
schools that allow a daily commute from home
16%
The value of college – inflation and tuition costs are
creating uncertainty
While many parents feel that college is necessary to find a good
job (73%), nearly half of parents (46%) are questioning whether
college is still a good investment. With rising inflation and
tuition costs, 68% of parents surveyed are nervous about the amount
of debt their children will take on compared to their post-college
career earnings.
“As college costs continue to rise, students and their families
need to make sure the school and program their child selects will
lead to a meaningful job in their chosen field with a healthy
salary,” said Rich Finn, vice president of Discover Student Loans.
“Families should aim to have conversations early and often about
college costs and job and salary prospects after graduation.
Parents and students look to scholarships and loans as
college costs rise
Overall, fewer parents are able to cover the full cost of
college compared to last year. Less than one-third (27%) of parents
say they will help pay for all of their child’s education, down
from 39% in 2022. As such, more families are turning to other ways
to ease the cost of college, like scholarships. In fact, 61% of
respondents said they will use scholarships and grants to help pay
for their child’s education, up 7 points from 2022 and up 14 points
from 2021.
In addition to scholarships, more families are considering
student loans to cover college costs. This year, nearly half (45%)
of surveyed parents said they will use student loans to pay for
their children’s education, up 4 points and 18 points from 2022 and
2021, respectively. Of parents who said they will use loans to help
pay for college, 55% indicated they plan on using a combination of
federal and private student loans; 42% selected federal student
loans only.
“We want families to feel as prepared as possible to pay for
college,” said Finn. “To support families, Discover Student Loans
offers a scholarship search tool on our website that provides free
access to over three million scholarships. If families need a
private student loan, we also have a free student loan calculator
to help them estimate how much they need to borrow and what their
monthly payments would look like.”
About the Survey
All figures, unless otherwise stated, are from a Dynata
(formerly Research Now/SSI) survey conducted on behalf of Discover
Financial Services. The survey was conducted online and fielded by
Dynata with a total sample size of 1,000 parents of children ages
16-18 who plan on attending college or trade school. The margin of
sampling error was 3 percentage points with a +/-5 percent level of
confidence.
About Discover
Discover Financial Services (NYSE: DFS) is a digital banking and
payment services company with one of the most recognized brands in
U.S. financial services. Since its inception in 1986, the company
has become one of the largest card issuers in the United States.
The company issues the Discover® card, America's cash rewards
pioneer, and offers private student loans, personal loans, home
loans, checking and savings accounts and certificates of deposit
through its banking business. It operates the Discover Global
Network® comprised of Discover Network, with millions of merchants
and cash access locations; PULSE®, one of the nation's leading
ATM/debit networks; and Diners Club International®, a global
payments network with acceptance around the world. For more
information, visit www.discover.com/company.
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Sheetal Shah Discover sheetalshah@discover.com 224-405-0297
@Discover_News
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