Should Parents Pay for College? Opposing Viewpoints

With the cost of college rising by about 7% annually, the days when students could work a part-time job to cover all their college expenses may be gone for good. Still, for many families, the question remains: should parents pay for college? Does that expectation put an unfair burden on the parent? Or does it simply spread out the debt burden being unfairly placed on students?

Some parents would like to support their child’s college education but aren’t sure whether or not they can afford to chip in. Others might not be convinced that higher education is totally necessary, and therefore struggle to justify the astronomical cost. According to recent census data, 62% of Americans opt not to get a college degree — and say college affordability is the number-one reason. 

However, other data shows that higher education is usually worth the cost. According to a U.S. Bureau of Labor Statistics, the average employee with a bachelor’s degree makes $30,108 more per year than the average person with a high school diploma. Still not sure how that affects your personal situation? Read on to find out what solution might be right for your family.

How Americans pay for college 

Every family’s financial situation is different, and what makes sense for one might not make sense for another. That said, here are some averages to give you a sense of how much a college education can cost and what other families are doing to afford it. 

How much does college cost

Before you can decide who will pay for college, you should first estimate the total cost. According to EducationData, the average cost of college for American students is $36,436 per year. Of course, the price of your degree will vary upon what type of institution you choose to attend. For example, the average price for an in-state, public university is $9,678 per year. In contrast, a year at a private university costs around $55,840 on average.

With financial aid and scholarships, these prices can change. But the bottom line is this: most students, particularly those fresh out of high school, don’t have enough money to afford higher education on their own. 

What are different ways to pay for college?

As the cost of education continues to rise, families must increasingly cobble together multiple sources of funding to cover the bill. The most common options include:

  • Financial aid from the federal or state government 
  • Financial aid from your college or university
  • Scholarships
  • Work study 
  • Parental or familial support
  • Part-time jobs
  • Private student loans 

How does the average American family afford college?

The average American family income is $74,580, according to recent census data. Sallie Mae, a consumer banking company that has its roots in the U.S. government, estimates that families spent an average of ​​$25,000 on annual tuition during the 2021/2022 school year (note: this is the total out-of-pocket cost after financial aid).

Here’s how those families covered the tuition bills:

  • 54% of the money came from income and savings
  • 26% came from scholarships and grants
  • 18% of tuition was covered by loans
  • 2% was paid by relatives and friends. 

While scholarships and loans made up a significant portion of most families’ payment strategies, a full 87% of families used some of their own income or savings to pay for college. This means that only 13% of students were able to cover the entire cost of their educational expenses without the benefit of parental income or savings. 

How much debt does the average family take on — and for how long? 

Student loans are an important source of funding for college tuition. According to the Sallie Mae study, about 41% of American families took out loans of some kind to help cover tuition costs. The vast majority of those were federal student loans.

According to reporting from Forbes, families who decide to take out loans end up in about $28,950 in debt on average. Most student loans, including federal student loans, come with a 10-year term. So, if you’re able to keep making your payments consistently, you’ll be out of debt within 10 years. That said, life happens, and it’s hard to tell what your financial situation will look like several years down the line. In practice, it takes the average person approximately 20 years to completely pay off their student loans. 

Deciding to take on debt is a huge decision and one that no student or family should take lightly. Before you decide to take out student loans, do your research on the different types of loans available to you and what their actual cost may be. 

Yes, parents should pay for college 

Many people believe that parents — as long as they’re earning steady income and can afford to chip in — should provide financial support for their children’s college education. Here are a handful of reasons why parents might want to help out:

  • Degree completion: For many students, the ability to focus on schoolwork and not worry about maintaining a part-time job can allow them to maintain full-time status and complete their degree faster. If your child completes their degree in four years rather than five or more, the total cost of the degree will likely be much lower. 
  • Higher GPA: If, by not working, a student is able to focus solely on their academics, they may be able to substantially increase their GPA. This can improve their professional prospects after college.
  • Development opportunities: The freedom to simply be a college student may allow your child to explore other areas of intellectual interest and enjoy everything the college experience has to offer. This can include developing socially, meeting new people, discovering hobbies, and learning how to become a confident, independent individual. 
  • Debt-free future: Those who graduate without student debt start their adult lives with a financial leg-up. If your family can afford it, this head start could help your child pursue the career of their dreams without having to worry about making enough to cover student loan payments right away.

How to decide if you can afford it

If you want to help pay for your child’s higher education, your next step is to truly consider whether or not it makes sense for your financial situation. To do that, ask yourself these four questions:

  1. Do you have other debt? If you already have a mortgage, a car payment, or credit card debt, do some math to figure out how much additional debt you can comfortably take on.
  2. Do you have an emergency fund? It’s smart to have some type of financial safety net, and most financial experts counsel against dipping into this fund to cover college costs. Before you take on new debt or take money out of savings, make sure you have enough money in reserve to cover your living expenses — including any existing debt payments — for at least three to six months.
  3. Can you afford loan payments? If you’re already struggling to pay your bills or barely have enough to save for retirement, you may not be able to afford another monthly expense. According to reporting from Forbes, the average monthly loan payment is currently between $200 and $299. (You can also get check out the loan payments calculator halfway down this page.) If you don’t have a budget already, write out your current monthly expenses and see how this type of payment might fit into your financial planning.
  4. How will this affect your ability to retire? Saving for your future is important. If paying for your child’s college comes at the expense of your retirement savings plans (or means draining your retirement fund), you should consider your options carefully. 

No, parents shouldn’t pay for college 

Many parents feel that the financial burden of higher education shouldn’t rest on their shoulders. Here are a few reasons some parents opt not to help their children pay for college:

  • It can teach responsibility: Deciding to pursue a college degree is a privilege that comes with great responsibility. Requiring your child to pay their own college tuition could help them develop personal responsibility and understand the impact of their decision making. Allowing a student to cover their own college expenses can also help them understand personal finance and learn the value of a dollar.
  • It may instill focus: If a student is paying their own college expenses, they might take greater care to study harder and stay away from various distractions. One study, published in 2013, found that students whose parents paid for college had higher graduation rates, but that their GPAs were lower than those of students who paid some or most of their tuition. For some college students, being forced to pay their own way might help them take their studies more seriously.
  • You’ll be able to save more for retirement: If your financial situation doesn’t allow you to both pay for your child’s education and save for your own future, don’t feel guilty. While there are many different types of loans available for students, there aren’t loans for retirees. If you’re forced to choose between your student’s tuition bill and your retirement savings, consider prioritizing your retirement. 

The middle ground

So, should parents pay for college? The answer isn’t necessarily “yes” or “no” –– it could be somewhere in the middle. You may not feel like you should be expected to cover all the expenses associated with your kid’s college, but the hard truth is that college tuition costs much more today than it used to. As a result, it’s more difficult for students to work their way through school than it was in the past. 

So, as long as helping to cover your child’s college education doesn’t come at the cost of your own financial goals and retirement savings, it may be prudent to help your child offset at least some of the costs. Agreeing to cover half of the tuition bill, or even just chipping in for room and board can make a big difference to your child’s in-school stress levels and financial future.

If you want help with this, make a copy of this budget guide, to discuss with your child who pays for what.

Start with the FAFSA®

Filling out the Free Application for Federal Student Aid (FAFSA®) should be the first thing on your family’s college to-do list. The FAFSA® helps prospective college students determine their eligibility for federal financial aid. This year, the application becomes available in December 2023, and students should aim to fill it out as soon as possible, because some financial aid is first come, first served.

Data from the FAFSA® can tell you how much your expected family contribution (EFC) should be, the amount of federal and state financial aid you can expect to receive, and what your out-of-pocket cost for certain types of schools will be. Completing the FAFSA®  is the best way to secure financial aid, save money, and lower the cost of your college tuition. 

During this step of the process, try Going Merry’s FAFSA® Made Easier service. It’s entirely free, and it takes a lot of the guesswork out of completing the FAFSA®. We’ll take you through the application step-by-step, explaining any confusing financial lingo along the way. We’ll also help you catch potential mistakes that could cost you financial support.

Help your student find scholarships and grants 

After using the FAFSA® to determine how much federal financial aid you can expect to receive, it’s time to look at scholarships and grants. In the 2020-2021 school year, 73% of American families used some type of scholarship or grant to help cover their kid’s college . 

As you begin your scholarship research, remember that there are types of awards for every kind of student. Don’t be discouraged if your child isn’t a stellar student or an amazing athlete — chances are, there’s still a scholarship for them

As you help your child identify awards, it’s smart to think about the things that make them different. With the Going Merry scholarship search platform, you can sort scholarships by expected major, extracurricular interests, or personal background. Going Merry will then use those details to match your student to scholarships they’re eligible for.

Going Merry also lists government grants, so you can easily see which state/federal governments you might be eligible for, and where/how to apply for them.

Consider your options before taking out loans

If, like many American families, you can’t afford the entire cost of college, be sure to explore alternative funding options before taking out student loans. 

College savings plans

If college is still a few years out, consider getting on a college savings plan. The U.S. department of education offers the popular 529 Plan, which is a savings account that allows families to contribute tax-free. If you put even just $10 a week into a 529 Plan at the beginning of high school, you’ll have several thousand dollars saved by the time your student is ready to go off to college. 

Community college

If you want to attend a private college or an out-of-state university, consider spending a year or two at community college first. This can help you save money while you complete your general education requirements, which are fairly similar from school to school. When those are done, you can transfer to the college or university of your choice and finish your degree there. You’ll still get a diploma from that institution — just at a fraction of the cost.  

Reserve Officers’ Training Corps

Another good way to save on college tuition is to join a Reserve Officers’ Training Corps (ROTC) program or to attend a military-affiliated college. These types of military-sponsored programs can cover up to 100% of a student’s education expenses in exchange for military service upon graduation. These programs generally cover all tuition and fees and provide stipends for living expenses and other costs, like books and supplies. 

Explore federal loans first 

If you’ve maxed out your scholarship potential and alternative funding options, your next stop should be federal loans. There are three different types of federal student loans — Direct Subsidized, Direct Unsubsidized, and PLUS loans. If you’re the parent of a student, you’re eligible for Parent PLUS loans. (Otherwise, as a graduate student, you’re eligible for Direct PLUS loans.)

Direct federal loans are more favorable than private loans for a variety of reasons, including:

  • Accessibility: Unlike private loans, federal loans don’t typically require a minimum credit score or a co-signer. (Direct PLUS loans do require parents to share their credit information, but there’s no minimum score required.) 
  • Lower, fixed interest rates: Federal loans tend to carry lower interest rates than private loans. And unlike private loans, federal loans always have fixed interest rates. This means your interest rate cannot increase over time. Instead, you’ll be locked into the same monthly payment amount no matter what happens to the national economy. 
  • Flexible repayment: The government provides various repayment options to help you repay your loans. If your financial situation changes or you have trouble affording your payments, you can apply to have them capped at a certain percentage of your income.  
  • Deferment and forbearance: The U.S. Department of Education also allows you to put your payments on pause during periods of economic hardship. These protections — called deferment and forbearance — aren’t usually offered by private lenders. 
  • Student loan forgiveness: One of the greatest attributes of federal student loans is that they can be forgiven. One of the most famous loan forgiveness programs is Public Service Loan Forgiveness (PSLF). This program is available to graduates who have made 120 consecutive payments on their loans while working for a government or non-profit organization. There are several other forgiveness and cancellation options in addition to PSLF. (Parent PLUS loans can be forgiven, too, but generally only in specific circumstances.)

Note that Parent PLUS loans do not carry lower interest rates (they are designed to be more “at-market” rates, similar to private student loans) and are made out in the parent’s name rather than the student’s, but they carry all the other federal benefits.

Plus, with Parent PLUS loans, you aren’t capped at a specific loan amount; parents can borrow up to their child’s total cost of attendance. That’s great if you can afford it, but it does make it easy to bite off more than you can chew. If you find yourself unable to make your loan payments, you could face serious consequences.  

Consider private loans

If you and your child have maxed out your Direct federal loans and are still coming up short, it might be time to explore private loans1. Private loans are offered by private institutions, like banks, credit unions, and online lenders. Especially if you have good/excellent credit, you may find more favorable interest rates with private loans vs. Parent PLUS ones. You can often check your rate (without impacting your credit), for example here with our loan partner Earnest).

Note that most private lenders require parents to be involved. You can get a parent-only loan (like the federal Parent PLUS) or act as a co-signer for your child, the student borrower. If you cosign the loan (i.e., put your name on the loan alongside the student), you’ll be on the hook for the cost of the loan should the student fail to pay. If you’re uncomfortable with this or unable to cosign due to your financial situation, you might want to explore other educational options, like a less-expensive or in-state school. 

Private loans can provide a lot of financial support, but they also come with some drawbacks:

  • More varied (often higher) interest rates: Private loans are generally more expensive than Direct loans, and sometimes more expensive than Parent PLUS ones. Some lenders will also only offer “variable” (not fixed) rate loans, which means they can change during the life of the loan, based on how the overall economy performs. Also keep in mind that some private lenders advertise extremely low rates that aren’t actually accessible to the average borrower. Before you take out a private loan, do your research, compare loan types, and make sure you’re choosing a reputable lender with a good rate. (For instance, you can get a personalized rate estimate here with our partner Earnest, which gets 4.7 stars on Trustpilot.)
  • More rigid repayment schedules: Private lenders are rarely as generous as the federal government when it comes to repayment terms. And they’re not required by law to allow borrowers to pause payments during periods of hardship. Private lenders also don’t have income-based repayment plans like the federal government does. 
  • Payment schedule: Federal student loans don’t require parents or students to make payments until after the student has graduated. Some private loans require repayment to begin immediately, though others allow you to defer payment (and particularly good lenders – like Earnest – offer students a nine-month grace period2 after graduating to find a job and get their footing before repayments begin).
  • Fewer forgiveness options: The majority of private student loans cannot be forgiven under any circumstance. Unlike federal loans, which allow contingencies for federal workers or teachers, private lenders require repayment no matter your career or financial situation.

Get matched to scholarships with Going Merry

If your child is graduating from high school and hoping to pursue a higher education, you might feel a mixture of emotions, like pride, joy, excitement — and even anxiety. It’s no small feat to raise a studious and responsible child who prioritizes their education. But determining how to support their future academic plans amid the ever-rising cost of college can be challenging no matter your tax bracket. 

Fortunately, there are many options to help lower your student’s tuition bills, from applying for financial aid to winning scholarships to taking out federal student loans. If you plan to split the financial burden with your child — or take it on yourself — be sure to fill out the FAFSA®, explore loan options, and pursue scholarships.

To help with your scholarship search, consider signing up for Going Merry. Your child can build a profile, populate it with their interests, and get matched with scholarships that fit their eligibility qualifications. You can also sign up for Going Merry’s parent newsletter to get timely advice on finding scholarships, helping your child apply for college, and hitting all the right deadlines. 

At Going Merry, we’re in the business of helping you — and your children — afford that degree with minimal stress. Sign up today to streamline your college funding search. 

Disclaimer: This blog post provides personal finance educational information, and it is not intended to provide legal, financial, or tax advice.

1 Before applying for private student loans, it’s best to maximize your other sources of financial aid first.  It’s recommended to use a 3-step approach to assembling the funds you need: 1) Look for funds you don’t have to pay back, like scholarships, grant, and work-study opportunities.  2) Next, fill out a FAFSA(R) form to apply for federal student loans.  Federal Direct subsidized and unsubsidized loans, excluding PLUS Loan for Parents and PLUS Loan for Graduate and Professional Students which require a credit check and a credit worthy endorser if the parent or graduate or professional student has adverse credit, do not require a credit check or cosigner, and offer various protections if your struggling with your payments.  3) Finally, consider a private student loan to cover any difference between your total cost of attendance and the amount not covered in steps 1 and 2.  For more information, visit the Department of Education website at

2 Nine-month grace period is not available for borrowers who choose our Principal and Interest Repayment plan while in school.

Earnest Private Student Loans are made by One American Bank, Member FDIC, or FinWise Bank, Member FDIC. One American Bank, 515 S. Minnesota Ave, Sioux Falls, SD 57104. Finwise Bank, 756 East Winchester, Suite 100, Murray, UT 84107.

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