Despite rising college costs, fewer American families with children under age 18 save for college (50%) than did just two years ago (60%), according to a research report released today from Sallie Mae and Ipsos. While nearly all parents believe college is an investment in their child’s future, only one-third have a plan to pay for college. Many families not yet saving for college give non-monetary reasons that may be overcome with more financial education. As part of America Saves Week, Sallie Mae encourages families to start making saving for college a habit today.
“Households from all income groups are more likely to save successfully with a plan,” said Nancy Register, director of America Saves – a national social marketing campaign that encourages individuals and families to save money and build personal wealth. “As the cost of college continues to rise, America Saves Week, now through March 2, is a great opportunity for parents and their children to make a plan to save for college.”
“We are concerned that many families are putting off financial preparations for college,” said Sallie Mae President & COO Jack Remondi. “Saving even small amounts can add up over time, and every bit helps. Sallie Mae is committed to offering tools and resources to help.”
When asked to describe their feelings about saving for college, parents’ top answers were overwhelmed, annoyed, frustrated, scared, or that they don’t like thinking about it at all. Among those not saving, 47 percent cite a barrier other than money. Top reasons included thinking that children would be awarded enough financial aid to cover the cost of college, children are too young or too old, uncertainty about which savings option to use, procrastination, and feeling it is the child’s responsibility to pay for college.Starting to save is most frequently prompted by major milestones such as a child’s birth (34%), starting school (24%), or learning about college costs from friends and family (20%).