Parents are wising up when it comes to taking on debt to pay for their children’s college education. According to a survey by T Rowe Price, parents are less willing to take on more than $75,000 in Student loan debt towards their children’s education this year.
At the same time, more parents are willing to take on college debt that is less than $25,000 – a much more manageable figure. Those changing attitudes come alongside other good news for parents: They are losing less sleep over college costs.
The survey found that only 14 percent of parents are willing to take out more than $75,000 in debt to pay for their children’s college this year. That is down from 26 percent of parents who were willing to do that in 2017 and 28 percent in 2016.
At the same time, fewer parents reported they are losing sleep this year over college costs. Twenty-seven percent of parents said they have lost shut eye, versus 41 percent in 2017 and 42 percent in 2016.
Parents are also getting wiser when it comes to how to manage the costs of college. More individuals reported that they are willing to send their kids to a less expensive school in order to reduce debts. Also, more parents are using 529 college savings accounts to put away money toward tuition costs. The accounts became the most popular way to save for college this year, versus 2017 and 2016 when regular savings accounts were the most popular way to save.
The survey, which was conducted in January, included 1,013 parents and 1,000 young adults ages 18 to 24.
What Makes Me Different From the Others?