Given the constant rise in college costs, paying for college is an overwhelming expense for most families. In fact, a recent report by Sallie Mae shows that families spent an average of $28,026 on college tuition and fees in the academic year 2022–23.

These steep higher education prices raise an important question—should parents pay for college, or is there an alternative? In this detailed guide, you’ll learn all about the pros and cons of parents paying for college and find various methods for covering your child’s university costs most effectively.

Are Parents Obligated To Pay for College?

Although covering your child’s college tuition is a great help, parents generally aren’t legally obligated to pay for their children’s college education. However, divorced parents can be an exception to this rule if their divorce agreement states that they have to pay for college.

While paying for college isn’t a legal requirement for parents, many feel a moral responsibility to help their children cover higher education costs. For this reason, many parents opt to pay for college or at least partially contribute to the costs, especially if their children don’t have any income of their own.

How Much Does College Cost?

The average college cost, including books, supplies, and daily living expenses, adds up to $36,436 per student per year. Still, the full price depends on the type of college your child chooses to attend and its location—whether it’s an in-state or out-of-state institution. In-state colleges are a more affordable option since the states fund their public schools, which lowers the tuition rates.

Private institutions tend to be more expensive, while community colleges are among the cheaper options. Here’s a breakdown of annual tuition costs depending on the type of institution:

Institution Type	Tuition Cost
Two-year, in-state public	$3,501
Four-year, in-state public	$9,678
Two-year, for-profit private	$15,637
Two-year, non-profit private	$17,735
Four-year, for-profit private	$17,825
Four-year, non-profit private	$38,768

How Much Should Parents Pay for College?

With such high college tuition prices, it’s no surprise that hardly any student can afford to pay for college completely on their own. In fact, Sallie Mae’s report for 2023 shows that only 11% of university costs were covered by student borrowing, and 10% was paid with students’ income and savings. In the same year, 40% of college costs were covered by parents’ income and savings.

So, how much should parents pay for college exactly? There’s no definitive answer. For example, if your child has a scholarship that covers most of their college tuition, you can pay for their books and supplies. However, the percentage you want to dedicate to your child’s higher education ultimately depends on your income, family values, and the level of financial support you feel your child needs.

To see if you can afford to pay for your child’s college, assess your financial situation. Consider questions like:

• Have you saved enough for retirement, or are you on the track of saving enough?
• Do you have enough saved for emergencies?
• Can you afford a loan payment?
• Do you have other debt?

If you’re not in debt, and the answer to the other questions is “yes,” you should be able to pay for your child’s college.

Pros and Cons of Parents Paying for College

Since most parents financially support their children throughout primary and secondary education, many aren’t sure whether this should change once their child starts college. If you’re among these parents, take a look at some pros and cons of parents paying for college to come closer to the answer.

Why Parents Should Pay for College

Many parents of college students believe that they should pay for college as long as they can afford it. There are several reasons why you may benefit from this approach:

• Your child can get a degree in a timely manner—With no financial burden, your child can focus on schoolwork and complete their degree faster. This can prove to be a less expensive option in the long run since they’d get a degree in four years rather than five or six
• They may get better learning opportunities—If your child doesn’t have to work part-time and worry about paying for college, they can completely focus on academics and pursue activities like community service or joining on-campus organizations. These opportunities are great for meeting new people and making connections. They’d also have more free time and gain independence in organizing their college life
• They can graduate debt-free—Graduating without the burden of college debt allows your child to find a job they like without worrying about whether their initial salary will be enough to cover their loan payments. This also makes it easier for them to focus on achieving their financial goals and invest in obtaining housing

Why Parents Shouldn’t Pay for College

A lot of parents believe their children should be responsible for paying for their own higher education. The main benefits of not paying for your child’s college include the following:

• Your child will learn to be responsible—Having to pay for college may help your child gain a better understanding of personal finances and the value of money. They may also learn to make more responsible decisions as they have to decide which college they can afford and how they plan to pay for it
• They’ll truly understand the value of education—If your child pays for college using their own money, they’ll be less likely to let their grades slip as they’ll view education as a responsibility. If you pay for their college, they may take education for granted since they won’t be the ones investing in it
• You’ll be able to save more for retirement—While there are numerous student loans available, there are no retirement loans you can rely on later on. Without any college loans to worry about, you can save up more for retirement

Why Parents and Students Should Split College Costs

While there are specific advantages to both parents paying for college and students covering the college cost, there’s an alternative that combines the benefits of both options. You can agree to split the cost—for example, your child can cover room and board while you pay for tuition. The main advantages of this approach include the following:

• Your child will strike a balance between freedom and responsibility—Not having to pay for college entirely on their own can help your child focus on studying and becoming independent. However, since they’ll still be covering a part of the college cost, they’ll also learn how to be responsible with money
• They’ll have less debt—While your child may have to obtain a loan to cover their portion of the costs, their debt burden will be lessened because you’ll be paying for part of the cost
• You and your child will stay connected—Your child leaving home for college may negatively impact your family’s relationship dynamics, but sharing college costs with them can serve as a unique bonding experience while they’re away

How To Pay for College—The Most Common Options

Paying for college requires a lot of research and planning because families rarely have such a large sum of money readily available. In most cases, parents use multiple financial resources to lighten the burden. The most frequent methods to pay for college include:

1. Savings funds
2. Scholarships and grants
3. Federal loans
4. Private loans

Savings Funds

If you opt for a college savings fund, the earlier you start one, the better. Some parents start saving the moment their child is born, but even if you start when your child is a few years away from graduating high school, you can still have a substantial amount saved by the time college starts.

There are numerous college savings accounts, but the most popular option among American parents is the 529 plan. The contributions you make to this savings account are tax-free, and the plans are low-risk, meaning your chances of getting a return on your investments are high. For example, putting away as little as $10 a week once your child starts high school can help you save several thousand dollars by the time they go to college.

Scholarships and Grants

A great way to lower your child’s college expenses is to help them research and apply for scholarships and grants while they’re preparing for college. There are numerous options based on their academic success, sports achievements, or extracurriculars, so there’s a high chance your child can find the right scholarship to apply for. There’s no limit to the number of scholarships they can apply for, and they don’t have to pay back the money they receive if they’re approved.

Federal Loans

Once you’ve exhausted your savings fund resources, you may consider federal student loans—money you and your child can borrow from the federal government and repay with interest. You can explore federal loans like Direct PLUS loans, which offer two options:

1. Parent PLUS—A Direct PLUS federal loan made to eligible parent borrowers
2. Grad PLUS—A Direct PLUS federal loan made to professional or graduate students

Like getting free federal student aid, the first step to obtaining a federal loan is helping your child apply for Free Application for Federal Student Aid (FAFSA). This will involve filling out your income information and reporting any assets you have to paint a realistic picture of your family’s finances.

Make sure you start the application process as soon as it becomes available (applications for 2024 started in December 2023). While the FAFSA is a great option because it doesn’t have strict eligibility requirements, your child may not get federal aid if they apply late since the funds are limited.

Private Loans

Obtaining private loans should be your last resort in case you can’t cover the full college cost with federal aid and your savings. Usually offered by private institutions like banks, online lenders, and credit unions, these loans typically require a cosigner who can pay them off in case you fail to do so. You can cosign a private loan with your child, which is a good option if you decide to split the cost of college. These loans require a good credit score to qualify, though, so they may be harder to obtain if your or your child’s credit is bad.

Do Student Loan Applications Require a Credit Check?

Applying for student loans usually doesn’t involve credit checks for you or your child. However, there are two exceptions to this rule:

Type of Loan	Explanation
Direct PLUS loans	Both Parent PLUS and Grad PLUS require a credit check, meaning that your child may not be approved for the loan if your or their credit score doesn’t meet the lender’s standards
Private student loans	Private lenders usually require a credit check for students, and they may even consider your credit score if you want to cosign your child’s loan

Federal aid may not require credit score information during the application process, but building and maintaining good credit helps your child secure more financing options in case they don’t get federal student aid. A strong credit score can help your child obtain a student loan more easily and secure loans with favorable interest rates in the future, saving them a substantial amount of money as a result.

A service like FreeKick offers an affordable way for your child to establish a strong credit profile early on through parent-sponsored credit building. They can start building credit as early as the age of 13 to secure a solid financial future by the time they reach young adulthood.

FreeKick—Premium Credit Building and ID Protection

FreeKick is an FDIC-insured deposit account provided by Austin Capital Bank that assists you in building credit for young adults and minors between the ages of 13 and 25. The platform also provides identity monitoring and protection for your entire family, covering up to two adult parents and six children aged 0 to 25.

Build a Strong Credit Profile With FreeKick

Starting your child’s credit building journey early can help them not only secure college funds but also save more than $200,000 throughout their lifetime. That’s why FreeKick lets you establish credit for your child from the age of 13 through parent-sponsored credit building. Here’s how the process works:

1. Create an Account—Go to FreeKick.bank and pick a plan that fits your family’s needs and budget. Consider the amount of deposit and annual fee tradeoff when making your decision
2. Set It and Forget It—When the account is activated, FreeKick automatically starts building credit for your child over the next 12 months through a no-interest credit builder loan
3. Keep Growing—Once the first 12-month period passes, you can either close the account and get a refund of your initial deposit or renew it and keep building your child’s financial future

Keep Your Identity Protected With FreeKick

Alarming reports show that a child’s identity is stolen every 30 seconds, with identity theft statistics confirming that child identity theft is a growing crime.

The risks of this crime include student loan identity theft, which makes it crucial to protect your child’s identity when they’re applying for college loans. Otherwise, their personal information can be stolen and used to submit the FAFSA, automatically making your child’s application invalid. For this reason, FreeKick has comprehensive security features that protect both adults and minor children:

Services for Adult Children and Parents	Services for Minor Children
Credit profile monitoring SSN monitoring Dark web monitoring for personal information Up to $1 million identity theft insurance Full-service white-glove concierge credit restoration Lost wallet protection Court records monitoring Change of address monitoring Non-credit (Payday) loan monitoring Free FICO® Score monthly FICO® Score factors Experian credit report monthly	Credit profile monitoring SSN monitoring Dark web monitoring for children’s personal information Up to $1 million identity theft insurance Full-service white-glove concierge credit restoration Sex offender monitoring—based on sponsor parent’s address

FreeKick Pricing

FreeKick offers two different plans to suit every family’s budget, regardless of its size. Plus, both plans are FDIC-insured up to $250,000. Find more details in the table below:

FDIC-Insured Deposit Amount	Plan Fee
$3,000	$0 (Free)
No deposit	$149/year

Strengthen your child’s credit profile through parent-sponsored credit building and protect your whole family from identity theft—sign up for FreeKick today.