Sending Your Kids to College: What Should You Really Expect?

Presented by Lucas Group Financial Advisors |

It’s no secret that the cost of pursuing higher education is becoming harder to afford. If you have aspirations of sending your child to college, there are many details to consider.

According to the College Board’s Trends in Higher Education,  the average budget for a public, four-year in-state education in 2021-2022 is $27,330. If your student is looking at a private college, it could cost around $55,800. These numbers seem astronomical, but when you estimate the costs involved in going to college, it’s easy to see how it adds up:

Table showing the average budgets that a student at an in-state, out-of-state, and private nonprofit college may have. It includes tuition, room and board, books, and personal expenses

What are parents to do?

If you’re serious about securing a college education for your child, you should start saving as early as possible. But this shouldn’t be done at the expense of your other financial priorities, such as retirement. You should consider your overall financial plan, and aim to direct your resources to your most important financial goals.

Unfortunately, depending on your situation, it may not be possible to save enough to fund a college education. So where will the funding come from?

Financial Aid 

It is estimated that 83% of college students benefit from financial aid. Even affluent families may qualify for financial aid through federal grants as well as colleges themselves. Determining financial aid eligibility can be somewhat complicated, but the general formula considers your child’s assets first and then determines a family contribution portion of aid. It’s recommended that you start financial aid planning as early as high school.


Future college students don’t need to be the brightest or most athletic to receive scholarships. There are scholarships of all forms and sizes available. Though some may seem small, they can add up. Your school counselor and community leaders can help you learn more about finding various scholarships.

Community College

More and more, community college is becoming a viable (and financially smart) alternative for the first few years of college. A community college can offer the general education credits required for graduation, as well as an Associate's Degree or other certification in many areas. A student can save a significant amount of money by staying home and attending the local community college, then transfer to a university to finish their bachelor's degree.

One word of caution: different universities accept transfer credits in different ways. When choosing to move from a community college to a 4-year university, the student should work with counselors to determine how many of their credits will transfer, and how many would still be required to finish a degree. They may find that one university accepts more transfer credits than another, which may affect their choice of university.

Education Loans

Though more widely available, school loans can be a double-edged sword for students (and parents). Approximately 43.4 million college students graduate with federal student loan debt, and about 15% of student loans are in default. Borrowing for college expenses should be a last resort, but, if it’s done within the context of a well-conceived financial plan, it may not become an insurmountable burden.

In addition to federal loans offered to student borrowers, there are also private loans that will require a parent co-signer, or federal Parent Plus loans. Although these loans may help you send your student to the college of their choice, they should be approached with caution. Loans in the parent's name (such as Parent Plus loans) are the responsibility of the parent, not the student; and if co-signing, the parent may become responsible for additional loans as well if the student is unable to afford the payments.

According to the US Department of Education, in the first quarter of 2022, there was a total of $384.5 billion dollars of federal student loans held by borrowers aged 50 and above. This was disbursed across 8.9 million borrowers, for an average balance of $43,202. This can present a hardship if the borrowers carry this debt into retirement, or are unable to save for retirement due to the student loan payments. 

Being able to afford higher education for your child can be challenging, and should be balanced with your other financial goals. If you’re not sure how saving for your child’s college fits within your overall financial plan, consider speaking with a financial professional.

College Board, Trends in College Pricing and Student Aid 2021,

Hanson, Melanie. “Financial Aid Statistics”, February 15, 2021,

Hanson, Melanie. “Student Loan Default Rate”, December 19, 2021,

Hanson, Melanie. “Student Loan Default Rate”, December 19, 2021,


This content is developed from sources believed to be providing accurate information. The information provided is not written or intended as tax or legal advice and may not be relied on for purposes of avoiding any Federal tax penalties. Individuals are encouraged to seek advice from their own tax or legal counsel. Individuals involved in the estate planning process should work with an estate planning team, including their own personal legal or tax counsel. Neither the information presented nor any opinion expressed constitutes a representation by us of a specific investment or the purchase or sale of any securities. Asset allocation and diversification do not ensure a profit or protect against loss in declining markets. This material was developed and produced by Advisor Websites to provide information on a topic that may be of interest. Copyright 2024 Advisor Websites.