You have helped your child work through the alphabet and arithmetic in elementary school, made sure he kept on track with homework through middle school and guided him in high school to ensure he studied and received grades that would get him into the colleges of his choice. It was worth it, because your child succeeded and is headed toward making one of the biggest decisions of his life—at least to this point—choosing a college and a major. This decision will set a path for your child’s future, and you want to be there to help.

There are a few questions parents in households throughout America ask themselves on the journey to seeing their children off to college. Should they pay for their children’s college education? Should they guide their children to study in a major that is likely to make them more money? Is it better for children to immerse themselves in what they love regardless if their future pay will barely allow for them to make ends meet?

Should You Pay for Your Child’s College Education

With a college career comes higher pay, more choices for careers and, according to research, longer lifespans. The average college graduate is expected to be in debt just after he walks on the stage to get a diploma. College graduation and debt are about as consistent as the cap and gown. With that figure, it is already projected that their retirement savings will be chopped by more than $300,000, according to Limra, an insurance and financial research group.

To put a little more light on the subject, projections are that the average cost of putting two kids through public college (in-state), which would include dormitory bills, transportation and extra courses that are now a requirement for most students, is estimated at $200,000. If they opt for a private school, the figure is doubled.

Should I Pay for My Kid’s College?

Should You Pay for Your Child’s College Education

With a college career comes higher pay, more choices for careers and, according to research, longer lifespans. The average college graduate is expected to be in debt just after he walks on the stage to get a diploma. College graduation and debt are about as consistent as the cap and gown.

With that figure, it is already projected that their retirement savings will be chopped by more than $300,000, according to Limra, an insurance and financial research group.

To put a little more light on the subject, projections are that the average cost of putting two kids through public college (in-state), which would include dormitory bills, transportation and extra courses that are now a requirement for most students, is estimated at $200,000. If they opt for a private school, the figure is doubled.

You want to help your child with his future plans of college, but then you would have to use your 401(k) plan savings. (A T. Rowe Price study found that about one-third of parents used savings from 401(k) plans. Then, what happens to your savings for the future. Should you give up what you have worked for, saving up pennies and struggling through the hard times to enjoy the retirement years?

According to Sean T. Keating, a certified planner in New Jersey, “you can always borrow money for college, but you can’t borrow money for retirement.”

Options to Consider for Your Child’s College Dream

“Middle income parents need to ensure their financial stability first,” said Lazetta Rainey Braxton, a certified financial planner and founder of the wealth advisory firm, Financial Fountains. There are a few questions to answer prior to doling out money to your child’s college to determine if you can afford to help.

  • Savings for retirement should be 80 percent of annual income. By working backward, said Keating, you can find out how much you can afford today. It is important to remember mortgage payments and any other debts you owe. In addition, have the knowledge of what you may be giving up and what you will do if the money runs out when you are in your 70s, as well as ensuring that your medical expenses are covered.
  • Do what you can now to ensure you are spending your money wisely. You may be able to refinance a mortgage now in order to save hundreds of dollars a month.
  • Beware of discouraging a child from applying to college at all when you flat-out tell him that you aren’t able to pay. He may not realize there are many things he can do, such as get application fees waived. Parents can help in the college application and financial aid paperwork by filling out the Free Application for Federal Student Aid (FAFSA). This is an important application, because it opens a door to apply for scholarships based on merit, offers grants from certain schools and provides federal aid. Even if your income bracket is too high for financial aid, the boost that possible scholarships and grants give to help pay for college may make the difference in the choice of schools, as well as ease the burden of debt.
  • Negotiation is important. While the FAFSA numbers might seem meager, it may not be the “final answer.” In fact, if a student is an excellent candidate, the school might offer more financial help. In addition, your child should let the college know that he has been accepted at other competitive schools (make sure to have the list handy when speaking with the college’s financial aid department). It may help.
  • Your child will actually impress financial aid personnel by being straightforward and asking about scholarships.
  • Don’t give up. By the second semester, there may be money available because of the students who leave. It is important to ask again for additional aid prior to the second semester.
  • A child does not have to start college the fall semester after he graduates. In fact, taking a year or two off between high school and college may give him the chance to earn the money necessary to make ends meet. In addition, he may be more ready emotionally after waiting to enter college.
  • Students can opt to enroll in a community college for two years and then transfer to another college to help save money.
  • You can make a deal with your child that you will assist in paying loans if his grades are good. However, it is interesting to learn that a study showed that students who had less financial support from parents received higher grade point averages.
  • Your child may have to work at a job on campus or one close to the college to help pay for college. He can also find work during vacations from college, opting to make money instead of spending it on getaways like spring break.
  • If you are not able to make ends meet for yourself, it is advisable not to pay for your child’s college education. A college education is not required for every child, and parents should not be expected to pay for it. However, if you feel you need to pay for your child’s education, ensure that your finances are in order and start saving in a 529 college savings plan every month.

Study What You Love, or Study What Will Make You Money?

Your son wants to go to college to be a writer. Or, maybe your daughter has been in every high school play and has dreams of being in a Broadway musical. You want your child to be happy and do what he loves, but how many writers actually get on the best-seller list? Your daughter is a good actor, and everybody thinks she can sing with the best of them, but how many other kids have their hearts set on making it big on one of the stages in the Big Apple?

Wouldn’t these college majors lead to meager pay, years of struggle and no way to pay off that huge college debt? Wouldn’t all that money spent on college be better used for majors like business administration and engineering, where it would pay off and your child could possibly make the big bucks? Or, would your child succeed and excel in something he loved, working at it passionately and dedicating hours to the craft?

Reasons to Study What You Love

  • Employment can be difficult to secure in any career, so trying with a subject you like may be a good bet.
  • While parents and teachers may only focus on the end result—what kind of job the student will get—it is more sensible to think about the whole picture. If the subject is one a student loves, it may be worth the risks.
  • Steve Jobs put it this way: “The only way to do great work is to love what you do.” When you have a real interest in something, there is no faking it.
  • Don’t underestimate how important happiness and fulfillment are in your life. In fact, they are not based on income. Studies have shown that there is little relation between salary and job satisfaction.
  • If you don’t study what you love, other people will. Down the road, you will see other people the same age finding happiness and excelling in your dream field.

Choose a Major that is an Investment

  • A degree is a long-term investment. You should study what will make you money, especially because the college tuition will need to be paid back. In addition, the profit should be financial and not only academic.
  • Maybe you love art and think you are good at it. However, if it is something you dabble in once in a while, maybe it is wise to major in something else.
  • You should major in what your strengths are instead of what your passions are. They should not be confused. However, you may be passionate about something that you have strength in—that is considered lucky.
  • You can secure a job that pays well. On the weekends, holidays and after work, you can make the time to enjoy what you love doing. You do not need to go to college to study what you love. Instead, you can study what will make you money so you can have time for the things you like.