Every so often, Sallie Mae and Gallup put out information about how Americans save for college costs. This is especially of interest this month, since it is National College Savings Month. The most recent report shows that, on average, families need to save 5.7% of their income in order to meet college savings goals. Now, I don’t know whether this is per-child (because that could get expensive with more than one child), but it still seems like a lot.
Many of us have a hard time saving close to 6% of our income for retirement, let alone paying for college costs. Another point of interest I would have about this information is whether or not these parents plan to cover all of their children’s college costs. To tell the truth, I think it would do kids some good to help pay for their own educations.
And, finally, I found it very interesting that those families with low to modest incomes are actually saving more for their kids’ college educations than are families in higher income brackets. This really startled me. I wonder what it says about who values education, and whether some of these families with more modest means are encouraging their children to get an education in an effort to help recession-proof themselves.