How and when to talk about the cost of college with your kids


College is a major expense. Nearly three-quarters of parents now talk to their kids about how much money it costs, according to a 2018 survey from T. Rowe Price. Researchers surveyed 1,014 parents with children ages 8-14, and 1,000 young adults ages 18-24.

For most families, though, these conversations don't happen all that often, even though there's a lot of ground to cover.

Try talking about the cost of college regularly and starting earlier, experts suggest. Having ongoing conversations helps students better understand the financial aid process and prepares them to make thoughtful choices. They can "think about what they're attending college for and [if] that will get [them] a job, as opposed to just attending college because everyone else is," says Victoria Fillet, a certified financial planner at Roosevelt Wealth Management in New York City.

You could even begin during your child's freshman year of high school, says Sean T. Keating, a certified financial planner at Patriot Financial Advisors in Long Branch, New Jersey.

The average price tag for tuition, room and board, and fees for an undergraduate at a public four-year college was $19,080 during the 2018-2019 academic year, according to The College Board. The average jumps to $46,680 for a private nonprofit four-year college. It's important to remember, though, that university "sticker prices" do not account for scholarships, grants, or tax benefits — and some states offer free or reduced tuition for families who make below a certain amount.

Setting expectations early will help your kids figure out what kind of college may be right for them, and how they can pay for it. Here are three guidelines experts suggest you following in discussing the costs of college with your kids.

1. Start early

Saving for college requires a head start, and the conversation around paying for school often does too. With lots of notice, kids can think well in advance about how they're going to contribute, either by earning money themselves during the summers or finding and filling out scholarship applications.

Before sitting down with your child, Keating says, take a look at what you've saved up and compare it to the average cost of a college education, or the likely cost of the kind of program your kid wants to attend. That can make it easier to set expectations and be clear on what portion, if any, you'll be able to cover.

It makes them think about what they're attending college for and [if] that will get [them] a job, as opposed to just attending college because everyone else is.
Victoria Fillet
Certified financial planner

While it's important to paint an honest financial picture, you don't need to overshare on details, says Fillet. Instead, talk broadly about the types of payments you're currently juggling, like a mortgage, car payments, and insurance, and how the added cost of college will affect your monthly cash flow.

Starting the conversation early can help students "figure out what things they can do to qualify for grant money while in high school," says Keating.

2. Get a sense of your child's goals

Your student probably won't have a shortlist of colleges until junior or senior year of high school, but it's important to explore a variety of options including public, private, and community colleges, says Keating.

Since some of these options are vastly more expensive than others and could require loans, ask your teen questions about their potential career path and if they're aware of the responsibility that comes with taking on significant debt. A good general rule is that your student loan debt shouldn't exceed your annual starting salary.

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3. Help develop a funding plan

After coming up with a list of schools that make sense and setting expectations about how much you can chip in for your child's education, you can work together on a plan to fund the remainder, says Fillet. Figure out ways to "subsidize the rest with scholarships, grants, or student loans," she says.

Apply for financial assistance with your student so the task seems less daunting, suggests Keating.

Emphasize that "college makes future dreams available and possible, or you could be in student debt for the rest of your life," he says. "Help them weigh today's decisions against future decisions."

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