It is usually assumed that you should pay for your children’s educational costs if you are financially able to do so. And this of course makes sense, since student debt can restrict millennials from achieving a number of life goals. As previously mentioned on this website, student loans can impede recent graduates from buying a home, saving for retirement, and achieving a number of other financial aspirations. Having parents pay for educational expenses can be a huge advantage, since this enables recent graduates to set themselves up for financial success.
However, I have heard from several parents recently who regret their decisions to pay for their kids’ educational expenses. Some of these parents regret their choices because their children have not repaid them back as expected, and this website has already discussed repayment agreements between kids and their parents. However, other parents have related that they regret their decision to pay for their kids’ educational expenses, since they believe that their kids are worse off because they did not need to borrow student loans to pay for college and graduate school costs.
Many parents have told me that after paying for their kids’ educational expenses, their children never strived to succeed in their lives. Parents have explained to me that people who borrow money to earn a degree value their education much more than people who have their parents pay for their educational expenses. Some parents argue that this makes individuals who self-financed their education more committed to succeeding in school. In addition, others have argued that if you have student loans to pay back, you are going to do everything possible to land a good job and succeed vocationally so that you can manage your student debt.
In addition, other parents have told me that repaying student loans teaches valuable life skills that people without student debt do not learn. Indeed, repaying student loans instructs individuals to be fiscally responsible, goals oriented, and financially independent. Some parents who paid for their kids’ educational costs have told me that their children are still financially dependent on them years after they graduated. Many parents have conveyed to me that just how these parents had to pay for their children’s educational expenses, later on, these parents also had to pay the rent and other costs of their children after they reach full adulthood. Some parents wonder whether their kids would have been better off if they had to borrow student loans to pay for college or graduate school.
As someone who had to pay for his own educational expenses, I think there is something to the idea that it might be harmful to pay for your children’s educational costs. Throughout college and law school, I valued my education immensely, since I was paying for it all by myself. Indeed, I never skipped a lecture because I thought about how my money would be wasted if I did. I also devoted myself to my studies, so that I had the best chance possible of landing a job that would allow me to pay off my student debt.
Repaying student loans also taught me extremely important financial lessons, such as the value of money and how powerful compounding interest can be. In addition, working part-time jobs to pay off my debt and saving money to devote additional cash to student loans taught me incredible discipline. Of course, student loans brought me much stress throughout my student debt repayment journey, but as the old saying goes. whatever doesn’t kill you makes you stronger!
I do think that it is important to pay for your children’s college costs if you are financially able to do so. College has become the new high school, and a college education is extremely important to succeeding in our modern world. It is more of the norm that parents will pay for their kids’ college expenses, and if parents are able to pay for these costs, and refuse not to, their financial situation could disqualify their kids from financial aid. Since a college education is very important, and the financial status of parents could make their kids ineligible for financial help, it s usually advisable for parents to pay for their kids’ college expenses if they are able to do so.
However, graduate school is a totally different story. Not everyone needs to attend graduate school, and unless you are going into the legal, financial, or medical fields, a graduate degree is usually not necessary for someone to succeed. Indeed, we all probably know someone who picked up a graduate degree in some obscure field and never applied that knowledge. I personally have an M.A. degree in American history that I obtained for free, and I never use this degree! Forcing a kid pay for graduate school themselves can ensure that the are serious about pursuing graduate studies, and can teach a number of important life lessons.
It is also worth mentioning that you should not typically feel guilty about being unable to pay for your children’s educational costs. I receive emails from parents all the time who convey their guilt and shame for not paying for their kids’ college or graduate school expenses. However, children could actually be better off if they have to pay their educational costs on their own. For this reason, there is usually no reason to feel guilty about not being able to pay for your kids’ educational expenses.
All told, the conventional wisdom that you should pay for your children’s educational costs if you are financial able to do so might be flawed. As I can relate to from personal experience, repaying student loans can sometimes have a positive impact on your life. Of course, having parents pay for educational costs can make things easier, but parents shouldn’t sweat it too much if their kids need to borrow student loans to earn a degree.