Survey of 1,000 parents across the nation also surfaced interest in career training and workforce preparedness
WASHINGTON, Nov. 10, 2023 /PRNewswire-PRWeb/ -- The vast majority of parents across the country see their children participating in higher education, with 81% expecting them to attend any of a growing variety of options, such as traditional 4-year college, vocational, and career and technical schools. Looking further, 89% believe that they will continue to require ongoing education and additional skills throughout their lifetimes. These are among key findings of the 17th annual State of Higher Ed Savings survey conducted by the College Savings Foundation (CSF) of 1,000 parents across the country.
For an infographic on the findings see: https://www.collegesavingsfoundation.org/press-releases/higher-ed-is-path-to-childrens-future-say-u-s-parents-in-college-savings-foundation-survey/
To help children attain that future, parents are onboard to help. 81% plan to fund their children's higher ed, with 28% paying primarily through savings, second only to the 37% of parents who expect help from grants, scholarships or direct aid. Nearly half of all respondents, 47%, had saved at least $5,000 per child.
"After three years of disrupted education experience for our young people, we are seeing that higher ed is an important goal of parents across the nation, and we are pleased to learn that they are valuing and saving for it," said CSF Chair Vivian Tsai. CSF is a leading national nonprofit helping families save for education for a lifetime.
At the same time, 70% of parents said that higher education has to change, with 38% of those parents saying that the most important changes needed include classes focusing on career needs and training, and 26% desiring schools that provide credentials along with degrees to better meet workforce needs.
The concerns of parents correspond with the findings from CSF's 14th Annual Youth Survey of high school students released in August 2023, showing that 89% wanted credit for actual work that they plan to do in conjunction with the higher ed institution; and 89% wanted more job placement and counseling services as they embark on their chosen careers.
This focus on career and workforce readiness extends to the parents themselves. Nearly half, 46%, said that they were interested in changing careers and would need additional education or certifications to do that and 17% of respondents have already started.
When asked what kind of credential or diploma is important today, 31% said a four-year degree from a traditional college, 11% said a credential from a vocational or career and technical school, and 54% said both were important, another indicator of the increasing acceptance and importance of workforce training today.
How Families are Saving in 529s
Nearly a third of all parents surveyed, 29%, are saving in a 529 education savings plan, with 80% of those using a strategy of systematic recurring contributions. Of the parents expecting their children to contribute to higher ed costs,18% said their children were saving in a 529 account. Some other highlights:
- Preferred method of saving: 20% of all parents said 529s are their primary way to save, on par with the 21% primarily using non-tax advantaged CDs or bank savings accounts.
- Awareness of usability: 40% of all respondents knew that 529s may cover qualified tuition and expenses for career and technical/vocational education as well as traditional 4-year college. One quarter (26%) are aware that 529s may be eligible to be rolled over into a Roth IRA in the beneficiary's name beginning in 2024.
Roughly one-quarter of respondents are aware that 529s can be used for computers, books and technology software; that 529s may be used for up to $10,000 for K-12 tuition; and that 529s can be used toward student loans, with a lifetime maximum of $10,000 per student.
- Parents' own careers: 27% of all parents said that they know a 529 education savings plan can be used for their own education, and 22% plan to use it in that way.
- A 529 Debit card: CSF asked parents if a 529 offered a debit card for qualified education expenses, would they allow their child to use it. 71% of all parents said "yes," of which 40% said that option would be convenient and 31% would agree to it as long as they can apply spending limits.
Other Ways to Pay for Higher Ed
Most parents (84%) are having conversations with their children about the costs of higher education and their involvement in it. A significant majority of parents (69%) expect their children to help pay for higher ed, primarily through jobs, scholarships, grants and fellowships.
Even with saving and student participation, a substantial majority of parents (65%) still would take out loans, with 61% anticipating education loans. Among the 35% who would not take out loans, 52% of them said it's because they "do not want debt."
How Families Pay for Higher Ed at Different Life Stages
The survey provided insight into families' plans for higher education with a section for parents with children 15-17 years old and one for parents whose children are between the ages of 18-25.
Among parents with children aged 15-17, 50% said their child was heading to traditional public (37%) or private (13%) schools. An additional 13% said their children were going to vocational or career and technical schools, and 12% to community college. 16% said their children didn't know yet, but 4% expect their children to go to workforce training and credentialing and 3% into the military out of high school.
Among the parents of 18-25-year-olds, 47% of all those said their child was in a 4-year college (31% public and 16% private), 15% in community college, 7% in career and technical ed, 3% in workforce training/credentialling, 3% in the military, and 21% not attending higher ed at all.
Across all the educational opportunities available, 81% of these parents said their child believed their choices were preparing them for the future. When asked why, almost half (44%) focused on the coursework being relevant to their career choice. 21% said it offered a basic educational credential from which they can specialize in the future, and 18% cited access to internships and work experience. 40% of this group said that tuition and fees incurred for higher ed today represent a good value for the education their child is receiving.
The CSF 2023 State of Higher Ed Savings survey of parents was conducted with 1,000 parents across the country via Survey Monkey. The College Savings Foundation (CSF) is a Washington, D.C.- based not-for-profit organization helping American families achieve their education savings goals for a lifetime. www.collegesavingsfoundation.org
Media Contact
Lynthia Romney, CSF, 1 9145892140, [email protected], www.collegesavingsfoundation.org
SOURCE CSF
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