In a recent survey more than 75% of parents say they would delay their retirement to pay for their children’s college. Almost 70% of parents said they would take on a second part-time job to help get their kids into college.
Source: Pew Research Center
It is growing increasingly common for Americans over the age of 65 to be active in the workforce. The number has been steadily growing since 2000 according to the Pew Research Center. If wages stay stagnant that number could end up skyrocketing with currently no way to combat our growing inflation rates. In a recent survey more than 75% of parents say they would delay their retirement to pay for their children’s college. Almost 70% of parents said they would take on a second part-time job to help get their kids into college.
Marty Allenbaugh, a senior marketing manager at T. Rowe Price, said, “Parents are feeling the pressure and the anxiety” to afford college. The very same put on today’s college students knowing not only is it increasingly difficult to leave college with job prospects but to just leave college without tens of thousands of dollars in debt.
Parents are taking on more of the burden of their kid’s schooling, in general, these days. In the 1989-1990 academic year, borrowers that had Parent PLUS loans, these are loans for parents to take out to finance their children’s education, was 4.1% but by the 2011-2012 academic year, it had grown to 19.9%. Unfortunately, these parents who are taking on loans to help their kids they won’t be able to see a return on investment they made in the way of a degree and statistically a better chance at higher wages like the actual graduates do.
Taking on loans to finance their kid’s education could and probably will push back their retirement date. Especially since most parents would be struggling to make loan payments on a fixed income. Sometimes that struggle can lead to your loans going into default and the government has the power to seize a portion of senior’s Social Security checks if they actually end up defaulting. According to a 2014 report from the Government Accountability Office, in 2002 6,000 people had their benefits reduced over unpaid student loans. By 2013 it jumped up six times the amount to 36,000 people.
Parents who are willing to go the extra mile should either save for their retirement first before focusing on their children’s college as hard as it may sound. Allenbaugh said, “You want to make sure you’re helping them as much as you can, but you don’t want to hinder yourself so that you’re a financial drain on them.” At the very least make yourself knowledgeable of ways to deal with your loans through income-driven repayment plans, forbearance, and deferments to make sure you can make the most out of your loans and stay out of default.
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