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One statistic that's commonly left out of these discussions & articles is how late parents save for college. According to Sallie Mae (http://news.salliemae.com/

One statistic that's commonly left out of these discussions & articles is how late parents save for college. According to Sallie Mae (http://news.salliemae.com/publication/how-america-saves-college-2016 http://news.salliemae.com/publication/how-america-saves-coll...), most families don't start saving before their oldest child reaches 7 years old. This effectively robs 1/3 of the investment period's growth potential. Another one (as perhaps a consequence of the previous fact) is that the average family ends up saving up ~$16K, while the average grad leaves colleges with an average of ~37K in debt. As most experts in the field agree, the key winning strategy is starting to save as early as childbirth, even if it's a small amount.

habosa 9y ago
On the one hand, yes that's late. On the other hand it's sort of insane how you need to start putting money away for a child's education when they're only seven years old! You have no idea if the child will even want to go to college, how much their college of choice will cost, etc.
jedberg 9y ago
It's good in theory, but most new parents don't have the spare cash to start saving at birth, unless they are already fairly well off. I was lucky enough to have kids late in life and I can afford to put money in their college fund now, but most new parents sadly can't.
- deleted 9y ago
  [deleted]
mantas 9y ago
Another statistic is that in quite a few places in the world families don't have to save money for kids' education at all. Looking from Europe, it looks like a weird cultural artefact. If someone I knew did this, my reaction would be "wtf, why don't you pay off your mortgage or go on vacation?".
anonemouse145 9y ago
You sound like a cigarette executive. "The real problem is we don't start em smoking before they leave the hospital. We could increase our profits 33% if every baby was exposed to nicotine before they leave the hospital." Maybe not all people in society should be socially required to purchase an expensive good, thus causing demand to be infinite, meaning price can only skyrocket. Given the number of Masters degrees working minimum wage or starting jobs now maybe we should admit we have a problem.
- InitialLastName 9y ago
  Ok. Let's replace "saving for college" with "saving for the child's introduction to adult life". If you bring children into the world, it's your responsibility to do whatever possible to plan for their future as early as possible. If we've decided that people can't contribute to society until they're 23, they're going to need some investment for their early adulthood, whether it's college, vocational school, doing art and working minimum wage in a big city.
- ihsw2 9y ago
  Those are two separate issues and it is only prudent that parents relive their children of crushing debt. Would you rather parents piss away their wealth on frivolities? Passing on wealth is the hallmark of a wealthy society and it's rocket fuel that elevates us beyond destitution. Whether it is debt relief, real estate property, or arcane financial instruments -- passing on wealth to their children is the right of every parent. The efficacy of master's degrees is unrelated to the social responsibility of post-secondary education funding. You might as well argue we all starve ourselves to pressure the government to do something about it. The real issue behind student debt growth is payment, and with the US Government as a guarantor then growth potential is effectively infinite. Colleges will continue to feast unabated.
randomdata 9y ago
Wouldn't the winning strategy be for the child to wait to go to college until they can afford it? It is not something you need to rush into. If it is worth doing, it will still be there to do down the road.
Top19 9y ago
Your point is interesting. That being said, ughh anyone who pushes this smacks of neoliberalism. Wow now parents have to save from the birth of their child. When will it start being considered “responsible” to save 10 years before a child is born and if you don’t you’re irresponsible cuz you missed 10 years of growth. When will it start being considered “responsible” to save for your grandkids college?
- WkndTriathlete 9y ago
  I think the real point is how parents can help their children win the game according to its current rules, not what post-secondary education finance policy is or should be. Personally, I think the economy would benefit from appropriate government-financed post-secondary education for those students that show an aptitude for it. However, I suspect that a test-based system similar to that employed in Europe or elsewhere is politically untenable here ("I should have the freedom to choose to go $336k* into debt at an elite photography school!") (*NB: I wish I was making that number up but there was someone that actually made this choice a number of years back.)
- enraged_camel 9y ago
  What does neoliberalism have anything to do with it?
yardie 9y ago
Wages have stagnated while CoL has gone up but yes the problem is parents aren't saving enough.
dsfyu404ed 9y ago
Why would you save? So the school can take it all? Better to stuff your retirement accounts full of as much money as you can, buy some gold bars to bury and take a job for a nonprofit that pays peanuts 2-ish tax years before your kids need to go to college.

habosa 9y ago

On the one hand, yes that's late. On the other hand it's sort of insane how you need to start putting money away for a child's education when they're only seven years old! You have no idea if the child will even want to go to college, how much their college of choice will cost, etc.

jedberg 9y ago

It's good in theory, but most new parents don't have the spare cash to start saving at birth, unless they are already fairly well off. I was lucky enough to have kids late in life and I can afford to put money in their college fund now, but most new parents sadly can't.

deleted 9y ago
[deleted]

mantas 9y ago

Another statistic is that in quite a few places in the world families don't have to save money for kids' education at all. Looking from Europe, it looks like a weird cultural artefact. If someone I knew did this, my reaction would be "wtf, why don't you pay off your mortgage or go on vacation?".

anonemouse145 9y ago

You sound like a cigarette executive. "The real problem is we don't start em smoking before they leave the hospital. We could increase our profits 33% if every baby was exposed to nicotine before they leave the hospital." Maybe not all people in society should be socially required to purchase an expensive good, thus causing demand to be infinite, meaning price can only skyrocket. Given the number of Masters degrees working minimum wage or starting jobs now maybe we should admit we have a problem.

InitialLastName 9y ago
Ok. Let's replace "saving for college" with "saving for the child's introduction to adult life". If you bring children into the world, it's your responsibility to do whatever possible to plan for their future as early as possible. If we've decided that people can't contribute to society until they're 23, they're going to need some investment for their early adulthood, whether it's college, vocational school, doing art and working minimum wage in a big city.
ihsw2 9y ago
Those are two separate issues and it is only prudent that parents relive their children of crushing debt. Would you rather parents piss away their wealth on frivolities? Passing on wealth is the hallmark of a wealthy society and it's rocket fuel that elevates us beyond destitution. Whether it is debt relief, real estate property, or arcane financial instruments -- passing on wealth to their children is the right of every parent. The efficacy of master's degrees is unrelated to the social responsibility of post-secondary education funding. You might as well argue we all starve ourselves to pressure the government to do something about it. The real issue behind student debt growth is payment, and with the US Government as a guarantor then growth potential is effectively infinite. Colleges will continue to feast unabated.

randomdata 9y ago

Wouldn't the winning strategy be for the child to wait to go to college until they can afford it? It is not something you need to rush into. If it is worth doing, it will still be there to do down the road.

Top19 9y ago

Your point is interesting. That being said, ughh anyone who pushes this smacks of neoliberalism. Wow now parents have to save from the birth of their child. When will it start being considered “responsible” to save 10 years before a child is born and if you don’t you’re irresponsible cuz you missed 10 years of growth. When will it start being considered “responsible” to save for your grandkids college?

WkndTriathlete 9y ago
I think the real point is how parents can help their children win the game according to its current rules, not what post-secondary education finance policy is or should be. Personally, I think the economy would benefit from appropriate government-financed post-secondary education for those students that show an aptitude for it. However, I suspect that a test-based system similar to that employed in Europe or elsewhere is politically untenable here ("I should have the freedom to choose to go $336k* into debt at an elite photography school!") (*NB: I wish I was making that number up but there was someone that actually made this choice a number of years back.)
enraged_camel 9y ago
What does neoliberalism have anything to do with it?

yardie 9y ago

Wages have stagnated while CoL has gone up but yes the problem is parents aren't saving enough.

dsfyu404ed 9y ago

Why would you save? So the school can take it all? Better to stuff your retirement accounts full of as much money as you can, buy some gold bars to bury and take a job for a nonprofit that pays peanuts 2-ish tax years before your kids need to go to college.