Millennials Are Not Saving Enough For Their Children's College Education

Many want to cover their child’s college costs to avoid student loans

Millennials Are Not Saving Enough For Their Children's College Education
August 29, 2016

Millennials have worked hard to avoid debt, with many refusing to take out credit cards and other types of unsecured debt. These young consumers have also expressed a desire to keep their children out of debt, and according to research by Fidelity Investments, many plan to save enough money to cover all or most of their children's college expenses.

The survey showed that a number of millennial parents now hope they can cover at least two-thirds of their children's college costs. In 2012, when asked how much of their children's higher education they hoped to pay for, the average came out to be 57 percent. A good number of those who responded, 43 percent, said they would like to save enough to pay for all of their child's college expenses.

Unfortunately, despite their good intentions, few parents are actually saving enough money to meet these goals. In its survey, Fidelity looked at 2,196 couples who have at least one child under the age of 18 and plan on sending that child to college in the future. Almost three-fourths of the parents had gone to college (71 percent), and the average income was a little under $100,000.

After analyzing the information the families provided, Fidelity was able to determine that only 29 percent had actually saved enough to cover 70 percent of costs. That number has increased by two percent since last year, but most parents are still not saving enough.

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