When you think about teenagers today, “forethought” and “practicality” probably aren’t the first words that come to mind.
But if recent research is any indication, adolescents may be a lot more prudent than we’ve been giving them credit for—especially when it comes to saving for college.
In fact, the 2014 Teen College Savings Barometer study found that as many as 93% of teens said stashing away cash for school was a priority for them—and 91% expected to cover at least some of their own higher-education costs.
Needless to say, the numbers piqued our interest. But we couldn’t help but wonder: Howexactly do teens expect to pay their own way?
To find out, we asked three recent high school graduates and two current seniors to tell us how they’re going to swing the tuition and fees—and then tapped their parents to weigh in on their plans, as well. We also consulted David Blaylock, CFP®, a senior financial planner at LearnVest Planning Services, for his input on how prepared—or not—these future university students really might be.
The Future Pharmacist: Natalie, 18, a senior at Lexington High School in Mansfield, Ohio
Her Top Picks Ohio Northern, University of Toledo, Miami University, Mount Union, Wittenberg University and University of Dayton
What They Currently Cost Toledo—at around $18,000 a year for tuition, fees, and room and board—is probably the least expensive. Ohio Northern will cost at least $40,000 a year.
Her College Payment Plan My parents and I started doing college research last year. Right now I am leaning toward majoring in pharmacology, and Ohio Northern and the University of Toledo have really good programs for that. I can also become a physician’s assistant or get a degree in chemistry or biochemistry.
To make money, I’ve been babysitting part-time, making $60 a day. I intend to work full-time or at multiple part-time jobs to make as much money as I can during the summer too. Working during college depends on how intense the curriculum will be, and the potential of work-study. Grades come first.
My parents will help me out, but I’m also planning to apply for scholarships—primarily ones that schools award based on ACT scores, G.P.A. and musical talent—and financial aid.
If a college is willing to give me aid, that will be very important when it comes to making my decision. A state school has a lower starting cost, but several of the private schools I’m applying to have expressed interest in offering competitive financial packages.
Dad’s Take My wife and I will cover as much as possible, but it’s important for Natalie to invest some of her own money into her education. I was responsible for my own college loans, and it will mean something to Natalie to do the same.
We see paying for school as a three-pronged approach: scholarships, our contribution and then whatever the gap is—which will have to come from her. We’re hoping to minimize the loans as much as possible, but we’re not going to co-sign for them because it’s important for Natalie to know she is responsible for this debt.
We’ve seen firsthand the devastating effects of parents saddled with their kids’ debt after the child defaults. We can help out with payments in the future, but it’s Natalie’s debt. That will also help establish her credit rating early.