Is education still a worthwhile investment? According to How America Saves for College 2014, 89% of parents believe it is. And parents are putting their savings where their mouths beliefs are, with 80% of parents stating they are willing to stretch financially to save for college.
How America Saves for College 2014 was a survey designed by Ipsos and Sallie Mae. Ipsos surveyed a nationally representative survey of more than 2,000 parents of children under age 18. This is the third time that the Sallie Mae report has been released, and each year’s data can be very helpful to understanding national trends in college savings, savings vehicles and plans vs reality.
Here are a few of the key statistics:
- The proportion of families saving for college declined during the recession from 62% in 2009 to 50% in 2013. In 2014, saving for college is on the rebound.
- The total average savings for higher education is $15,346, up from $11,781 last year.
- Families typically use two or more vehicles to save for college and are most likely to save for college in general savings accounts (45%), 529 College Savings Plans (29%) or a checking account (27%). 18% are supplementing their savings with a rewards program.
- Nearly half of parents saving for college have set a goal for the amount they want to save. However, they are slightly more likely to base their goal on what they can afford (28% of savers) rather than how much money will be needed (24%).
- Saving for college is a top priority for families, second only to retirement.
- Planners (41% of parents) are more successful savers. Parents with a plan have saved 83% more in their college-savings fund ($18,518) than savers who don’t have a plan ($10,105).