RIVERWOODS, Ill.--(BUSINESS WIRE)--Parents are now more concerned about how they’ll pay for their child’s college education than before the COVID-19 pandemic outbreak, according to a national survey from Discover Student Loans. The survey found 68% of U.S. parents of college-bound students now report at least some concern about paying for their child’s education. The survey polled parents with college-bound teens in early March and again in May.
Despite these changes, 67% of parents still believe college is a good investment for their children.
“Families are looking beyond the current challenges presented by COVID-19 and understand the long-term value of higher education,” said Manny Chagas, vice president of Discover Student Loans. “Given the uncertain circumstances, it’s important for families to be prepared when the time comes to make a decision by discussing all of their options for higher education and available financing alternatives.
Families are taking a collaborative approach to adjust college plans and talking more openly about financing college
More than half of parents say they’ve begun to talk more candidly with their children about paying for college compared to before COVID-19, according to the survey. Many parents (53%) say their child’s education plans have also changed as a result of COVID-19. They say their child is now exploring other options such as: attending a school closer to home (7%), delaying going to college (6%), or going to a less expensive school (6%).
More families look to scholarships, grants, and savings to fill gaps in college financing
Fifty-five percent of parents are concerned their child is not receiving enough in scholarships – a 14% jump from the first survey in early March. Similarly, 53% of parents are concerned their child is not receiving enough financial aid – up 9% from pre-pandemic.
Parents are also planning to use their savings more than they have in recent years. In fact, 54% of parents report they now plan to use their savings to pay for their child’s college education, compared to just 47% prior to the pandemic. According to Discover’s survey, student loans continue to be the third-most cited financing option to help families pay for college.
“The transition to college is a big step for families. It’s encouraging to see that students and parents are talking openly about financing college and looking for ways to manage this process together,” Chagas said. “By leveraging a variety of financing solutions, such as scholarships, grants and then considering student loans, families can preserve their savings while still covering their children’s college expenses.
All figures, unless otherwise stated, are from two Dynata (formerly Research Now/SSI) surveys conducted on behalf of Discover Financial Services. The surveys were conducted online; the first one was fielded from March 9 – 19, 2020, with a total sample size of 1,500 U.S. parents of college bound students (ages 16 – 18), and the second survey was fielded from May 2 – 4, 2020, with a total sample size of 1,500 U.S. parents of college bound students (ages 16-18). The margin of sampling error for both surveys is ±2.53 percentage points with a 95 percent level of confidence.
Discover Financial Services (NYSE: DFS) is a digital banking and payment services company with one of the most recognized brands in U.S. financial services. Since its inception in 1986, the company has become one of the largest card issuers in the United States. The company issues the Discover card, America's cash rewards pioneer, and offers private student loans, personal loans, home loans, checking and savings accounts and certificates of deposit through its banking business. It operates the Discover Global Network comprised of Discover Network, with millions of merchant and cash access locations; PULSE, one of the nation's leading ATM/debit networks; and Diners Club International, a global payments network with acceptance around the world. For more information, visit www.discover.com/company.