Though nine out of 10 parents believe funding their child’s education to be a worthy investment, more parents are using traditional savings accounts over 529 college savings plans, reported Student Loan Hero.
Student Loan Hero is an online student loan aggregator platform for individuals looking for methods to manage and eliminate college debt. In January, the company surveyed over 1,000 men and women saving for their children’s educational expenses and found that not only are many parents are not using 529s, they may feel guilty about not saving enough money for their child’s college.
The survey revealed parent sentiment around saving for their child’s education. Seventy-four percent of parents are using a savings account and within that group three out of four parents are using a traditional savings account while 1 out of 4 have turned to a 529. The report hinted that the figures reflect parents’ unawareness or misapprehension of 529 plans.
Though parents are seeking various methods of saving for their child’s educational expense, a majority of parents from the study feel good about their college saving efforts. Student Loan Hero reported that although 48 percent are feeling good, there were a significant amount (44 percent) of parents feeling guilty that they aren’t saving enough.
The survey discovered how parents planned to make up for what they felt they couldn’t save. Thirty-seven percent of parents said they’ve thought about borrowing from their retirement savings, but 18 percent responded they weren’t sure if they should pull from their retirement accounts. Respondents also considered private loans and federal aid.
Despite respondents considering dipping into their retirement accounts, 44 percent feel their retirement savings should come before their child’s educational expenses.
To view the full report, click here.