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T. Rowe Price's 11th Annual Parents, Kids & Money Survey--College Savings Results

T. Rowe Price’s 2019 Parents, Kids & Money Survey found that many parents say college costs aren’t their responsibility, but most kids expect their parents to cover college costs.

T. Rowe Price's 11th Annual Parents, Kids & Money Survey--College Savings Results

  1. 1. 11TH ANNUAL PARENTS, KIDS & MONEY SURVEY—COLLEGE SAVINGS RESULTS Detailed Results
  2. 2. PARENT RESPONSES
  3. 3. 3 10% 53% 54% 62% None of the above Money saved for kids’ college education An emergency fund to cover unexpected expenses Money saved for retirement College Savings Q28. Which of the following do you have? (Check all that apply) T. Rowe Price 2019 Parents, Kids & Money Survey – Parent Survey N=1,005 (Total respondents) 47% 53% Saving for retirement Saving for kids' college education Q29. Which of the following is the higher priority for you and your family?
  4. 4. 4 College Savings – Accounts and Balances Q36. What types of accounts do you use for college savings? (Check all that apply) 11% 11% 14% 15% 16% 24% 26% 29% 29% 37% 44% Annuity or other insurance UGMA or UTMA account Roth IRA Traditional IRA Individual securities CD Savings bond 401(k) Checking account Regular savings account 529 account T. Rowe Price 2019 Parents, Kids & Money Survey – Parent Survey N=533 (Have college savings)
  5. 5. 5 Taking Money Out of College Savings Q37. How many times have you taken money out of your kids’ college savings in the past two years other than to pay education costs? 7% 18% 13% 63% Five times or more Two to four times Once Never T. Rowe Price 2019 Parents, Kids & Money Survey – Parent Survey N=533 (Have college savings)
  6. 6. 6 Accounts Used for College Savings Q38. What types of college savings accounts have you taken money out of in the past two years? (Check all that apply) 51% 55% 64% 65% 68% 69% 69% 70% 74% 78% 79% Annuity or other insurance Traditional IRA UGMA or UTMA account Individual securities CD 529 account Roth IRA Regular savings account Savings bond 401(k) Checking account T. Rowe Price 2019 Parents, Kids & Money Survey – Parent Survey N=200 (Have taken money out of college savings)
  7. 7. 7 Taking Money Out of College Savings Q39. Which of the following things have you paid for with money taken from your kids’ college savings in the past two years? (Check all that apply) 16% 19% 20% 21% 25% 25% 27% 27% 28% 29% 30% 32% 35% 35% Wedding Down payment on a home To cover expenses while unemployed Caring for an aging parent or relative Replenish emergency fund Vacation Home repair/renovation Day-to-day expenses Holiday spending Car purchase or repair Child care/day care To pay taxes Health care costs Pay off debt T. Rowe Price 2019 Parents, Kids & Money Survey – Parent Survey N=200 (Have taken money out of college savings)
  8. 8. 8 Paying for College Q40. Which of the following best describes how you feel about saving for your kids’ college education? 12% 25% 45% 19% Will be able to pay for ALL of the cost Will be able to pay for MOST of the cost Will be able to pay for SOME of the cost Will NOT be able to pay ANY of the cost Q41. How do you think you will cover the remaining cost for your kids’ college education? (Check all that apply) 3% 8% 10% 11% 11% 13% 13% 17% 21% 24% 27% 37% 37% 42% Other I haven't thought about it Sale of real estate Other family members Home equity loan or second mortgage Retirement accounts PLUS loan Personal loan or line of credit Credit cards Student loan in kids' names (parents to pay) Through regular income Student loan in kids' names (kids to pay) Kids will work Grants and/or scholarships T. Rowe Price 2019 Parents, Kids & Money Survey – Parent Survey N=1,005 (Total respondents) N=887
  9. 9. 9 College Debt Threshold Q42. How much debt are you willing to take on personally to provide your kids with a college education? Q43. How much debt are you willing to let your kids take on to get a college education? 4% 9% 12% 12% 17% 15% 16% 16% More than $150,000 $100,000 to $150,000 $75,000 to $99,999 $50,000 to $74,999 $25,000 to $49,999 $10,000 to $24,999 Less than $10,000 None 2% 7% 8% 12% 17% 18% 21% 20% More than $150,000 $100,000 to $150,000 $75,000 to $99,999 $50,000 to $74,999 $25,000 to $49,999 $10,000 to $24,999 Less than $10,000 None T. Rowe Price 2019 Parents, Kids & Money Survey – Parent Survey N=1,005 (Total respondents)
  10. 10. 10 Attitudes About Saving for College Q44. How much do you agree or disagree with each of the following statements? (Displaying percent that agree) 38% 42% 61% 68% 78% 80% 80% I lose sleep worrying about college costs It is not my responsibility to pay for my kids' college education I feel guilty that I won’t be able to pay more for my kids' college I’d be willing to delay my retirement to pay for my kids’ college education I would consider sending my kids to a less expensive college to avoid taking on student loans It’s hard to save for your kids’ college education when you’re still paying for your own I think nearly all students graduate from college with student loans T. Rowe Price 2019 Parents, Kids & Money Survey – Parent Survey N=1,005 (Total respondents)
  11. 11. 11 5% 7% 7% 8% 11% 5% 6% 51% $100,000 or more $75,000 to $99,999 $50,000 to $74,999 $25,000 to $49,999 $10,000 to $24,999 $5,000 to $9,999 Less than $5,000 No student loan debt Parent-Student Loan Debt Q20. What is the approximate balance (i.e., the amount you still owe) of your student loans (from you or your spouse/partner’s education combined)? T. Rowe Price 2019 Parents, Kids & Money Survey – Parent Survey N=1,005 (Total respondents)
  12. 12. 12 26% 2% 11% 19% 26% 30% 31% 7% 10% 12% 13% 14% 15% 17% 18% 20% Nothing Other To cover expenses while unemployed To pay taxes Car purchase or repair Health care costs Home repair/renovation Wedding Down payment on a home Child care/day care Kids' college education Caring for aging parent or relative Kids' primary education Holiday spending Vacation Pay off debt Using Retirement Savings and Emergency Fund Q31. What types of things have you used emergency fund money for in the past two years? (Check all that apply) Emergencies Nonemergencies T. Rowe Price 2019 Parents, Kids & Money Survey – Parent Survey N=545 (Have an emergency fund); N=265 (Have taken money out of retirement savings) 2% 15% 19% 21% 24% 26% 27% 11% 15% 17% 17% 21% 23% 23% 24% 28% 36% Other To cover expenses while unemployed Caring for an aging parent/relative Car purchase or repair To pay taxes Home repair/renovation Health care costs Wedding Replenish emergency fund Down payment on a home Day-to-day expenses Childcare/daycare Kids' primary education Holiday spending Kids' college education Vacation Pay off debt Q35. Which of the following things have you paid for with money taken from retirement savings in the past two years? (Check all that apply) Emergencies Nonemergencies
  13. 13. 13 23% 35% 21% 22% Strongly agree Somewhat agree Somewhat disagree Strongly disagree Paying for Better Schools Q50. How much do you agree or disagree with each of the following statement? I pay more in rent/mortgage because I wanted to live in an area that has better schools. T. Rowe Price 2019 Parents, Kids & Money Survey – Parent Survey N=1,005 (Total respondents) 58% Pay more for better schools
  14. 14. 14 20% 42% 30% 8% An extreme amount A considerable amount Not very much Not at all Paying for Better Schools Q51. How much has that impacted your ability to pay for other things, and/or save for retirement or your kids’ college? T. Rowe Price 2019 Parents, Kids & Money Survey – Parent Survey N=580 (Pay more for better schools)
  15. 15. 15 16% 20% 20% 26% 25% 26% 34% 44% 44% 25% 36% 38% 37% 42% 42% 51% 45% 45% Market volatility The value of long-term investing Planning for long-term goals like college Cybersecurity threats Maintaining a budget Setting financial goals How to earn money Spending wisely The importance of saving money Frequently Occasionally Frequency of Specific Financial Discussions Q58. How often do you discuss each of the following topics with your kid? (Four-point scale – displaying frequently or occasionally) T. Rowe Price 2019 Parents, Kids & Money Survey – Parent Survey N=1,005 (Total respondents)
  16. 16. 16 31% 32% 33% 33% 33% 34% 35% 36% 37% 38% 38% Politics Climate change Death Saving for retirement Debt Mental health Bullying Saving for college Drugs Sex School safety Uncomfortable Discussions Q60. How uncomfortable are you discussing each of the following with your kid? (Five-point scale – displaying very and extremely) T. Rowe Price 2019 Parents, Kids & Money Survey – Parent Survey N=1,005 (Total respondents)
  17. 17. 17 10% 5% 42% 43% 47% 48% 60% None of the above Other Discussing the cost of college Figuring out the amount of sales tax you pay Going into a physical bank Figuring out how much tip to leave at a restaurant Figuring out how much you get off on sales Teaching Moments Q61. Which of the following have you used as an opportunity to teach your kid about money? (Check all that apply) T. Rowe Price 2019 Parents, Kids & Money Survey – Parent Survey N=1,005 (Total respondents)
  18. 18. 18 38% 9% 12% 13% 15% 16% 16% 17% 18% 19% 24% 24% I have not argued with my spouse/partner Gambling losses Money lost on poor investments Unexpected charge on credit card Worry about losing a job or not finding a job Dipping into a savings Taxes too high Kids costing too much money Paying for college Not sticking to a budget/overspending Spoiling the kids Amount of debt owed Arguing About Finances Q62. In the past six months, have you and your spouse/partner argued about any of the following financial topics when your kid was home? (Check all that apply) T. Rowe Price 2019 Parents, Kids & Money Survey – Parent Survey N=1,005 (Total respondents)
  19. 19. KIDS’ RESPONSES
  20. 20. 20 37% 63% Their retirement My college education Family Saving Priority QK7. Do you think it is more important for your parents to save for their retirement or your college education? T. Rowe Price 2019 Parents, Kids & Money Survey – Parent Survey N=1,005 (Total respondents)
  21. 21. 21 15% 19% 19% 22% 21% 24% 33% 42% 46% 23% 30% 36% 36% 38% 38% 47% 44% 41% Market volatility The value of long-term investing Planning for long-term goals like college Cybersecurity threats Setting financial goals Maintaining a budget How to earn money The importance of saving money Spending wisely Frequently Occasionally Frequency of Specific Financial Discussions QK10. How often does your parent discuss each of the following topics with you? (Four-point scale – displaying frequently or occasionally) T. Rowe Price 2019 Parents, Kids & Money Survey – Kid Survey N=1,005 (Total respondents)
  22. 22. 22 17% 23% 39% 21% 27% 26% 31% 16% Never Rarely Occasionally Frequently Girls Boys Frequency of Specific Financial Discussions QK10. How often does your parent discuss each of the following topics with you? Planning for long-term goals like college T. Rowe Price 2019 Parents, Kids & Money Survey – Kid Survey N=1,005 (Total respondents)
  23. 23. 23 33% 8% 9% 12% 13% 14% 15% 16% 20% 20% 21% 23% I have not heard my parents talking about any of these things Gambling losses Money lost on poor investments Dipping into a savings Unexpected charge on credit card Kids costing too much money Worry about losing a job or not finding a job Not sticking to a budget/overspending Taxes too high Spoiling the kids Amount of debt owed Paying for college Parents Arguing About Finances QK17. In the past six months, have you heard your parent(s) talking about any of these topics, when they thought you were not listening? (Check all that apply) T. Rowe Price 2019 Parents, Kids & Money Survey – Kid Survey N=1,005 (Total respondents)
  24. 24. 24 54% 69% I don't need to worry about saving for something like college that is so far away It is my parent's responsibility to pay for my college education Kid Attitudes and Behaviors QK18. How much do you agree or disagree with the following statements? (Displaying percent that agree) T. Rowe Price 2019 Parents, Kids & Money Survey – Parent Survey N=1,005 (Total respondents)
  25. 25. RESPONDENT PROFILE
  26. 26. 26 49%51% Respondent Profile - Parents 33% 21% 25% 20% South Midwest West Northeast Q2. RegionQ1. Age Q3. Gender Men Women Q5. Household Income 86% 7% 6% 1% Married Separated/Divorced Single Widow/Widower Q4. Marital Status 22% 43% 30% 5% <35 35–44 45-54 55+ 18% 45% 24% 13% <$50K $50K–$99,999 $100K-$149,999 $150K+ 82% 7% 7% 7% 1% White/Caucasian Hispanic/Latino Black/African American Asian Native American Q6. Race/Ethnicity (Check all that apply) T. Rowe Price 2019 Parents, Kids & Money Survey – Parent Survey N=1,005 (Total respondents)
  27. 27. 27 Respondent Profile - Parents Q7. Education Level 72% 12% 8% 4% 2% 3% 1% Employed full time Stay-at-home parent Employed part time Self-employed Unemployed Retired Student Q8. Employment Status (Check all that apply) 1% 18% 15% 11% 35% 20% < HS graduate HS graduate Some college Assoc. degree Bachelor's degree Graduate degree 31% 50% 12% 6% 1 2 3 4+ Q11. # Kids in Household T. Rowe Price 2019 Parents, Kids & Money Survey – Parent Survey N=1,005 (Total respondents)
  28. 28. 28 Respondent Profile - Kids 59% 41% Q13. Kid gender BoysGirls Q13. Kid age 10% 12% 16% 13% 16% 18% 15% 8 9 10 11 12 13 14 T. Rowe Price 2019 Parents, Kids & Money Survey – Parent Survey N=1,005 (Total respondents)
  29. 29. OBJECTIVE AND METHODOLOGY
  30. 30. 30 Objective and Methodology Objective  To understand the basic financial knowledge, attitudes, and behaviors of both parents of children ages 8-14 and their children ages of 8-14. Methodology  T. Rowe Price commissioned an online survey of parents of children ages 8-14 and their children ages 8-14.  The survey was fielded from January 17, 2019, through January 23, 2019, with quotas of approximately 50% men and 50% women.  A total of 1,005 parents of children ages 8-14 in the U.S. participated; the sampling error for samples of 1,005 is +/- 3.1% at the 95% confidence interval.  The survey was fielded through Research Now. T. Rowe Price 2019 Parents, Kids & Money Survey T. Rowe Price Group, Inc. 201908-915183

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