Should You Pay For Your Child’s College Education?


I would love to see a longitudinal study that answers this question: “Should parents pay for ALL of their children’s college education?”

If I had to bet every jar of spirulina in my cupboard, I would say they shouldn’t.

Parents shouldn’t pay for ALL of their children’s college education–even if they’re rich.

What do you think?

Image by Pixabay

Here’s why I think they shouldn’t.

Andrew Hallam

I’m a financial columnist for Canada’s national paper, The Globe and Mail, as well as for AssetBuilder, a financial service firm based in Texas. I’m also the author of Millionaire Teacher: The Nine Rules of Wealth You Should Have Learned in School (2nd Ed. Wiley 2017) and The Global Expatriate’s Guide To Investing: From Millionaire Teacher to Millionaire Expat (Wiley 2015). My mission is to educate, motivate and inspire people on basic retirement planning and best practices for investing, using evidence-based strategies. I'm happy to comment on your questions. However, please read the Terms of Use, Privacy Policy and the Comments Policy.

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9 Responses

  1. Sonia says:

    Parents should provide the best conducive environment for the kids to learn as much as they can. If parents can afford, they should pay for up to the doctor’s degree. There are so many obstacles in getting higher education, money, if the parents can afford it, shouldn’t be one. There are other ways to teach kids money management and be frugal, please don’t do this at the cost of their education.

  2. toony says:

    Doing bar work every weekend to put myself through university really taught me the value of money and being fiscally responsible (instead of simply having my fees paid for)!

    It also taught me many valuable life lessons that money simply can’t buy!

    Have vowed to make any children I have to work for it as well!

  3. Finally Financially Independent says:

    In your Asset Builder article you mention that research has shown that the more money that parents paid on their children’s education the lower their academic performance and you suggested that half might be the sweet spot.

    We wrestled with what we were going to do. When my siblings and I went to university my parents were able to provide free room and board for as long as we were in full time post secondary studies but we raised our family in a rural area so commuting wasn’t an option for our sons. In the end what we did was to give them the EAPs (government grants and growth) from their RESPs (we reclaimed the contributions) and when they completed their degrees they had access to their “family allowance” accounts. It worked out that we paid less than half of their costs and they both earned A+ marks in every course in every year.

    It is probably too soon to judge how our strategy has affected their financial acumen but they both paid off their student loans before they graduated and within two years of earning their degrees they amassed almost enough savings to max out their TFSAs (in a low cost portfolio of diversified index funds). One graduated into a six figure job and the other is pursuing a PhD, but he’ll be able to invest more than half of his tax free $39000/ year (plus free tuition) scholarship. I will admit that one is a bit of a workaholic but the other reminds me a lot of Andrew. (His undergrad adventures in Eastern Europe, Central America and Asia didn’t get in the way of paying off his student loan.) In fact he is the one person that I wouldn’t want to read Andrew’s books for fear that he’d combine his own frugal habits with some of Andrew’s early experiments in no cost/low cost living!

  4. Avinash More says:

    Hi Andrew,
    I would disagree so to why not fully but responsibly pay for the child’s education. I am not advocating that parents should be irresponsible but there is nothing wrong in giving one’s child a good start in life.
    I would welcome your comments please.

  5. Daniel T says:

    Working at a restaurant kitchen was great motivation for me to finish school because no way did I want to be doing that as a career. My step-brother had his education paid for and just joined a fraternity and partied away that education opportunity. . he got serious much later. . but the money was already wasted.

    Also I noticed when I lived in China that NO students work. The main reason is that they have too much competition and have to spend all free time studying. . however they developed a shocking lack of respect and sympathy for the “working man”. They’d be rude with staff at restaurants and shops because they never had the experience of doing such work themselves. . unlike western students who do all these sorts of jobs.

  6. Linda Kardamis says:

    I am so glad my parents couldn’t afford to pay for college. Both my husband and I had to pay for our own college and it has made us so much more responsible financially. I have friends whose parents paid for their college who struggled for years afterwards because they had not had any practice managing their own money.

    I’ve thought about this a lot for my own kids and I personally think a big key is who has the responsibility. I want it to be my kids’ responsibility to pay for college – and if we’re able, we will help them with a percentage or a fixed amount. But giving them the responsibility changes everything – as opposed to making it our responsibility to provide it for them – or asking them to “help us” pay for it.

  7. Bindu says:

    Hi Andrew,

    Interesting article. My parents supported me through college (though I did receive a 1/2 tuition merit based scholarship) and I am still grateful to them for their support. Growing up, my parents always expected us to try and get scholarships to pay for our college and it was made pretty clear to me that if my parents were going to pay for my schooling, I better be able to be financially independent from my undergraduate degree so I didn’t waste that money and time on an education that wouldn’t be able to support myself. At the same time, though I had a full scholarship at one school, I chose to attend a more expensive private institution that would have required me to take out loans if my parents had not provided financial assistance. However, I now have 3 very young kids and I would really like them to learn about investing at a young age (something my parents did not teach me about at all or do on my behalf). They were of the mindset that they took care of everything financially so that we could focus on our education (I had plenty of chores but I did not receive any allowance). Now I am at a loss among the many ideas of how to teach kids about how to manage money responsibly (my spouse and I started reading up on it after about 6 months of marriage and 2 large grad school bills). Do you have any advice other than making kids earn money that they invest? I would like my kids to have the advantage of having years of compounding interest along with the value of hard work but implementation is where I am struggling. It would be easier for me to put $50 ($5/$10/15?)/mo in an investment account on their behalf even though that is the wrong move for teaching them how to be financially independent because I can’t figure out a good mechanism.

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