As the fall semester grows closer, it is becoming clear that the traditional college experience will be altered due to the pandemic. Virtual versus in-person learning, limited social activities, and potentially small clusters of students living and taking classes together is becoming the reality, and the uncertainty has left many parents wondering if the tuition will be worth the cost.
In a recent UBS report, “Setting a New Course – US Investors Rethink Health and Wealth in a Post-COVID World,” 92% of respondents reported staying healthy is a priority and 81% said they want to protect their family more, given the pandemic. Additionally, about half of US families say the pandemic has changed their college plans, and many parents indicate they are uncertain about fall enrollment in a continued distance-learning scenario.
What considerations should parents and students assess in making important decisions about higher education during the pandemic? What are the positive and negative social and academic considerations for taking a gap year? If the decision is purely a financial one, then it may be appropriate for the parents to make it on their own, but if finances are not the major concern, then all these key factors should be discussed with their students.
There are three important aspects that parents and students should take into account when assessing whether to attend college in the fall.
Whether we like it or not, money is often the top concern in many decisions we make, especially when it comes to college. In the same UBS report, 48% of respondents said the pandemic has somewhat impacted them financially, and 22% say it has significantly impacted them. What’s more, 44% worry about not having enough liquidity if there is another wave of infections.
Here’s what to consider about college from a financial perspective:
- If the goal of a college education is to prepare the student for future financial success, then taking a year off will delay earnings and result in saving less money between graduation and retirement.
- If the student takes that gap year, how will the loss of future earnings impact the family?
- How might taking a gap year affect the student’s attitude toward financial preparedness and independence? For some students, the pandemic may make them more serious savers when they actually do start working.
Every parent wants his or her child to have the best chance of success. When it comes to the educational impact of going to college versus taking a gap year, parents should discuss the following with their students:
- To comply with social distancing, many courses will be held online, while in-person classes will shrink in size. According to a recent Tyton Partners survey, many parents believe remote learning will not be as “high quality” as face-to-face. Ask your children about their comfort level with remote learning and be sure to tell them your concerns.
- Parents should consider whether their student is responsible and self-motivated enough to comply with the remote-learning requirements and gain knowledge despite the less-than-ideal learning situation.
- Both parents and students should discuss their perceptions of how they expect the college experience will unfold. Do either parents or students have specific concerns–such as the hastiness of transition, worries about unprepared instructors, or low engagement—and how might they learn more about these aspects to address them?
- Families that are concerned about remote learning might also look at colleges that had distance-learning programs in place before the pandemic. This will help them identify schools that may be better able to adapt to changing circumstances, or better understand how their student’s current school may operate.
For many parents, some of the best memories and learning experiences from college are not about the academics but about being “out on your own” and interacting with others. With social distancing and new guidelines, this year already looks like it will be different socially in many regards. Parents should consider:
- What price do I put on the social aspects of college? How important is this to my child?
- Because interactions will be limited, some are considering delaying college in the hopes that things will be back to normal next year. There is a risk, however, as we can’t know whether a year is enough. College may never go back to “normal.”
- On one hand, incoming students may never get the college experience they’ve been dreaming of. On the other, college students will always find a way to have fun, and the new version of college may offer even greater value, especially if it comes with a greater focus on education and career preparation, as opposed to “frills.”
Should they stay or should they go? The decision to send children to college in the fall or encourage them to take a gap year is not an easy one, and one that must be weighed by each family. Parents and children need to have important conversations and weight key aspects about what this year will likely hold. Consider talking with your financial advisor for more information on addressing the costs and other important aspects of college.
Kimberly Guha is a financial advisor at UBS Wealth Management USA in San Diego.