A degree can be paid for by scholarships, loans, work and a cheaper destination. The years after you stop earning can only be paid for by you.

Few money decisions carry as much feeling as paying for a child’s education. For many families, especially those weighing a degree abroad, it is the single largest goal they will fund, and it lands in the decade when their own savings should be compounding hardest. This article sets out what parents actually pay, what the published fees say about studying abroad against studying at home, the argument for putting your own independence first, and how to test the trade-off on your own figures rather than in the abstract.

What parents actually pay

The most detailed picture comes from the United States. Sallie Mae’s nineteenth How America Pays for College study, which surveyed 1,000 students and 1,000 parents in April and May 2026, found families spent an average of $34,019 on college in 2025–26, 10% more than the year before¹. Parents’ own income and savings covered the largest share, 39%, and parent borrowing another 11%; scholarships paid for 15%, grants 12%, student borrowing 11% and the student’s own income and savings 10%¹. Put together, half the bill fell on parents and the other half was met by everyone and everything else.

Outside the US the evidence is older but points the same way. HSBC’s Value of Education study, run by Ipsos MORI among 8,481 parents in 15 countries and territories in 2017, put the average spent on a child’s education from primary school to a first degree at about USD 44,221, ranging from about USD 132,161 in Hong Kong to about USD 16,708 in France, with India at about USD 18,909². Most parents paid from day-to-day income (74%), with 36% drawing on general savings, investments or insurance and only 21% using a dedicated education plan². And the sacrifices were real: 40% had cut their own leisure spending, 21% worked extra hours and 20% had paid less into their own long-term savings or investments to cover it².

The oxygen-mask argument

Airline safety briefings tell parents to fit their own oxygen mask before helping a child, because a parent who passes out helps nobody. Financial-planning writers borrow the image for this exact choice. The reasoning is structural rather than selfish: a degree can be paid for in several ways, and the years after you stop earning can be paid for in only one.

Vanguard’s own guidance on juggling family goals ranks saving for later life ahead of saving for college for that reason³. Most parents feel the opposite: in T. Rowe Price’s 2018 Parents, Kids & Money survey, 74% of US parents said saving for their children’s college was a higher priority than saving for their own retirement⁴. Both positions are defensible, and the gap between them is why the decision deserves arithmetic rather than instinct.

• For putting your own savings first: money set aside in your thirties and forties has the longest time to compound; a shortfall later in life cannot be borrowed against; and parents who run short often become a financial responsibility for the same children they paid to educate — the sandwich the next generation then inherits.
• For putting the education first: the window is fixed and short, a strong education can change a child’s whole earning life, and in many families supporting a degree is part of an understood exchange across generations rather than a one-way gift.
• What both sides agree on: the worst outcome is deciding without numbers — promising a destination before knowing what it costs, or quietly stopping your own saving without seeing what that does to the age you could stop working.

Study abroad against study at home: the published fees

The choice of where to study often moves the cost more than any savings or investment decision a family can make. The fees below come from governments, statistics offices and universities themselves, and they show why: the same degree can cost several times as much depending on where it is taken and whether the student counts as a local.

Two multiples stand out. An international undergraduate in Canada pays on average more than five times what a Canadian does — C$41,746 against C$7,734 a year⁶. In the United States, an out-of-state student at a public university pays about 2.7 times the in-state rate, $31,880 against $11,950⁵. At the other end, Germany’s state universities generally charge no tuition for most courses, and even the non-EU fee in Baden-Württemberg is €1,500 a semester⁸; living costs, for which a visa applicant must show €11,904 a year, become the main bill⁸.

For families in Asia, HSBC’s 2024 Quality of Life research put the cost of a three- or four-year degree in the US, UK, Australia or Canada at USD 192,000–256,000 per child, and estimated it could consume up to 66% of parents’ retirement savings in India and Indonesia and up to 30% in Singapore¹⁰. Demand is not slowing: UNESCO counts about 6.9 million students studying outside their home country, three times the number in 2000¹¹, and India sent about 508,000 abroad in 2021, second only to China¹². In HSBC’s 2017 survey, 55% of Indian parents said they would consider sending a child to university abroad².

The trade-offs, named plainly

Paying in full from parents’ savings is only one of five levers, and each of the others has a cost that lands on somebody.

• A loan in the student’s name. It moves the cost to the person who benefits from the degree, and some systems tie repayment to income. England’s Plan 5 loans take 9% of income above £25,000 a year and write off what is left after 40 years¹³. The trade-off is a deduction that may run for much of a working life — weigh it with the companion piece on student debt systems.
• A loan in the parents’ name. Usually dearer: US federal Direct Loans to undergraduates carried 6.39% for 2025–26, while PLUS loans to parents carried 8.94%¹⁴. It also puts debt on the balance sheet that should be shrinking as you approach the years you stop earning.
• Scholarships and grants. In the Sallie Mae data they covered 27% of the average bill between them¹ — real money, but rarely known until after the decision to apply abroad has been made.
• The student’s own work. Covered 10% of the US bill¹; abroad it is capped by visa rules and competes with study time.
• A less costly place to study. Germany, a home-country university, or a first degree at home and a master’s abroad can cut the total by more than any investment return — and whether the expensive option pays for itself is a separate question, taken up in is a degree worth it.

How to test it on your own plan

1. Price each option in today’s money. A degree at home, a degree abroad, and a mixed route — tuition plus living costs, from the universities’ own fee pages.
2. Date it from your child’s age. Higher education usually starts around eighteen; Nivritee suggests an education goal dated from each child’s age, with the year filled in and the cost left for you.
3. Enter the cost in the currency it is charged in. A life goal’s cost can be typed in pounds, dollars or euros and is converted into your plan’s reporting currency; it rises each year at your plan’s education inflation rate, which you can change.
4. Read what moved. Compare the projected independence age and the verdict with and without the goal. A goal that pushes the age back by a year or two is a decision; one that turns the verdict from Workable to Short is a warning.
5. Run the stress tests. A career break, a job loss or a stretch of high inflation lands differently when a large goal sits in the same decade.
6. Look at the levers. Under “What would move this” the Overview prices saving a little more, living on a little less later, or clearing your costliest loan in years — see what the levers are.

Do it as a couple. Two parents often hold different assumptions about who is paying for what, and an education goal is exactly the kind of figure one partner knows and the other guesses. A shared plan, where each of you can see the goal and its effect on both your independence ages, turns an argument about values into a conversation about numbers — the approach set out in how couples can talk about money.