Nearly Half of Students Say Cost is “Most Important” When Choosing Where and How to Pursue Higher Education
More Students Considering Vocational and Trade Schools as Families Prioritize Practical Factors in College Decisions
Parents Who are Saving in a Dedicated College Account Feel Positive About Their Ability to Finance Their Child’s Education
BOSTON, August 14, 2025 — As families navigate an evolving economic landscape, Fidelity Investments’® 2025 College Savings & Student Debt Study reveals high school students are redefining what success looks like after graduation, by prioritizing affordability, career readiness, and long-term financial security. More than half of high school students say living through recent times of economic uncertainty shaped how they view the role of higher education, which may be driving a surge of interest in non-traditional paths and a sharper focus on return on investment when it comes to pursuing post-high school education.
“In the face of continued economic uncertainty, high school students and their parents are making more intentional, informed decisions about higher education,” said Tony Durkan, vice president, head of 529 college savings at Fidelity Investments. “Whether it’s prioritizing a stable career or staying the course on their savings, families are taking practical steps to build a strong foundation for the future.”
Students Continue to Prioritize Cost and Career Prospects
One increasingly important consideration is the cost of college, which 47% of college-bound students identify as “most important” when choosing where or how to pursue higher education, up from 40% in 2021. This percentage is even higher among college-bound high school seniors (54%). Overall students’ top goals in pursuing higher education are similarly shifting toward the practical:
- Getting a job in a field they’re interested in/passionate about (65%)
- Getting a job that pays enough to support them and their long-term goals (61%)
- Setting themselves up for a solid/stable career (61%)
While these top goals have largely stayed the same since 2021, the percentages of students prioritizing these factors have increased across the board – up from 55%, 53%, and 51%, respectively.
Students are also increasingly considering paths beyond a traditional four-year degree. While just 6% of students say they’re most likely to consider vocational or trade school after high school, that percentage has tripled since 2021.
Parents Staying the Course on Saving, but Not Without Concerns
Students aren’t the only ones who have been impacted by the economic decisions surrounding post-high school education, as 60% of parents say they’re concerned about market uncertainty impacting their ability to finance their child’s college education. Encouragingly, nearly three quarters of parents say they are staying the course when it comes to saving for college. Among those who have made changes in response to recent market uncertainty, the top actions taken involve reducing the amount they’re saving (45%), rebalancing or reallocating investments to manage risk (31%), and starting to use other savings methods in addition to a 529 (29%).
As parents continue to navigate market uncertainty, saving in a tax-advantaged account like a 529 plan could help them maximize their efforts and feel more confident in their ability to support their child’s educational journey. In fact, parents who plan to finance their child’s higher education with a dedicated college savings account report feeling positive:
- 69% feel grateful to have saved some money toward college
- 56% feel optimistic their child will be able to pursue higher education thanks to the savings
- 54% feel accomplished to have set a savings goal and partially or fully met it
529 accounts can be used for a wide variety of education expenses, including college expenses, tuition for K-12 schools (up to $10,000), certain apprenticeship costs, and student loan repayments (up to $10,000), making them a helpful option regardless of a child’s plans for higher education.1
Parents and Students are Talking Costs, but Student Debt Knowledge Gaps Exist
College-bound students and their parents are fairly aligned when it comes to how much they expect their family to owe in total debt after graduation. Students anticipate graduating with about $17,000 in loans on average; for parents, the average is about $16,000.
58% of students and 54% of parents say they used their own best guess to come up with those estimates. And while those percentages have both dropped considerably since 2021 – down from 71% and 63%, respectively – there’s still a potential gap in families’ knowledge of what their debt burden will look like after graduation. With the cost of a single year at an in-state four-year public university averaging $24,920 for the 2024-2025 academic year2, families who plan to cover half the cost of college with loans could actually graduate with nearly $50,000 in debt.
Encouragingly, 67% of students and 70% of parents say they’ve discussed how they’ll finance their higher education. These discussions mark a critical step toward financial preparedness, helping students and their parents align on realistic expectations and strategies for managing the cost of college. With recent legislative changes to repayment and loan forgiveness plans, it’s more important now than ever for families to have a clear view of what they’ll owe after graduation.
Need assistance in your college planning? Fidelity can help.
- Call us at 1-800-544-1914 for complimentary access to dedicated college planning representatives
- Get our Viewpoints on college planning and learn more about how the new tax act might change how families save, spend, and plan for their children
- Access our College Savings Resource Center at www.fidelity.com/saving-for-college/overview
- Find tools and resources to understand the true cost of student loan debt at Fidelity.com/StudentDebtHelp
- Ask friends and family to contribute to your child’s college savings fund at www.fidelity.com/529-plans/college-gifting
- Locate a Fidelity Investor Center near you at www.fidelity.com/branchlocator/
About Fidelity’s 2025 College Savings & Student Debt Study
This study presents findings of an online survey among a sample of 2,008 respondents who are 15 years of age or older and either a current high school student in grades 10-12 (N=1,003) or a parent of a current high school student in grades 10-12 (N=1,005). Fielding for this survey was completed between May 22-June 4, 2025, by Big Village, which is not affiliated with Fidelity Investments.
About Fidelity Investments
Fidelity’s mission is to strengthen the financial well-being of our customers and deliver better outcomes for the clients and businesses we serve. Fidelity’s strength comes from the scale of our diversified, market-leading financial services businesses that serve individuals, families, employers, wealth management firms, and institutions. With assets under administration of $16.4 trillion, including discretionary assets of $6.4 trillion as of June 30, 2025, we focus on meeting the unique needs of a broad and growing customer base. Privately held for 79 years, Fidelity employs more than 78,000 associates across the United States, Ireland, and India. For more information about Fidelity Investments, visit https://www.fidelity.com/about-fidelity/our-company.
Please carefully consider the plan's investment objectives, risks, charges, and expenses before investing. For this and other information on any 529 college savings plan managed by Fidelity, contact Fidelity for a free Fact Kit, or view one online. Read it carefully before you invest or send money.
**Units of the portfolios are municipal securities and may be subject to market volatility and fluctuation.**
Keep in mind that investing involves risk. The value of your investment will fluctuate over time, and you may gain or lose money.
Views expressed are as of the date indicated, based on the information available at that time, and may change based on market or other conditions. Unless otherwise noted, the opinions provided are those of the speaker or author and not necessarily those of Fidelity Investments or its affiliates. Fidelity does not assume any duty to update any of the information.
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1 529 distributions for qualified education expenses are generally federal income tax free. 529 assets may be used to pay for (i) qualified higher education expenses, (ii) qualified expenses for registered apprenticeship programs, (iii) up to $10,000 per taxable year per beneficiary for tuition expenses in connection with enrollment at a public, private, or religious elementary or secondary educational institution. Although such assets may come from multiple 529 accounts, the $10,000 qualified withdrawal limit will be aggregated on a per beneficiary basis. The IRS has not provided guidance to date on the methodology of allocating the $10,000 annual maximum among withdrawals from different 529 accounts, and (iv) amounts paid as principal or interest on any qualified education loan of a 529 plan designated beneficiary or a sibling of the designated beneficiary. The amount treated as a qualified expense is subject to a lifetime limit of $10,000 per individual. Although the assets may come from multiple 529 accounts, the $10,000 withdrawal limit for qualified educational loans payments will be aggregated on a per individual basis. The IRS has not provided guidance to date on the methodology of allocating the $10,000 annual maximum among withdrawals from different 529 accounts. Any earnings on distributions not used for qualified higher educational expenses or that exceed distribution limits may be taxed as ordinary income and may be subject to a 10% federal tax penalty. Some states do not conform with federal tax law. Please check with your home state to determine if it recognizes the expanded 529 benefits afforded under federal tax law, including distributions for elementary and secondary education expenses, apprenticeship programs, and student loan repayments. You may want to consult with a tax professional before investing or making distributions.
2College Board Trends in College Pricing Report, October 2024. Figure includes tuition, fees, and room and board.