[Should parents pay for their children's college education?]
4. Watch kids' student loan borrowing habits: "Often, students living at home borrow more in student loans than needed to pay for educational expenses," Ellis says. Therefore, it's important for parents to help their kids budget for college expenses.
For example, a student gets a $2,000 student loan refund check after tuition and fees are deducted. Textbooks cost $400; with $1,600 left, the student then buys music downloads and extra clothing, and goes out with friends. After four semesters, the student owes $6,400 that he or she didn't need to borrow. Interest may also accrue.
Parents should talk to their kids about taking out fewer student loans, Ellis says. If students are swallowed by debt when they graduate, this ultimately defeats the purpose of parents saving for college.
Reyna Gobel, frequently quoted as an expert on student loans and college costs, is the author of "Graduation Debt: How To Manage Student Loans And Live Your Life" and "How Smart Students Pay for School: The Best Way to Save for College, Get the Right Loans, and Repay Debt." She has appeared on PBS's Nightly Business Report and speaks regularly at CollegeWeekLive.