Whether you want to enroll in your child or yourself in your dream school or simply want to pursue higher education, calculating college costs can be quite a tricky task.
In the first chapter of our saving 4 college series, we take you through the process of estimating college expenses. With a college tuition calculator, you may also determine if you can easily afford the costs related to your goals or if you’re going to need to get creative.
To help you figure out your options for college, keep reading this guide or use the links below.
- What is the Cost of Attending College?
- What’s In Your Budget?
- What Are Funding Options?
- What Do You Need to Pay Post-Graduation?
- How Can You Calculate the Total Cost?
What is the Cost of Attending College?
The average cost of attending college depends upon various factors. These include but are not limited to the
- State where you go to college
- Type of institution that you choose to attend
- Scholarships and grants that you may have at hand
You also need to consider that college costs have increased quite significantly from where they were a few decades ago: The average cost of college has more-than doubled in the 21st century, with an annual growth rate of 6.8%1.
While making price estimates and calculations for college, being aware of these factors helps you steer clear of surprises. In turn, you can start saving for college with more confidence. You can also learn about ideal saving options in Chapter 8 of this series.
Sticker Price vs. Net Price
When calculating your costs of college, you may see college prices listed under two categories.
- Sticker Price
- Net Price
Sticker Price
The sticker price refers to a college’s publicly advertised cost of attendance for a single year. The cost of attendance includes:
- Tuition
- Books
- Room and board
The sticker price gives you a general idea of how much a specific school may cost.
Net Price
The net price is the cost of attendance that is determined after deducting your scholarships and grants from a college’s publicly listed charges. This price is specific to each student and remains a key factor in helping you find out your college costs for each year.
Keeping this in mind, you may want to pay more attention to the net price instead of the sticker price while calculating your college costs. This lets you factor in all the tuition fees and living expenses for your time at college.
Average Cost Estimates
The following figures provide you with estimates on the average college costs for undergraduate full-time students of 4-year institutions. These costs are outlined for a single year.
For Students Living With Family
In the academic year 2019-20, the average total cost of attendance for students living with family stood at the following amounts.
- Public Institutions: $14,900
- Private For-Profit Institutions: $24,700
- Private Nonprofit Institutions: $42,200
For Students Living Off-Campus by Themselves
In 2019–2020, students living off-campus by themselves faced the following average total cost of attendance.
- Public Institutions: $25,600
- Private For-Profit Institutions: $34,000
- Private Nonprofit Institutions: $53,900
For Students Living On-Campus
In 2019–2020, students living on-campus reported the following average total cost of attendance.
- Public Institutions: $25,500
- Private For-Profit Institutions: $35,100
- Private Nonprofit Institutions: $53,200
How to Calculate College Costs?
In order to get the answer to “how much is college tuition going to cost?”, in your specific case, you need to find the net price of your preferred institution. Almost all colleges offer net price calculators, which allow you to enter your details and determine your cost estimates.
These net price calculations are based upon each college’s records. After assessing your scholarships and grants, these calculators let you know the total cost of attendance students like you paid in the past year.
After you have obtained a net price estimate, you can move forward with determining your affordability for school expenses. Since your living arrangements might make a world of difference, you may want to keep an open mind to options such as living with family.
What’s In Your Budget?
Before you start preparing your application for a college, you might want to ensure that it is accessible within your means. This is especially true if you have limited financing at hand and want to be certain that you are not choosing an option that you can’t afford.
Check Your Scholarships and Grants
A tuition calculator allows you to instantly deduct your scholarships and grants from your total cost of attendance. But if you have any updated information, you might want to make it a part of your calculations right away. This helps you ensure that you are factoring in all the support that you have available.
Consider Your Room and Board Expenses
Since living on-campus or off-campus drives up your cost of living to almost the same level, you may consider living with parents or guardians. This option is only available to those whose family lives close to campus. But if it’s within your reach, you may like the benefits it brings to the table.
Compare Different Schools
If your cost of attendance for a particular college goes higher than your budget, you may try looking at other options. In many cases, you may find some affordable alternatives around the same location, but you may also want to expand your search to another state. This makes a significant difference if you compare the costs between public and private institutions.
Start Making a Budget
If your out of pocket costs are making you worried, you may turn towards the practice of budgeting. In case you already have a budget, integrating your college expenses within it may only take a moment or two. But if you don’t have a budget, you can also make one with Mint in just a few minutes.
Determine Your Financial Support
These steps may help you shortlist colleges that fit within your budget. In some cases, going through all financial best practices may still have you running short of funds and options. That is where you may start looking into additional financial support. This could most often come from a lender. But it may also be available through your parents or other family members.
If you still need further financial support, you can look at a variety of funding options.
What Are Funding Options?
There are various funding options available for new college students. These approaches allow you to gather financing for your college and ensure that you can pursue your higher education according to your plans.
You can consider the following funding measures and choose something that fits your requirements.
Federal Student Loans
Federal student loans are one of the most popular ways to fund your college. Through these loans, you can continue your education and obtain your degree before you have to start worrying about repayments.
Here are some of the most popular characteristics of federal student loans.
- They don’t require excellent credit history.
- They don’t ask for a co-signer.
- They come with competitive interest rates.
- They may offer subsidized options with relaxed interest terms.
- You can also benefit from relief programs in certain cases.
Private Student Loans
If you cannot get a federal student loan, you may want to start paying for college using a private student loan. These loans are available through a variety of lenders. They also hold their own distinctions that set them apart from federal student loans.
These features include but are not limited to the following.
- They often require a strong credit history.
- They might need a co-signer.
- They typically have higher interest rates.
- They are often non-compromising on their late payment terms.
- They usually don’t entertain federally-backed relief programs.
College Fund
Many parents start building a college fund for their children from an early age. If your family has followed the same approach, you may benefit from a 529 college savings plan—which we cover more in depth in Chapter 5. While some parents are transparent about the availability of these funds, you may check-in with your parents to see if you have such an account to your name.
Saving Options
If you have saved up most of the funds you’ll need for college but cannot seem to come up with the last bit you need, you may also look into your personal savings. If you don’t have such a safety net, you can save for college for a little while longer and make up the difference by yourself.
What Do You Need to Pay Post-Graduation?
If you took out student loans to fulfill your dreams of a higher education, your graduation may also bring the repayment process to your plate. It’s important that you understand the intricacies of these requirements through measures such as reading financial books for college students.
Besides helping you steer clear of surprises, this also lets you plan your future steps through an informed approach. In turn, you can be ready to make your student loan payments the second the first payment rears its head.
Typically, payments for most federal loans start six months after your graduation. For private loans, the payments may begin in college in terms of interest-only contributions, but you can also defer these payments for six or nine months after your graduation.
How much you need to pay per month depends on a variety of factors. You can use a loan simulator to get an estimate of these payments and prepare for the future. This allows you to manage your expectations after your graduation.
You can also look into learning money management for college grads. These measures can guide you through best practices of handling your finances after your graduation, and stay on par with your student loan repayment requirements.
How Can You Calculate the Total Cost?
You can calculate the total cost of attendance for your college through online tools like the ones we mentioned earlier. These college tuition calculator solutions are often available on each college’s website, while also being accessible through federal and state government websites.
You may also follow the same practice by using loan simulators and loan calculators that are available through the websites of different lenders. This allows you to make informed decisions about your immediate and long-term future.
In Conclusion
It is important for you to have a firm grasp on the concept of college costs, financial support, and post-graduation repayment processes. This makes sure that you can plan accordingly for the best financial stability, while also taking care of yourself, your loved ones, and your chosen career.
In the upcoming chapters, you’ll become more familiarized with the process of pursuing your ideal educational degree and how to pay for it. Now that you have a better understanding of how to calculate and estimate college costs, let’s dive into Chapter 2: Start Saving for College.
Sources: Education Data Initiative | National Center for Education Statistics | College Affordability and Transparency Center | Federal Student Aid
The post Chapter 1: Estimate Education Costs with a College Tuition Calculator appeared first on MintLife Blog.
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