Despite a long-term increase, college enrollment has fallen over the past decade. There’s a widespread perception that college tuition is too expensive. For most of the US, college tuition has outpaced inflation. Blame has been placed on a decline in state aid to colleges, as well as an increase in administrative staff. More employees = more costs.
As a parent, you can’t stop colleges from raising prices, but you can better understand what components make up the overall cost and how to reduce them.
College tuition has both a sticker price and a net price. With some digging, you might find the cost of tuition, housing, books, and meals on a school’s website. This number is the average sticker price. Researching a college’s sticker price is suitable for “window shopping” different schools, but like buying a car, not everyone will pay the sticker price. You’ll need to determine the net price to make the best decision on where your teen should apply. You may think a certain college is out because their sticker price is so high, but you could actually afford it with financial aid and scholarships.
So how do you figure out your net price for a school? I will be honest, it’s not easy, but you can do it with some time, patience, and perseverance. Most colleges have a net price calculator on their website, but it’s often hard to find. When I do research for parents, I typically Google “XYZ college net price calculator” to find it. That usually does the trick.
Keep in mind that not all net price calculators are created equally. I can easily spot a bad one just by looking at the first screen. Calculators that don’t ask many questions are unreliable.
Before you get started, you’ll need your income and how much money you have in different assets. The results from your calculation will look similar to this:
Pay Close Attention To…
- The school year on which the numbers are based. In this example, it says ‘Academic Year 2019 – 20”. Not bad, but make sure to check for a recent school year. I was researching for a family recently, and the school had numbers from 2016 on their website. I had to call the school to get the most recent numbers.
- Sometimes schools will add loans you could receive to reduce costs. The net price may be lower now, but you’ll eventually have to pay it back.
- The aid listed may include competitive scholarships that your teen may or may not receive. Or it may not include a scholarship your teen could get if they increase their SAT score by a few points.
- Calculators do not include tax credits, or they may only show in-state tuition when you are out of state.
You can see how this process can be complicated. This is where hiring a college consultant is very beneficial. One of the main reasons parents hire us is because “it’s what I don’t know that you do” to help make the best college choice. We do all the research for you and provide insight and guidance that you would never find on your own.
Need help finding the right fit, right price college? Schedule a complimentary College Assessment plan call to learn more about our Take Action Package. It includes a customized college planning guide, help with college essay writing, and ensuring your teen stays on track and gets applications in on time.