We all want our children and grandchildren to be successful in life. Often this translates to a college degree, but a degree doesn’t ensure success or even a job these days.
Encourage your child to really understand the costs and benefits of a BA or BS. There are alternative to college to consider
How Much Does College Cost?
The cost of attending a traditional 4 year college is increasing every year, making saving for college a priority for many parents. [Don't forget to fund your retirement before funding your kid's college.]
Just how much does it cost to attend college? A lot! Use this handy college search tool to determine the cost of tuition, books, room & board for your school of choice.
I did a search for my alma mater Auburn University.
You can also adjust the tab to your appropriate income level.
According to FinAid, the inflation rate for college tuition is double the general inflation rate of around 2%-4% of recent years.
Use this guide to determine how much you’ll need to earn on your college savings fund:
- Conservative: 3%-5%
- Moderate 5%-7%
- Aggressive 7%-9%
- Very Aggressive 9%-12%+
In order to keep up with inflation and the rising costs of college, you’ll need to at least be in the moderate earnings range to break even. If college inflation rates are 8% and you earn 8%, you’ve only broken even.
Paying for college without scholarships, grants, and loans is difficult if not impossible.
[We'd need to save $277,553.00 for my son to attend in-state tuition+ room and board to my alma mater.--Are you kidding me?]
It is recommended for parents to save 1/3 of the costs, cash flow 1/3 of the costs, and fund the other 1/3 alternatively (student work, loans, scholarships, grants, –go to the bottom for more ideas).
Use the calculators below to estimate how much you’ll need to save.
10 Free College Savings Calculators
If you’re trying to figure out how much to save for your kid’s college fund, look no further. These savings calculators will help guide you to saving for the college education for your children.
I’ll also rate the calculators with a maximum of 5 stars for 1) usability 2) graphics 3) functionally. Yes, this will be subjective.
1. The College Board has a handy calculator that allows you to adjust for several variables including how much % to save, earning %, inflation %. 3 Stars
2. FinAid has several savings calculators, but I found it hard to know which to use and they where just clunky, but the numbers seemed legit. 2 Stars
3. Saving for College offers their World’s Simplest College Cost Calculator You only input your kids age and adjust the variables afterwards. Easy. 4 Stars
4. FINRA College Savings Calculator has basic input options, chart is difficult to understand and it doesn’t break down how much I need to save per month. 1 Star
5. Bankrate Their College Calculator has easy input, gives me monthly savings goal–no graphs, but it does the job. 3 Stars
6. ING- College Funding Calculator I expected more fun from ING. It was fairly plain, but got the job done. 3 Stars
7. MSN Money College Savings Calculator does a good job, color charts and graphs, and allows for tax rate 4 Stars
8. Vanguard- Of course they have great College Savings Planner. Interactive & colorful, can plan up to 5 kids, change variables, search for your school of choice and it will plug in the numbers automatically. When you finish, you can print out a report to save or print out. 5 Stars
9. T. Rowe Price has a College Investment Calculator I don’t like the fact that I have to figure out the year each child will enter college. I should be able to enter their current age instead. I’m also forced to choose one of their 529 plans before I’m given an amount. This tool isn’t about education, but about sales. 2 Stars
10. Charles Schwab- College Savings Calculator Easy to input, easy to understand, interactive, and gives an action plan with monthly savings goals. 4 Stars
What Now?
So if you’re like me, you’re flabbergasted by how much you’ll need to save for just 1 child’s college! If you’ve got several kids, plan on some of these other options.
- I’m considering not sending my kids to college. I’m saving of course, but there are alternatives to college.
- Your child can attend community college and transfer to a four year and cut their cost almost in half.
- Pick a college that gives you a good bang for your buck. Check out the Best Values in Public Colleges from Kiplinger.
- Work. Work. Work. Your child can work during the summers and during school to help offset the living costs during the school year.
- Grants and Scholarship- Their senior year can be spent applying for grants and scholarships as a part time job.
- 17 more ways to pay for college without loans.
- Loans should be a last alternative and only taken out if all the above alternatives have been exhausted.
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