The College Board says that students enrolled at a private college in 2015-2016 school year will pay roughly $44,000 in tuition and fees. Public, in-state students will pay around $19,000.
That is enough to frighten any parent with a child, let alone several children.
However, did you know that there’s a difference between the sticker price of a college education and the net price that most students actually pay? Students with financial challenges can often dramatically reduce the cost of a college education.
Even those students who do not fit in the low- to moderate-income range can significantly reduce their college costs by making less expensive choices.
When it comes to paying for college, net price is what matters.
As the American Enterprise Institute says, net price is what students pay. Sticker prices are the tuition and fees that colleges advertise publicly.
The difference usually comes from the automatic aid that many colleges offer to low or moderate income students.
Once you factor in available financial aid packages, the net price of attendance can drop dramatically.
The problem is, too many parents do not understand the difference between the sticker price and net price.
The American Enterprise Institute reports that six in 10 families rule out some colleges because of their high sticker prices yet never take the time to inquire about these schools’ net prices.
If you want to give your children a chance to attend the widest variety of colleges or universities possible, you’ll have to explore the actual net prices of these schools, not just their sticker prices.
Saving money by making different choices
Students can also save money in tuition and expenses by making difference education choices.
It might not make sense, for instance, for students to choose the ritziest private school available, not when it is possible to receive a quality education at other less-heralded universities or colleges.
For instance, College Board estimates that students who enrolled at private colleges in 2015-2016 would pay $43,921 in tuition, fees and room and board.
They also estimate that students enrolled at in-state public universities in 2015-2016 would pay $19,548 in tuition, fees and room and board.
That is a huge difference in price
College Board shows how it is also possible for students to get a private college experience at a far lower price. Students just have to be creative.
For instance, students who enrolled in a community college in 2015-2016 would pay $11,438 for the year.
Many of these students will move on to attend a private college for their final two years. That is pricey, but it is far lower than what these students would pay for four years of private college.
It is important for parents to offer advice to their children as they contemplate college. That is because tuition and fees are not getting any lower.
College Board says that during the last ten years, college tuition and fees rose an average of about 6 percent a year. This is higher than the rate of inflation and the average jump in personal incomes during this time.
The board’s numbers also point to another fact: Parents who want to help their children pay for college need to start saving early.
The sooner parents start socking away money for their children’s college education, the less painful the process will be.
Also, the sooner parents and their children start researching financial aid, grant, and scholarship opportunities; the more likely they’ll be to save for college without falling deeply into debt.