How Much Do You Know About College Costs?
By Colleen Kane
- PUBLISHED August 06
- 5 MINUTE READ
The prospect of paying for your child’s education, especially college, can be daunting. But preparing is easier when you know what you’re dealing with. Take this quiz to see how informed you are about college costs.
1What is the average approximate annual cost for public/private college?
Answer B. The College Board reported expenses of $25,290 for public and $50,900 for private colleges for the 2017–18 school year.
2You can create tax-advantaged savings for your children’s educations in a 529 fund. But when should you begin saving?
Answer D. Although more than half of parents in one survey said they think starting an education fund in high school will be enough, that may not be realistic. One calculation puts the amount you would have to save to pay for a public university at $415 a month, assuming half the cost will be drawn from those savings and half from current income or loans. Meanwhile, you can start a 529 plan even before you have a child. Just open the account using your own Social Security number, then later transfer it using your new baby’s name and Social Security number.
3How much do textbooks total for an academic year these days?
Answer C. The average annual cost for books and supplies for a full-time undergrad at a public college is $1,298, although buying used books and renting can reduce that amount. It may be a good idea to set up a savings account for this and other expenses outside tuition, room and board.
4What percentage of four-year college students received financial aid in 2016?
Answer A. It’s 85%. But it could be even higher if more students applied. Many think that they don’t qualify. Or in the case of certain low-income students, they don’t apply to college at all because they assume they can’t afford it.
5When should you file the Free Application for Federal Student Aid (FAFSA)?
Answer D. October 1 is the earliest date to file, and deadlines tend to occur at the end of June for the upcoming academic year, though it varies from college to college. Don’t forget that in order to be eligible for aid, students need to file this application every year.
6Your teenager’s grandparents have a 529 plan for her education. Will using it affect his or her financial aid eligibility?
Answer B. For this reason, it may be best to save Granny’s 529 funds to pay for the last year of school, depending on how much is in the account and how much financial aid is needed.
7Can money from 529 college savings plans be used to buy computers?
Answer B. In December 2015, congressional legislation extended qualified education expenses to include computers and related equipment like printers, as well as Internet access.
8Commuters and students with off-campus jobs need to figure in transportation costs. In addition to potentially buying a car, how much can you likely expect the other costs of transportation, like gas, insurance, parking permits and maintenance, to add up to per year?
Answer B. The estimates given are for University of Florida ($1,100) and Central Washington University ($1,260) for the 2017–18 school year, though other estimates vary. These expenses generally can’t be paid for with 529 accounts, although federal student loans may cover the cost. It’s another expense to save for separately, or for the student to cover with a part-time job.
9How much can students earn at a part-time job or summer job without impacting financial aid?
Answer C. For the 2017–18 school year, the Income Protection Allowance (IPA) is $6,420. Earnings over that amount will reduce student financial aid.
Colleen Kane is a freelance writer who has contributed to CNBC, Fortune, Money and many other publications.