With the average four-year private college sticker price at $48,380 in 2019-20 according to the College Board, paying for one year of college is a substantial commitment. But costs for tuition, fees, and room and board don’t just stand still.
From freshman year to senior year, these college costs are estimated to rise $4,486. This means the average family paying for all 4 years of a bachelor's degree will be a wapping $202,404.
With this kind of an investment, why are you considering less than a quarter of costs when making a decision about college?
Can you imagine if a real estate listing only displayed a portion of the costs and you were expected to somehow divine what the entire costs would be? When you review college costs on the admissions website will feel like. The reality is that on average college costs for tuition, fees, and room and board rose at 3% over the last decade, so one year will not be the same cost as the next.
Sticker Price Isn’t What Most People Pay
With the over $57 billion of gift aid - that is scholarships and grants - awarded to college students attending 4-year public and private colleges, it’s clear that not everyone is paying sticker price.
Just like the sticker price on the window of the Dodge Durango didn’t translate into what you really paid after the manufacturer's rebate and the dealer’s discount, gift aid will reduce your college costs.
To calculate net price, subtract the gift aid from the cost of attendance - that is published tuition, fees, room and board, books and supplies, and personal expenses. The average for a private nonprofit 4-year college in 2019-20 is $27,400 vs. $48,380 in sticker price.
All colleges publish the average net price for all their students with gift aid, and many publish the averages by income-bands. Plus, the federal government requires that every college provide a net price calculator so that families can get a better idea on their eligibility for gift aid. Just be aware that some of these net price calculators are amazingly accurate, and others are not. To easily find the net price calculator for any college, check out the US Department of Education’s NPC Center.
Written by: Colleen Krumiede, Financial aid expert
Over a decade at Stanford GSB, Caltech, & Pomona College.
Affordability advocate working in educational finance & technology companies servicing higher education. Co-Founder of Quatromoney, helping families make better, personalized financial decisions to
manage all 4-years of college costs and think about what's next.