Understanding the Cost of College

Converting dollars into knowledge isn’t cheap these days, and it gets more expensive every year. Even before you step foot on campus, you’ll face several upfront costs. Here is what you may encounter:

Upfront Costs:

SAT/ACT: Both the SAT and the ACT tests cost money to take, though the actual amount is different for each. For both tests, you’re able to send your scores to four colleges for free. However, if you’re applying to more than four schools, you’ll need to cover the cost to send the additional scores.

Transcripts: In addition to the cost to send your test scores, you’ll also need to send your high school transcripts to the schools to which you’re applying. Speak with your guidance counselor to understand the cost and process for doing this.

Application: Beyond filling out an application for each school to which you apply, you’ll likely be responsible for an application fee as well. The average application fee runs to about $42, according to a study by U.S. News & World Report.*

Housing and tuition deposits: Once you’ve been accepted and made a decision on the school you wish to attend, you’ll likely need to make two deposits to hold your spot: a housing deposit to hold your place in student housing and a tuition deposit to confirm your enrollment. Amounts for both of these vary by school.

Ongoing Costs:

Tuition and fees: Tuition is the cost of the actual classes you take at college and can vary depending on the school you attend and the number of classes (or credits) you plan to take each semester. Your major can also influence the price of tuition. For example, resources and supplies used in engineering or computing may be more expensive than the needs of business or finance majors. As for fees, these may include student parking, library access, lab fees and other campus services.

Room and board: Room and board is the price to keep you sheltered and fed. Most schools offer on-campus housing or dormitories, as well as campus dining plans. Costs vary by school, meal plan options and dorm selection. If you choose to live off-campus or forgo a meal plan, these expenses will be an out-of-pocket cost rather than a lump sum charged by your school. Keep in mind that costs depend on your school’s location; campus housing in Farmville, VA will be a great deal less than a Manhattan apartment. You may live on-campus for all or part of your time at school.

Books: Most college classes require at least one textbook, and with some costing more than $100 each, expenses can stack up quickly. Consider all of your cost-saving options, including renting, downloading e-book versions or purchasing used editions. If none of those options are available, you may want to sell back your books to recoup some of your money.

Living expenses: Beyond the books, lessons, food and bed, you’ll also have other incidental costs to contend with. Whether you prefer hitting up the new trendy café or are content eating macaroni and cheese, most living expenses are at the mercy of your own spending habits

*Source: U.S. News & World Report, usnews.com.

School Cost Comparison

You’ll find significant financial differences between each type of school, but a school is much more than a price tag. Consider characteristics distinct to public, private and community colleges, as well as the unique values inherently woven into a school’s fabric.

School Type Average Tuition & Fees Average Room & Board Total Annual Cost
2-year college* Many students start their journey to a 4-year degree at a 2-year college. These are typically technical or community colleges and provide the skills for a specific job in the workforce, like a nurse or a machinist. 2-year colleges allow students to achieve a degree (typically an associate’s degree) at a lower cost and offer the opportunity to transfer the credit you’ve earned to a 4-year institution. $3,347 $7,705 $11,052
4-year public school A 4-year public university typically offers a range of majors and student organizations, thanks to its larger student body. You also may find much larger class sizes (especially in introductory classes) than at a private university. If you’re considering public institutions in other states, check the difference between in-state and out-of-state tuition. Some out-of-state colleges offer tuition reciprocity (a discount on tuition) to residents of certain states.

In-state:

$9,139

$9,804 $18,943

Out-of-state:

$22,958

$9,804 $32,762
4-year private school A 4-year private college may offer fewer majors and extracurricular activities than a public university, but students benefit from smaller class sizes and privately-funded facilities. Keep in mind that without state funding, the cost of tuition is usually much higher, too. $31,231 $11,188 $42,419
Source: CollegeBoard for 2013-2014 school year.
*Often referred to as Community, Technical or Junior Colleges.

The Rising Cost of College

Since 1975, the price of tuition and fees for any type of college has steadily increased.

Source: http://trends.collegeboard.org/college-pricing/figures-tables/tuition-fees-room-board-time.

Can Student Aid Keep Up?

Student aid (e.g., grants, federal loan aid, tax benefits, work study) has, for the most part, kept pace with the rising price tag of college. However, as the total cost increases, so does the gap that must be filled with private loans and other financing options.

Academic Year Average Annual Cost of Private
4-Year Degree
Average
Total Aid per Full-Time Student
Difference
that Student Must Pay 
Percent
of Total Cost that Aid Covers
1974-75 $10,273 $5,015 $5,258 50%
1984-85
$12,716 $4,507 $8,209
35%
1994-95 $18,814 $7,349 $11,465 39%
2004-05 $25,215 $11,218
$13,997 44%
2014-15 $31,231 $15,821 $15,410 50%

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