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Amy Goan, MBA, CFP®
Email: amy@prismfinancialplanning.com
18708 SE 45th St., Issaquah, WA 98027
425-641-5717

Are You Kidding Me?!—Cost of a College Education, 2014-2015

 

You've decided to get serious about planning for your child's education. Good for you! Your first questions is: How much is this going to cost me? You've heard rumors about escalating tuition costs that are rising faster than inflation. I'm sorry to report that those rumors are true. According to http://studentaid.ed.gov, the average inflation rate for public four-year schools is expected to be 6.5% between 2000 and 2015. This compares with a general inflation rate of about 2.5%. So, what does this translate into dollars and cents? Below, I've compiled a summary of costs for the academic year 2013-2014 from various schools, which I found on their websites. They are all for undergraduates enrolled full-time, and assume the student is a resident of the state of Washington.

   

Estimated Total Expenses

 

Tuition and Fees Only

Lives w/ Parents

Lives Away from Home

University of Washington-Seattle

$ 12,394

$ 19,762

$ 27,112

Washington State-Pullman

$ 11,396

n/a

$ 28,176

Bellevue College

$ 4,614

$ 11,864

$ 18,414

Pacific Lutheran University

$ 36,180

$ 43,780

$ 50,258

Florida State University-Tallahassee

$ 20,918

n/a

$ 39,058

Stanford University

$ 44,184

n/a

$ 62,801

Oregon State University

$ 26,295

n/a

$ 41,766

If your child has her heart set on a particular school and you're curious about its costs, just Google "(school name) cost of attendance". As you can see, a college education is not cheap. However, there's a wide range of options for the cost of that education. Out-of-state and private schools are quite pricey, but good ol' UW isn't too painful, if your child is willing to live at home (and you're willing to have him!)wink On the other hand, you may want to consider having your child go to a community college to earn their AA, then move on to the school of their dreams. I'm not sure who first said "knowledge is power", but they were right when it comes to college planning. Having a handle on the cost of a college education is the first step in preparing for that education. For information on how to save for college, available college loans, and grants/scholarships, please refer to my previous three-part post on "How to Pay for Junior's College". A Final Suggestion: To ease the pain of saving for college, try to start as early as possible. By that I mean, NOW! If you plan on saving a certain amount each month with the goal of a $125,000 college fund (4 years at UW, living away from home), the size of that monthly contribution varies greatly, depending on when you start.

# of years

# of months

monthly contribution

5

60

$ 2,083

10

120

$ 1,042

15

180

$ 694

20

240

$ 521

If you invest that savings, instead of just placing it in a non-interest earning account (as I assumed in the chart above) the benefits of starting early are magnified even more. So, just like in Chicago residents are urged to vote "early and often", my advice to you when it comes to saving for college is to save "early and as much as you can".  

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