Before you send your teen off to college, it’s important for you to understand the many expenses associated with earning a degree. Once you know how much it costs, you can set realistic goals for how much you can contribute to your student’s education and how much more your student will need to come up with. It’s imperative that you and your teen understand where the money will be coming from, and if they have to take out student loans, they should know that they’ll need to pay them back once they stop going to school. This list explores some of the costs that your teen will most likely face.
According to a report by the College Board, the average cost of tuition for a public in-state school is $9,410 per year, with the average cost of out-of-state tuition closer to $23,000 per year. A smaller, private school will set you back an average of $32,405 per year.
Room and Board
Room and board will add an additional $10,000 or more per year, according to the same report. This typically includes a meal plan and a shared dorm room but only some of the necessary furnishings. While many of the additional necessities will be one-off costs, you will still need to budget for bedding, linens and furniture such as chairs, futons, pillows and full-length mirrors – and it can add up fast.
Textbooks, Program Fees and Supplies
The College Board also estimates that textbooks cost nearly $1,200 per year. The exact prices will vary depending on what courses your student takes. As an economics major, my books rarely exceeded $300 a semester, but my friends in the sciences regularly purchased books and supplies that cost significantly more. This doesn’t include other school supplies, program fees or lab fees that might be associated with science or technical courses. Encourage your student to find alternatives to paying for brand-new books from the campus bookstore. For example, your student can purchase them used or rent them for the semester.
A laptop computer or tablet is a must for college students. While they can use the library or computer labs on campus, they’ll almost certainly need something portable to work on. Laptops can range from $200 to over $1,000, depending on the brand and model.
Students need to take into consideration meals at restaurants, drinks (e.g., coffee and juice) and the occasional night out on the town. These expenses differ from student to student and even school to school, as offerings on campuses vary widely. At my private liberal arts college in the middle of nowhere, we had fewer than five restaurants within walking distance, but the school provided free comedy shows and food festivals every week, meaning I only spent around $10 a week, on average, on entertainment. Conversely, my friends at big state schools regularly ate out at restaurants and went to the movies. You might be accustomed to lending your teen money for these types of things now, but you’ll need to set expectations beforehand for what you plan to contribute.
Your student might be covered under your health care benefits now, but that might change depending on their age or stage of life. Health care is a huge monthly expense that they will need to budget for if they’re no longer on your plan.
Internet and Phone
If they haven’t been paying for their phone and Internet already, your student may have to budget for those expenses, too. Check to see what’s included in their room and board fees, and discuss whether they can stay on your phone plan.
Whether your student is commuting from home or going to school out of state, you should consider costs for getting to and from campus. Your student might be flying or driving several times a year, so budget for holidays and family events they might want to come home for, in addition to traveling to and from school for each semester. This should include the cost of transporting or shipping any personal or large items, such as furniture, at the beginning and end of each school year. Cha-ching!
It’s important to discuss miscellaneous expenses. Many schools estimate these to be in the range of $1,000 – $2,000 per year. This category can differ drastically based on students’ habits. For example, some students drink Starbucks every day, while others wouldn’t dream of spending $3 on a single cup of coffee. You may be accustomed to helping with or outright paying for some of these expenses, but you’ll need to decide upfront if you’re willing to pay for them in the future or if your student needs to start coughing up the cash.
Totaling It Up
I checked out Michigan State University’s net price calculator and found that the total cost of tuition, room and board, books and “other expenses” came in at $26,100 for the 2015 – 2016 academic year. The calculator estimated books to be $1,000 and other expenses to be close to $2,000. Here, you can see your estimated family contribution (EFC), which is determined by your school when deciding your eligibility for loans, grants and scholarships. I was eligible for a small $600 scholarship but was expected to pay for the rest of these expenses with loans, my own savings and help from my family.
The Cost of Going to School for More Than Four Years
The high cost of college is the result of many factors, but once you add additional semesters to the four years that people typically think of as normal for earning a college degree, the costs increase substantially. Surprisingly, only 19% of full-time students graduate in four years from public universities, according to a 2014 study. This means that over 80% of students need to pay for one or more extra classes or even whole semesters. One additional year of tuition and room and board might cost $25,000, but the money lost when a student doesn’t begin working full-time after four years is also substantial. If your student could be making $35,000 a year after college, that’s a lot of money lost when they go past the four-year mark.
Graduating on time or early results in colossal savings, so it’s important to sit down with your teen and an advisor from the school to create a four-year plan. If they know what their major is, encourage them to take the required courses before they take anything that isn’t required. If they’re undecided, they can usually take the general education courses that everyone needs for graduation for the first year or two while they’re making a decision. Some planning in the beginning can lead to huge savings in the long run!
The Cost of Student Loans
Once you understand these costs, you can help put them in context so that your student grasps how much money they’re really borrowing. Explaining that you would have to babysit for 2,500 hours at $10 an hour to pay for one year of college will help your student see how big an investment college really is and encourage them to take it seriously.
The average college senior racked up $37,172 of student loan debt, according to leading student financial aid expert Mark Kantrowitz. If your student takes out loans, make sure they understand that these will need to be paid back with interest. This means that a direct subsidized loan of $25,000 at 4.29% interest will accrue thousands of dollars in interest. To estimate the true cost of your particular loan, use a repayment estimator such as this one, which looks at the loan type, interest rate and earned income to estimate several repayment plans.
Looking for more information? Try using one of these net price calculators to see what costs your student is facing and how they add up.
Your teen might be preparing for adulthood, but they still need guidance from you. It’s important that you be informed about the costs ahead of time so there aren’t any big surprises. Once this happens, you can enjoy the process of watching your student pick a college and start a new chapter in life.
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