College Sticker Price vs. Real Price
The media frenzy over the price of college makes us all nervous. Is there a way to get an idea about what college might actually cost?
Yes there is. It is called a Net Price Calculator. A net price calculator will show you the “net” or what is left for the families to pay for after deducting State and Federal grants, school scholarships, and in some cases merit scholarships. Not all net price calculators are created equal, if it only asks a few questions about income and not GPA or test scores it may not give you an accurate estimate.
Wellesley College, a beautiful women’s college outside Boston, created an easy net calculator for you to try. It asks for your total income, your amount of home equity (if applicable), how much you have in assets/investments, and how much in retirement savings (which is optional because it is not part of the calculation). None of the information is saved or identified as coming from you. Wellesley’s sticker price is $61,000. Punch in the numbers and see what comes out. http://www.wellesley.edu/admission/affordable/myintuition
At Wellesley, for instance, a home owning family that earns $54,000; has $25,000 in savings; and has $700,000 in home equity. According to the calculator the family would be eligible for $52,900 in free money, grants or scholarship aid from the federal government and the school. The parents/student contribution or EFC (expected family contribution) is $6,000/year. The students is expected to work on campus for $2,100 in work study. The family could make up the $6,000 through loans or out of pocket.
For a more comprehensive net price calculator you will need last year’s tax forms. Pick a school, any school, and enter “net price calculator” or look for it on the financial aid page. Some schools have their own, like UCLA and USC, other schools use one provided by College Board. The UC ones are not the best, but put in the same numbers for UCLA and for a $35,000 sticker price, the family would be eligible for between $14,000 and $17,000 in grant aid; would have a total expected remaining price tag of $20,500 which could be made up with loans or out of pocket. Note, this does not include merit aid if applicable. At least one family with numbers like these ended up paying only $5,000 a year due to scholarships based on merit.
Notice, if you pick a well-funded private school it can cost less than a public one!
Use the net price calculator to get an idea of the actual cost of college. Then check to see what merit aid if any your student might be eligible for. This way you continue the college search armed with information.