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Estimating College Costs

This article is meant to help you gain a better understanding of how to gain the necessary information around college costs. As always, contact your Program Manager with any specific questions, comments, or concerns.

Did you know that colleges with higher sticker prices sometimes offer more financial aid? Or that colleges differ in the types of aid they offer? Below are a few tips that will help you estimate the real amount you’ll have to pay to attend the colleges you’re considering.

Focus on Net Price

Your net price for a college is the published price for tuition and fees minus your gift aid and education tax benefits. Gift aid includes grants and scholarships but not loans or money earned through a work-study job. Getting your estimated net price is the best way to get an early answer to the question of how much a college will really cost you. Learn more about net price.

Cost Figures to Know for Your College Search

Your personalized estimated net price is the best indicator of what a particular college will cost you. But if you’re just beginning your college search, the types of figures listed below can help you decide if you want to get more information on a college or use its net price calculator.

Average Net Price

The average net price of a college is what the student really pays to go to that college. The U.S. Department of Education defines average net price as follows: “An estimate of the actual cost that a student and his family need to pay in a given year to cover education expenses for the student to attend a particular school. Net price is determined by taking the institution's cost of attendance and subtracting any grants and scholarships for which the student may be eligible.”

A college you’re interested in, for example, a four-year public institution, might have an in-state, published price of $9,410. But its average net price might be only $3,980 — which includes room and board and other costs. That’s a big difference.

Average Percent of Need Met

Most colleges are not able to cover 100 percent of a student’s demonstrated financial need. You can get an idea of how much aid a college might award you and your family by checking to see what it has typically awarded other students in the past.

For example, if your family has demonstrated need of $10,000, and the college you are interested in has an average percent of need met of 75 percent, then your financial aid award (for one academic year) from this college might be about $7,500.

Average Percent of Gift Aid

Different colleges have different ways of awarding their financial aid packages. The final award is generally divided into a combination of scholarships and grants, work-study jobs and loans. Only scholarships and grants are considered gift aid.

If a college awards you a financial aid package of $7,500, and the average percent of gift aid is 50 percent, then you can expect your award to include approximately $3,750 in grants and scholarships. The rest of the award would likely be a combination of loans and work-study earnings.

Keep in mind that when you look at average percent of gift aid, a bigger number is better.

Tips and Reminders

As you consider these key figures, keep the following in mind:

  • Calculating your estimated net price will give you the best idea of how much a college will really cost you.
  • Averages give you only a general overview of how a college has awarded financial aid to other students in the past. Financial aid officers at each college will weigh your circumstances before deciding on your actual financial aid award.