The Eye-Popping Cost of College

Did you know that for the 2024–2025 academic year, the average cost for one year of college—including tuition, fees, room, board, and other expenses—is $29,910? That price is for public four-year, in-state schools. To attend a private university, the cost jumps up to a whopping $62,990. That works out to a six-figure commitment for a four-year degree.

Footing the higher education bills for your child or grandchild may seem daunting, but with the right preparation, it isn’t out of reach.

The first thing to remember is that while the price tag for college is rather eye-popping, not everyone pays the full price. Many students receive grants, scholarships, awards, and/or reduced tuition as part of their financial aid package. Although college costs have roughly doubled in the past 30 years, financial aid and merit scholarships have risen similarly.1

However, college is often a family commitment, even with aid and scholarships. Here are a few tips I like to share for those starting to think about saving for college:

A Word of Caution:

• Don’t put off saving for college. Getting an early start can help put you in a stronger financial position if it's one of your goals.
• Have an early and honest conversation with your family and college-bound children about how much you’re prepared to spend. Don’t let your student buy the sweatshirt if the school’s cost is prohibitive.
• Remember: While retirement is necessary, a parent-funded college education is a luxury. Think twice before dipping into a retirement account to pay for your child’s or grandchild’s education.

A Word of Encouragement:

• Consider starting a college fund for your child’s or grandchild’s education. There are several programs for this, including some that offer tax advantages.
• Submit the Free Application for Federal Student Aid (FAFSA) to your student’s target college, even if you don’t expect to qualify. Submitting this form may help put your student in a position to accept any grants or scholarships before considering student loans.
• Search for scholarship opportunities, which many organizations offer.
• Consider federal student loan choices before exploring private loan programs. Federal loans may have benefits not offered by private loans.

We’ve helped clients implement college strategies with a wide variety of funding choices, and this is a gratifying aspect of our role as financial professionals.

^{1. CollegeBoard.org, October 2024}