Complete Guide: How Much Does College Cost, Really?

If you're thinking about going to college, you probably know by now that an education is, well, expensive. It's not just tuition you're worried about—there are so many other costs associated with forging out on your own, especially if you'll be living away from home for the first time. The best way to tackle these expenses? First, you have to educate yourself about the reality of college costs.

In this comprehensive guide, I'll walk you through all the expenses you'll need to consider when you go to college, both obvious and not-so-obvious. Then, I'll discuss factors that affect how much money you and your family actually pay out-of-pocket—it's not as hard as you think to get a first-rate education for a bargain.

Major Costs

These are the expenses you probably already know about. They're the big costs associated with getting a college education, and they'll make up the bulk of your expenses.

College Tuition and Fees

Your tuition charge is what you pay for actual academic instruction and class credit. Students are often billed per semester, credit hour, or quarter. Fees are often for mandatory student service charges and are tacked on to the tuition so that they're reported together.

For the 2014-2015 academic year, the average cost of tuition and fees was:

• $31,231 at private colleges
• $9,139 for state residents at public colleges
• $22,958 for out-of-state residents at public colleges

Remember that this is just for one year of college—4 years at private colleges can cost you well into the six figures.

As you can see, there's a lot of variation in the sticker price of an education at different types of schools. What really matters, though, is the net price—what you actually end up paying. I'll discuss that more later in this post.

As you might have noticed, there's a huge difference in the average public school tuition cost for residents and non-residents: a $13,819 difference, to be exact. You'll see an even more significant discrepancy in cost at certain schools. I've put together a list of some of the largest public schools in the country so that you can see the difference in price based on residency:

Public universities can offer great educations at a great bargain for residents, but what about private schools? They're notorious for their higher sticker prices, which can scare off prospective students and parents.

But remember, what actually matters is your net cost at a particular school. As it turns out, a lot of excellent private universities also have some of the most generous financial aid programs because of their larger endowments—they can afford to give more money to students, especially to attract high-caliber students who may not otherwise be able to afford to go to their school. This effectively lowers the net cost for many students.

I’ve come up with an example to demonstrate cost differences for a student at an in-state public university, an out-of-state public university, and a private university with a generous financial aid program. My example student lives in NY state with a family income of $60,000/year, and an Expected Family Contribution (EFC) of $3,970, which I calculated using the FAFSA4caster (learn more about the FAFSA4caster here). Take a look:

Notice that the student's lowest net cost is at the school with the highest sticker price. Now, not all private schools will have financial aid programs as good as Harvard’s, but many prestigious private schools strive to meet 100% of their students' need (need = total cost of attendance—Expected Family Contribution).

My ultimate point? Don't discount pricier schools just because you don't think you could afford them; your net price could be more reasonable than you think. I'll talk more about estimating your net price at the end of this post.

College Room and Board Costs

Room fees cover your housing and utilities, whereas board fees include your meal plan.

Some schools offer customizable meal plans and housing options, so you can select room + board combinations that better fit your budget. Many students choose (or are required) to live on campus, especially their freshman year. Room and board charges are often lumped together.

You may be able to pick and choose among room and board services if you move off-campus, assuming your school allows you to live outside of their dorms. Off-campus living expenses will vary by geographical area; it may be cheaper to live in an apartment if you attend a more rural college, but you may end up paying more if do the same at a more urban school. Getting a 1-bedroom apartment near Georgetown University will cost you around $2,000/month, for example, whereas a similar apartment near Arizona State University might only cost you $800.

For the 2015-2016 academic year, the average cost of room and board was:

• $11,516 at private 4-year colleges
• $10,138 at public 4-year colleges

If only board fees paid for pizza like this in the dining halls.

Hidden College Costs

These are less obvious expenses associated with attending school but are just as important when it comes to budgeting for school and preparing adequately. When you come up with your own budget, try to be honest and realistic with yourself about how much you think you'll spend in each category.

College Books Costs

The average student spends about $1,200 per year on textbooks; it's easy to see how this adds up when some individual books can cost upwards of $200.

You may end up spending less than this each year if you:

• Purchase used textbooks
• Rent course materials
• Share books with friends or classmates
• Check out textbooks from the library
• Purchase electronic copies of textbooks

Travel Costs

Travel expenses usually include travel between home and school, and travel while you’re at school. This will vary widely across students, for obvious reasons.To calculate your travel costs between home and school, consider:

• How often you plan on going home

• The average cost of a round trip (budget more if you’re traveling via plane/train/bus during the holidays)

You’ll most likely incur some travel expenses while you’re at school as well, especially if your campus is scattered. To calculate these expenses, consider:

• How often you’ll be doing any sort of traveling (not on foot).

• Whether you’re bringing a car with you. If yes, include gas/parking costs in your travel calculation.

• Whether your school offers students discounted or free public transport passes. If not, research the cost of monthly public transport passes.

Maybe you'll factor some more exotic expenses into your travel budget.

Lab Fees & Supplies

 If you’re not a science major, chances are you won’t have to pay many (if any) lab fees. These average about $50/class. Schools usually lump these in with textbook expenses, but since these numbers are just averages, expect to pay more in this category if you’re a science major.

Personal Expenses in College

These expenses include things like clothing, laundry, toiletries, haircuts, and entertainment. The average student might spend about $2,000 per academic year on these things. This amount might sound like a lot, but if you’re in school eight months out of the year, it comes out to about $60/week.

If you tend to spend more money on things like fine dining, concerts, etc., you may want to work out your own personal expenses budget to keep track of how much you’re spending while at school.

Estimating Your Total College Cost, With Financial Aid

This guy doesn't know anything about college expenses, but he'll feel much better once he learns how to calculate his net price.

The numbers above look large—sometimes amounting to over $50,000 per year—but don't fret just yet.A huge factor affecting what you’ll actually pay for school—your net price—is your family financial situation. Generally, the lower your family's income, the more financial aid you'll be eligible for, which translates to a lower net price. This has implications in two related (but separate) domains:

1. Federal aid
2. School-specific aid

Scholarship money can also affect your net price—I'll touch on that at the end.

Federal Aid

Federal aid, which comprises grants like the Pell and loans like the Direct Subsidized and Direct Unsubsidized, is usually pretty standardized and easy to predict. Students who are interested in federal financial aid have to submit a Free Application for Federal Student Aid (FAFSA) every year (learn more about the FAFSA submission process here). The information generated by the FAFSA not only informs federal aid awards, but also institutional awards and even private grants and scholarships.

The most important figure generated by the financial information you enter into the FAFSA is called the Expected Family Contribution, or EFC. If your EFC is at or below certain thresholds, you’ll be eligible for different federal programs. For example, if your EFC is at or below $5,081 for the 2015-2016 academic year, you'll be eligible to receive the Pell Grant.

Again, because federal aid is so standardized, you can predict with good accuracy what grant and loan programs you’ll be eligible for using the FAFSA4caster. You can get step-by-step instructions on calculating your federal aid using our Pell Grant Calculator guide.

School-Based Aid

If schools award their own institutional aid, they’ll use your FAFSA information (specifically, your EFC) to calculate need-based aid eligibility. The amount of aid schools award will vary widely based on their financial aid budgets.

It’s pretty easy to estimate your net price at almost any school, especially if you know your EFC. Just Google “[school] net price calculator”—that’s what I did to estimate the cost for the schools in the chart above.

Scholarships

Outside of federal and school-based aid and scholarships, you might also consider looking into private scholarships. Scholarships can be awarded based on financial need, merit, or both. There are countless scholarship options out there, with many meant for students of different races, ethnicities, nationalities,  genders, sexualities, and academic interests. You may want to start by checking out the National Merit Scholarship, or scholarships based on your standardized test scores.

Putting it All Together: Calculate Your Net Price for College

Step 1: Visit the FAFSA4caster to estimate your EFC. The FAFSA4caster will also estimate your eligibility for the Pell Grant and some federal loans. Get step-by-step instructions on how to estimate your EFC and Pell Grant eligibility here.

Step 2: If you have a list of specific schools you're interested in, visit their net price calculators (most schools have calculators available through their financial aid websites). Try Googling "[school name] net price calculator" for results. If you're not sure where you'd like to apply, try using the net price calculators at different types of schools (e.g. public vs. private). You may have to enter your EFC. Make a note of whether the calculators include estimates school-based aid, federal aid, or both.

Step 3:  Subtract aid that you think you're eligible for based on the calculations you did in Steps 1 and 2 from the total cost of attendance. If you anticipate any scholarship earnings, subtract that amount from the CoA as well. Voilà—you have a net price! Keep in mind, though, that this is just an estimate; you won't have an official net price until you receive financial aid packages from schools.

What's Next?

Want to learn more about federal financial aid, which can bring down your net price? Check out our guide comparing Direct Subsidized and Unsubsidized loans, as well as our Pell Grant guides to eligibility criteria and limits.

Interested in strengthening your applications to schools that offer those generous financial aid packages? Get the best score possible on your SAT.