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Having a college fund for your child(ren) is a decision that many parents think about when looking at their family's finances. If they do decide to invest and save for a fund, the next decision is about how much would be appropriate.
Looking at Actual College Tuition Costs Versus Sticker Prices
Many stories in the media highlight the high costs of tuition. USA Today did a story earlier this year that tuition rose 15% between 2008 and 2010 for public universities.
Parents can be alarmed by how fast costs can increase and may feel like there is no way they can save enough for their children's fund.
However there is good reason not to get too discouraged. Kiplinger did a recent story on the best values for U.S. private colleges.
What I found interesting is the difference between the total costs quoted, the average aid given (both need and non-need based), and the average debt at graduation.
How Much Money Can We Save By Staying In-State?
Being as we live in North Carolina, I'm using in-state colleges as ballpark figures.
Here are the 4 year sticker prices for both private and public schools along with the average non-need based aid given to their students:
- UNC- Chapel Hill->$22,340/$6,659
- Duke University->$56,056/$24,323
- NC State->$31,152/*couldn't find this info – will update it when I do
- Wake Forest University->$55,960/$15,8186
Note: UNC has a net price calculator that can help you estimate costs based on general financial information you give.
We're happy that our state offers some great quality schools, but I know many others also have great options. Looking at your state's best colleges can be a smart choice for you and your kids. In-state tuition can typically save you quite a bit of money without sacrificing quality of education.
While costs are sure to rise as the years pass, it is encouraging to see that with some adjustments and an early start, parents can get a college fund set up that won;t destroy their family's finances.
Thoughts on How Much to Save for College
I'd love to hear from you about your plans? How much are you planning on saving for college? How much are actually able to do right now? On a side note, how much do you think parents should help with college?