Project the future cost of college based on today's annual cost, years until enrollment, expected tuition inflation, and years in college.
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Projected First-Year Cost = Current Annual Cost × (1 + inflation rate)^years until enrollment. The total projected cost then compounds each subsequent year of college at the same inflation rate too, since costs keep rising while your student is enrolled, not just before.
For example, a 25,000 current annual cost with 10 years until enrollment, 5% inflation, and 4 years of college projects to roughly 40,722 in the first year and about 175,313 in total across all four years.
College tuition has historically risen faster than general consumer price inflation in many countries, so a default of around 5% is commonly used for planning purposes, higher than typical 2-3% general inflation estimates. Adjust based on the specific institution type you're planning for.
Use whichever most closely matches where your student is likely to attend, current annual costs vary enormously between in-state public, out-of-state public, and private institutions.
No, this projects the full sticker-price cost. Financial aid, scholarships and grants would reduce the actual amount you need to save or pay, factor those in separately.
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