How Parents Can Calculate Net Costs Of College Including Tuition Discounts

December 21st, 2011


Andrew P. Kelly, American Enterprise Institute


Key Points

Six in ten families rule out some colleges because of sticker price, yet many do not know that the “net price” is typically far lower. Stanford’s sticker price for tuition, living expenses, and books is $55,918, while Cal State Long Beach’s is $20,675. But for some low-income students, aid discounts those prices to $4,496 and $3,593 respectively.
To help parents and students make informed choices, the federal government now requires “net price calculators” on college websites. That is a start, but proactively teaching parents–especially those with lower incomes–to think in terms of net price is critical.
An AEI survey found that a majority of parents do recognize a distinction between sticker price and net price after aid when asked to think of the cost for a low-income student. Low-income parents tend to overestimate the net price for their child.


Three corrective measures: (1) generate net prices for the schools students list on financial aid forms; (2) enlist guidance counselors to marshal relevant data; and (3) encourage web developers to create online tools that help to compare net prices across institutions.

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One Response

  1. Yes, it’s vitally important that parents can correctly calculate all the costs, including hidden expenses, of college education. This way, they’re not inadvertently forced into a situation of seeking out a private student loan. Of course, with the world flirting with profound and long-winded global depression, we’re especially worried regarding the student loans default circumstances as well.

    We think that it must get even worse as time passes by, and the spectre of a fully employed (or not) graduate body laboring the rest of their specialist lives away, merely to pay back hefty student loans, involving debilitating interest rates, is the stuff of which horror films are made. Then let’s not talk about all those who fight to locate work, default their student loan and end up lumbered with bad credit scores for the next 7 years, powerless to even scrape together a cell phone arrangement! it’s serious sleeplessness stuff!!

    And if it’s this terrible in the US of A, what’s the diagnosis of those in the land of the Acropolis?

    N E Way, All the best of British luck to you.

    Enjoying the representation of your weblog, just as a side note.

    In the infamous words of our endearing Arnold S, “I’ll be back” (if you’ll have me)

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