By Mary Anne Busse
Managing Director, Great Disclosure LLC
July 20, 2015

When I went to college, there was no such thing as a College Cost Calculator.  We just knew that some schools were more expensive than others and hoped that a combination of scholarships, grants and loans would get us through.  Sometimes I think we may have been better off not being able to calculate the expected cost of college – a College Cost Calculator can be a scary thing.

Today, the college cost calculator can scare parents of younger children into thinking that college is not attainable.  Recent data from the National Center for Education Statistics shows the most expensive schools in the country topping $49,000 a year for tuition and required fees!  Using the College Cost Calculator that CSPN offers, assuming my seven year old attends private college for 4 years and costs rise 5% a year on average, I’ll be expected to pay over $316,000! That’s enough to scare even an avid saver!

But, I’m determined to not let the headlines or calculators scare me into taking no action at all.  I’ve decided to use them to my advantage.  Looking further into the new data from the National Center for Education Statistics , tuition and required fees for 4-year public schools can be as low as around $1500 a year with a national average of $7,617.  Using the College Cost Calculator again, assuming my seven year old will attend a 4-year public school and assuming a 5% rise in costs annually, my cost drops to $142,000.  Now, these are numbers I can deal with – still big numbers, but much more manageable!

As I began planning plan for my daughter’s college years, of course I decided to save through a tax-advantaged 529 plan.  I assessed the goals I had for my daughter, looked at my budget, used the College Cost Calculator, figured out what I could cut from the budget (my overpriced $5/day cup of coffee habit turned into an extra $100/month I’m saving for my daughter’s education!) and took the plunge.  Do I have everything saved?  Absolutely not!  Do I think I’m going to save enough? With disciplined dedication to the goal – sure – maybe not for the most expensive school in the country – but I don’t want her to go that far away from home anyhow!

Don’t let the headlines fool you.  Your child doesn’t have to go to the most expensive school in the country.  You don’t have to take out a second mortgage to afford higher education for your kids. Your children may not attend the least expensive school in the country either.  But somewhere in the middle, they will get a great education with some help from you and your 529 plan account.

About the Author
Mary Anne Busse is the Managing Director of Great Disclosure LLC, a full service consulting firm dedicated to the 529 Plan marketplace.  Great Disclosure represents 529 Plan administrators on all aspects of 529 Plan administration, marketing, and operations.