When planning for higher education, you might be surprised to discover that college tuition and fees are not necessarily the largest associated costs. As students begin this next phase of life, taking a look at the college’s published cost of attendance is a good idea. These are estimated costs (usually produced in conjunction with the University) that change depending on the student’s chosen major, classroom curriculum, campus activity, and personal lifestyle.
A recent survey of current college trends reported hidden costs beyond tuition could easily exceed more than $3,000 to $5,000 a year per student. Unplanned or unexpected costs directly related to education include:
- Admission tests and applications
- Classroom materials and textbooks
- Dropping classes or registering late
- Extra classes or specific major study sessions
- Lab and tutoring sessions
- Per-use charges for campus amenities
- Post-undergraduate or licensing exams
- Sorority and club membership fees
Today, over 60% of U.S. undergraduates attend four-year universities, with less than 40% attending community colleges. Tuition and fees account for 40% of four-year college costs for in-state students living on campus. That leaves 60% of an estimated budget to cover the cost of college life and study regimes.
In some cases, undergraduates apply for grant aid to cover the non-tuition expenses. Unfortunately, grants might only cover a small portion, leaving the student responsible for the reminder. Individual lifestyle expenses each month can cost $50 to $200, or in some cases much more. The majority of these non-tuition personal living expenses associated with attending college could be overwhelming to an underestimated budget. In order to make ends meet, some students may find it necessary to get a part-time job.
Student Daily Living
When putting your budget together, it is crucial not to forget daily living expenses that can quickly add up. This may include:
- Cable/satellite TV/cell phone
- Replacing damaged or lost property
- Housing and dorm furnishings
- Meals outside of the meal plan
- Parking and transportation
- Renter’s insurance
As students leave campus to join family and friends during semester and holiday breaks, these are opportunities for parents and students to review and adjust their budgeted living expenses. It is highly recommended for both the student and parent to be involved in the planning process. These conversations are valuable lessons and offer students an opportunity to manage their own spending budget as they prepare for the future.
Choices, Choices, Choices
Whether the student attends a large university or small college, they will still face the challenge of planning for non-tuition expenses. The choice of attending a large university offering a wider range of degrees, more clubs, greater resources, and access to alumni, compared to a small college with more personalized attention for each student, can ultimately come down to these extra costs. Be sure to think through them carefully before making such an important life decision. Talking to a financial planner is a also a great way to get an objective, outside perspective of what you can realistically afford, and is a great exercise that parents and students can go through together.
This content is developed from sources believed to be providing accurate information. The information in this material is not intended as investment, tax, or legal advice. It may not be used for the purpose of avoiding any federal tax penalties. Please consult legal or tax professionals for specific information regarding your individual situation. The opinions expressed and material provided are for general information, and should not be considered a solicitation for the purchase or sale of any security.