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How Much College Really Costs

There are few moments in life more special than watching your graduating high school senior read an acceptance letter from their favorite college. If the student stays with the program and earns a college degree, he or she could receive a huge financial boost. According to Education Pays, a report from the non-profit organization College Board, college grads can earn about a million dollars more than those without a bachelor's degree over a lifetime.

Before your teen starts his or her higher education journey, however, it's important to know how much it will cost. Expenses go beyond a school's tuition and fees. Students also have to consider application costs, supplies, room, board and transportation. As you help your teen plan for college life, here's a guide to help you understand the various expenses you will need to plan for, as well as how to budget for these costs.

Before enrollment
Paying for college starts long before an undergrad arrives on campus. In high school, students are often charged a fee just to apply to the schools of their choice. Application fees are generally between $40 and $70 each, whether the school is a state institution or private university. According to the College Board, a student traditionally applies to at least five schools. This can mean paying for at least $200 in application fees alone.

These costs are steep, but there is relief for qualified applicants. For families who meet certain income limits, their children can apply for a fee waiver. Students who took the College Board's Scholastic Aptitude Test (SAT), and participated in the Fee Waiver Program, could have their fees waived for up to four college applications. For more information, visit the fee waiver section of the College Board's website.

If you're fortunate enough to receive an acceptance letter from the college of your choice, celebrate! But also be prepared to pay a deposit to keep your spot in the class. A review of several public and private college web sites show that typical tuition deposits range from about $100 to $300. Deposits are generally non-refundable, but are applied toward tuition. The date the deposit is due would likely be included with the college acceptance packet. Many schools use the National Candidate's Reply Date of May 1st.

Estimated Costs for applications and deposit: About $300

Tuition, fees, books
According to the Saving for College website, college tuition and fees are, on average, nearly $32,000 total for four years at a public university, and $120,000 total for the same length of time at a private college. This means students at public colleges can expect to pay $8,000 annually, while private college costs average a whopping $30,000 per year. Over the last ten years, these rates have increased about six percent annually, so you can assume that they will increase at a similar rate in the future.

Students who attend public universities that are located in the same state where they live generally receive a lower tuition rate than students who live out of state. To help save money on tuition, consider applying to an in-state college.

Textbooks and school supplies are a separate cost. They'll need to be purchased shortly before or within the first few days of classes. Students spend close to $1,000 per year for these items, according to a US General Accounting Office report. In order to cut costs, consider buying used books or renting them from sites such as BookRenter.com.

Estimated Costs for tuition, fees and books:

Public Colleges - About $9,000 per year
Private Colleges - About $31,000 per year

Housing, transportation and food
Housing costs will obviously be higher for college students who don't live at home. A New York Daily News article reports that the average price for an on or off-campus residence ranges from $7,000 to $9,000 per year.

Once students have paid for housing, they will still have to pay to furnish their living space. Items such as bed sheets, comforters, bath towels, desk organizers, lamps and small appliances can drive total housing costs up another $500.

Many college kids fall into the trap of using a credit card to pay for these miscellaneous items. It's easy to rack up consumer debt during college on these types of purchases, but it could take years to pay off the bills. Read our article on Your Teenagers and their Credit to help your student learn how to become a responsible consumer and save up for his or her purchases instead of using credit.

If a student needs more spending money to purchase a few odds and ends, review our "TIP JAR®" for suggestions from our readers on how to make extra cash. Students can also save money in housing by choosing to live at home and commute to a nearby college.

Along with housing comes food. Most colleges and universities have meal plans for on-campus students to use campus dining facilities. Some bare-bones plans may offer as few as seven meals a week. Other deluxe-style options could allow students to purchase both hot meals and snacks at convenience store-like locations on campus. Expect to pay roughly $2,000 a year for a "seven meal per week" plan, and up to about $6,000 per year for a "21 meal per week" plan. These fees are often paid by semester, along with on-campus housing fees.

Students also have to factor in transportation costs, particularly if they do not live on campus. The same New York Daily News article reports that undergrads should expect to pay close to $1,000 annually for transportation. These figures do not include the cost parents and other relatives incur when coming to visit.

Optional costs and expenses
In addition to housing, plan to budget for additional school-related activities, such as sorority or fraternity fees, sports, and clubs.

There are also a number of new expenses for high school graduates that may not be unique to college, but should be planned for. They include the purchase of a computer and a cell phone, as well as entertainment costs.

How to Pay
The numbers for college expenses are staggering, but fortunately, most students don't have to pay the published amounts. Many apply for scholarships and grants that can pay for some or even all of their expenses. Contact your student's high school guidance counselor for information on where to find scholarships or grant awards for your undergrad. And don't forget that students may also reduce costs by attending an in-state college that offers lower tuition rates to its residents.

Apart from receiving a scholarship or grant, the next best way to pay for college is with personal savings. If you haven't done so already, open up a 529 savings plan or Coverdell Education Savings Account (ESA) to help save money for college. Even if you don't have long before your student enters college, these savings accounts can still be beneficial. Read College Education Can Cost a Small Fortune to learn about different ways to save for a higher education.

The third option would be financial aid in the form of loans for college students or their parents. Loans may be a necessary option, but be cautious. Students are often saddled with a substantial amount of debt upon graduation. To better understand what type of loan help is available to students, read our article on Financial Aid 101.

The cost of college goes beyond tuition and fees, and the total expense can be several thousands of dollars. However, if you plan ahead and save, your student can afford a college experience and reap the financial benefits over his or her lifetime.

If you liked this you may also like:

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    College tuition is expensive and growing more costly every year. In 2009, approximately 60 percent of students received financial aid to help pay for tuition. Financial aid allows you, as a student, the opportunity to pay for college without making payments until you graduate, with the exception of grants and scholarships. After graduation, you have a six-month grace period for Federal Stafford Loans and a nine-month grace period for Federal Perkins Loans. Even though you do not have to make payments right away, it's important to learn the facts about repayment options and interest rates, so that you won't be making payments at the same time your own kids are starting college.

  • A College Education Can Cost A Small Fortune

    Are you saving money for your child to go to college? College expenses are on the rise, so check out the many savings options available to you.

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