How To Budget For The True Cost of College

Budgeting for college



3 years ago | 9 min read

Every high school student knows full well: College is expensive. And paying for it has become one of the biggest economic problems in America today. At the average private college, the sticker price for tuition, room, and board is $199,500 for the standard 4-year degree And $87,800 for a public 4-year institution (in-state rate).

Higher education can open doors in terms of having increased earning potential, but the cost of getting a college degree can also mean years of student loan payments. So when it comes to understanding what college costs, it’s important to understand exactly what makes up the bill--and how to keep that cost manageable to limit student debt.  

Many overlook the fact that the real price of college education is much higher than the sticker prices of college. In order to weigh the true cost of attending college, you have to take quite a lot of different factors into consideration. There are hidden costs of college that can have a dramatic impact on how much you actually end up paying back.

We’re here for you with these tips to plan out the best way to pay for college for you

Calculate your expenses

Colleges are required to calculate and publish a cost of attendance (COA), which approximates what it will cost you to attend a school for one year. Tuition, fees, and room and board are typically the largest categories, but colleges can also estimate costs such as books, supplies, transportation, and personal expenses. Every college estimates its own cost of attendance—you can think of it like an average budget.

This price often means very little. Which is why it’s important to calculate the net price. 

Net Price

The price you care about is called the net price. This is the actual cost you need to pay in a year to cover education expenses for you to attend a particular college or career school.  You might cover this cost from your savings, with money you earn, student loans, or Income Share Agreements.

First, check the school's net price college cost calculator to see whether you may be able to lower the sticker price with financial assistance from the school. Factor in average tuition, room and board, fees, and financial aid awards, so you can get an estimate of what you can expect to pay at a given school.

Include additional costs like these:

  • Textbooks and school supplies. Course materials could eat up a large chunk of your budget. The average estimated cost of books and supplies for in-state students living on campus at public four-year institutions in 2016-2017 was $1,250, according to the College Board
  • Room and board. When it comes to food and living arrangements, weigh your options. Compare the cost of living on campus and getting a meal plan versus renting an apartment and shopping for groceries.If your school is near your parents house, it may be worth continuing to live with them to save money. 
  • Transportation. Will you take a bus, bike or walk to and from campus or work? If you have a car think of gas, insurance, and maintenance costs.
  • Clothing. Budget for clothing
  • Discretionary spending.  Leave room in your budget for fun stuff like entertainment, eating out, and social activities.

You also need to figure out how much money flows in and out. NerdWallet’s free budget worksheet is a good starting place.

The U.S. Department of Education maintains a College Scorecard, a good tool to use if you want to better understand the cost of earning a degree and more. You can look up the school you’re considering and learn about the average debt after graduation and an estimate of the typical monthly loan payment. You can also get other useful information about specific college expenses, including programs, costs, graduation rates, and average salary after completing a degree.

Think About Your Career further down road

It’s important to do your research so you’re able to accurately estimate the actual amount you’ll have to pay to attend the colleges you’re considering. It’s equally important to consider whether you personally are making a wise investment when choosing a school and program of study, especially if you are borrowing to finance your education. 

One reason for this is that some professions simply have more earning potential than others, and the more you earn, the easier it will likely be to repay any debt you have after graduation. In addition, some schools do a better job than others of preparing students for a career, which can help you get the job you need to repay your debt. 

Therefore, when you consider colleges, you may want to think about whether your degree will help you pay back the amount of debt that you need to take on to finance your education. 

Here are some examples of what college could really cost you based off of your degree:


The Average Salary for orthodontists is $229,380. Most dental programs require a 4-year bachelor’s degree with pre-dental courses like chemistry, biology, and physics. Graduate dental programs are 4 years and include classroom and clinical experience. After the dental program is completed, a 3-year orthodontic specialty program is required. (

Your cumulative educational expenses for an Orthodontist degree at NYU (undergrad + dental school +residency), including living expenses, come out to $1,175,283. Even if you’re able to cut down on your average living expenses by $175K during your 10+ years of school, you’re still taking out one million dollars to become an orthodontist.

And don’t forget, your unsubsidized loans have likely been accruing interest during your 7 years of graduate education. With current interest rates at the time of writing this post set at 5.31% (Direct Unsubsidized), 6.31% (Grad Plus) for graduate students, and 3.76% (Direct Unsubsidized) for undergraduate students, a significant portion of your monthly income will go to paying off your student loans.


The median annual wage for veterinarians is $93,830.

Average College Requirements: In addition to an undergraduate degree (highly recommended), veterinarians must have a Doctor of Veterinary Medicine degree (DVM or VMD) from an accredited veterinary college (typically 4 years), as well as a state license. 

Average Tuition Cost: The typical cost over four years for a veterinary degree ranges from $147,000 to $250,000 for in-state resident tuition at a public institution. (VIN Foundation) Add this to the cost of a 4-year undergraduate degree ($95,560) for a total estimated tuition cost of $242,560 – $345,560.

Athletic Trainer

The median annual wage for athletic trainers is $47,510. Athletic trainers typically need a bachelor’s degree in athletic training and to successfully pass the Board of Certification (BOC) Exam. Some employers also require a master’s degree. The average annual out-of-state cost for a bachelor program in Athletic Training is $37,671. Over 4 years, the total estimated cost is $150,684 (College Calc)

Now that you know how to best estimate the price you’ll pay for college, think about how exactly you’re going to pay for it. 

Apply For Scholarships

If applicable, student scholarships are an amazing way to take some of the load off your college tuition. When applying for colleges, check out what scholarships are available and whether or not you qualify. 

Scholarships should be at front of mind when thinking about how to pay for college. You could end up with a four-year full-tuition offer. These 10 online scholarship search tools can help you find scholarships to pay for college. There are thousands of private scholarships out there from companies, nonprofits, and community groups. You can receive scholarships for everything from academic and athletic achievement to community service or your unique personal background. 

You don’t have to wait until you’re a senior in high school to start your scholarship search either. In fact, it could pay to start earlier. For example, the Evans Scholars Foundation awards full-ride scholarships to hundreds of golf caddies each year. But you have to be a caddie for at least two years to qualify, which means you’d have to start caddying during your sophomore year in high school at the latest to be eligible by the time you apply at the beginning of your senior year.

It’s also important to keep applying for scholarships even while you’re in college or a public university. You can get funding to help cover books, housing, and other costs, even as a sophomore or junior. Some examples of scholarship categories include academic, athletic, for minority students, military families, writers, and so many more. There are many scholarships out there, including the College Ave $1,000 monthly scholarship.

Know your student loan options

For many students, it’s difficult to avoid taking on loans. Loans should be your last resort, but they're often inevitable if scholarships, grants, and savings don't cover the entire bill.  Federal Student loans, issued by the government, are categorized into two types for undergraduate students: direct subsidized (based on financial need) and direct unsubsidized loans (not based on financial need).

Remember that when opting for student loans, you will have to pay back everything you borrow plus interest. Most people don’t know the  impact student loans can have on your finances. In fact, 90% of Americans don’t know how long it takes to pay off student loans. Federal student loans do have annual and lifetime limits, putting a cap on how much you can get through federal loans alone. 

Federal loans have fairly low interest rates, which often do not exceed the single digits. As reported by at the time of writing, loans first disbursed on or after 7/1/20 and before 7/1/21 have the following interest rates:

  • Direct Subsidized (undergraduate): 2.75%
  • Direct Unsubsidized (undergraduate): 2.75%
  • Direct Unsubsidized (graduate or professional): 4.30%
  • Direct PLUS: (parents and graduate or professional students): 5.30%

Long after you graduate college student loans can affect credit score. However, since payment history and length of credit play an important role in credit score calculations, those who pay back their student loans in a timely manner should see a positive credit impact. Estimate the amount of student loan debt you will owe upon graduation and come up with a payment plan on how you will pay it back ahead of time so you can avoid any bad credit.

Consider Income Share Agreements

Income Share Agreements (ISAs) have emerged as a great way to help cover some of the costs of college. With an ISA, the student will pay back a percentage of their income for a set period of time after graduation. Unlike a traditional loan, there’s zero interest, and there are added protections to help in the case that the student loses their job or is making less than the Minimum Income Threshold

Some schools, like Purdue University, help students set up ISAs as a form of student aid. Many agreements are capped at 10% or 15% of income, ensuring students can make their payments. Although not every school offers an ISA you can check out this list of some schools who do offer them.

Be sure to research your options and, since ISA terms vary, make sure you know exactly how much you could be paying back. Income Share agreements can be more beneficial for certain career paths over others.

ISAs are emerging as a great way to help fund your education. There are many schools beginning to offer them and some private companies may provide you with an ISA to help cover the costs of your school. Think your school should offer an ISA? Let us know here.

Other helpful resources

The bottom line: college is expensive, but there are ways to ease the burden of college costs. We’ve rounded up some of the best resources to help you prepare your finances for college.

Buying or renting books




Student Loans



Thinking about budgeting as a college student often goes beyond the sticker price. Paying for books, rent, supplies, meals, and more will make the true cost of college more expensive than you anticipated but it doesn't have to be that way. Do your research, create a cost sheet, and break down what your real cost of college might be. Then, consider how you might plan on paying those costs post-graduation. If you need a good place to start, check out these college-cost projectors. School might be costly, but the better you can prepare, the less you'll be stressed when you graduate.

Although every effort has been made to provide complete and accurate information, Meratas Inc. makes no warranties, express or implied, or representations as to the accuracy of content contained herein. Meratas Inc. assumes no liability or responsibility for any error or omissions in the information contained herein or the operation or use of these materials.


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