You may want to consider, as an Fortune 500-employed parent, that the College Board publishes new college cost data and trends in its annual report. The published costs are based on a survey of approximately 4,000 institutions across the United States.
Employees of Fortune 500 with children must also account for the fact that, over the past two decades, the average price of tuition, fees, and room and board has increased by 46% at public colleges and 30% at private colleges, putting a strain on the budgets of many families and leading to widespread student debt.
The following are expense highlights for the year 2022-2023.1 This year, public colleges have done a better job than private colleges of limiting tuition and fee increases to less than 2.3%. Includes direct costs for tuition, fees, and room and board in addition to indirect costs for literature, transportation, and personal expenses.
Numerous private colleges have annual tuition and fees at or near $80,000.
Sticker price vs. net price
The College Board's cost estimates are derived from colleges' published price tags. Fortune 500 employees with children should be aware that many families do not pay the full price. Available on every college's website, a net price calculator can help families see beyond a college's label price. It can be a very useful resource for students who are researching institutions and/or applying to them.
A net price calculator provides an estimate of how much grant aid a student may be eligible for at a specific institution based on the student's financial information and academic record, thereby providing families with an estimate of their out-of-pocket cost, or net price. Fortune 500 employees should be aware that the results are not a guarantee of grant funding, but are intended to be as accurate as feasible.
FASFA for 2023-2024 year opened on October 1
Even though the data presented here pertains to the 2022-2023 academic year, it is already time to consider the following year. On October 1, the Free Application for Federal Student Aid (FAFSA) for the 2023-2024 academic year became available. It is crucial to remember that the 2023-2024 FAFSA will consider your income from two years prior, which it will obtain from your 2021 federal income tax return, but it will only consider your current assets.2 Your income is the most important factor in determining your eligibility for financial aid.
According to a study published by Savingforcollege.com on September 29, 2022, it's important for Fortune 500 parents to know that starting a 529 college savings plan can provide tax advantages and help mitigate the rising costs of education. These plans allow parents to contribute after-tax money that can grow tax-free, and withdrawals for qualified educational expenses are also tax-free. Additionally, some states offer state income tax deductions or credits for contributions to 529 plans. Investing in a 529 plan early can give parents more time to accumulate savings and potentially offset the increasing expenses of college education.
Imagine you are an experienced navigator on a journey to an unknown destination. As you guide your ship through uncharted waters, you encounter ever-changing tides and currents. Similarly, Fortune 500 parents embarking on the college planning journey must navigate the dynamic landscape of rising college costs. Just like a seasoned navigator adjusts their course to adapt to changing conditions, parents must carefully consider the college cost data for the 2022-2023 school year. This information acts as a compass, helping them chart a path that optimizes their financial resources while ensuring their children receive a quality education. By studying the cost trends and exploring options like 529 savings plans, parents can make informed decisions and set sail towards a brighter future for their children, successfully navigating the challenges of funding higher education.
1) College Board, Trends in College Pricing and Student Aid 2022
2) U.S. Department of Education, 2022