Saving for College

About this Indicator

A key indicator of college affordability is whether families can save enough money over time to pay for two years of full-time enrollment at public two-year institution or four years of full-time enrollment at a public four-year college. Two investment scenarios (10-year vs. 18-year) are shown for a 529 college savings plan that obtains a five percent rate of return. The amounts of monthly savings can be compared with the national average college savings rate, which was $195 per month for a child aged 13-17 in a middle-income family in 2013.[1]

Data Source

Net price: National Center for Education Statistics. IPEDS: Tuition.

Monthly savings: TIAA-CREF. 529 college savings tool.

Note. This calculation assumes the average net price at a public institution for the state’s median family income; a five percent college cost inflation rate; no current savings; and a five percent rate of return.

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[1] SallieMae. (2013). How America saves for college 2013. Retrieved from https://www.salliemae.com/assets/Core/how-America-saves/HowAmericaSaves_Report2013.pdf