Category Archives: Cost saving strategies

Budgeting for Books and Supplies

When comparing the two schools my son is considering, we noticed an interesting data point: one school estimated books and supplies to cost $800 annually; the other $1,146. One of the schools my daughter applied to estimates $1,800. While I can certainly understand that different meal plans or living options might be more or less expensive at different schools, it’s hard to understand why books would cost 50% or 100% more from school to school.

We’re trying to make apples-to-apples cost comparisons, but we’re getting grapefruit and bananas from the schools. Why would they have such different prices? First of all, according to several unnamed sources, these are not numbers that are calculated in any detail. (One former public university administrator said, “We make that up.”) But a big factor is financial aid: students generally can only borrow up to the total cost of attendance, and that includes the school’s estimate of the cost of books and supplies. If school A budgets $346 more annually for books than school B, students at school A can borrow an extra $346, all else being equal.

So how much should you budget for books and supplies? According to the College Board’s Trends in College Pricing, the average undergraduate budget for books and supplies for the current school year is $1,240. But the National Postsecondary Student Aid Study said that students spent $900 on average on course materials and supplies, and the National Association of College Stores said that students spent $484 on course materials, with another $612 being spent on technology and supplies, and that this total has been on a consistent downward trajectory over the past 10 years. That’s a pretty big range, and one thing to note is “supplies” often includes a computer which would definitely tip the scale. But it probably isn’t something you’d buy every year.

One can generally assume that books would cost roughly the same amount for the same major, regardless of schools, which is how you should compare them. Why might there be variances in book costs between schools? Much can depend on the professors. An acquaintance who is a professor at one of our local colleges mentioned she stopped using a textbook because its price went up to $150 and she didn’t think students should have to spend that much. She also mentioned that she, like many other professors, is increasingly using free online resources. At the same time, one of her kids who’s currently in college was assigned an accounting textbook that cost $600. Another factor that can drive costs up: students attending smaller schools in remote locations might have less used books available locally. Then again, there are numerous online options.

If you’re concerned about this cost, reach out to schools directly to find out. Often online syllabi or course catalogs include the books assigned for the class so you can calculate what your specific classes are likely to cost. You can also reach out directly to the academic department to ask, or ask a current student when you visit the campus. And then you’ll want to research how best to get the books you need: buy vs rent, new vs used, campus bookstore vs online, …

To Borrow or Not to Borrow

Planning for college cash flow can be tricky. It’s not just that the average public university costs over $25,000 per year whereas the average family has saved just over $18,000 total. There’s also the combination of tax credits and their attendant rules, a confusing menu of borrowing options, and misunderstandings about how aid formulas treat savings. Add multiple children with overlapping college years and it’s no wonder many parents throw up their hands in despair. One common theme I hear from parents is a version of, “We’ll just spend our savings until it’s gone and then borrow what we need.” This may or may not be the right answer. Continue reading To Borrow or Not to Borrow

AOTC And New Tax Law

One of the big changes to the tax bill was making our young adult children less valuable to their parents from a tax perspective. The dependent exemption is gone and the child tax credit for 18- to 23-year-old dependents is only $500. The change does open a door to higher-income families for the American Opportunity Tax Credit, though.  The AOTC phases out at MAGI of $160,000, so it’s not unusual for families to be ineligible but to still find college unaffordable.

Here’s how the AOTC works, from irs.gov: Continue reading AOTC And New Tax Law

College Prep by Grade

I gave a financial aid talk to college and career center volunteers at our high school recently. One question stood out: “This is a lot of information to absorb at once. Can you break it down into some specific suggestions by grade?” Two ideas are important here: College planning is a process that should start well before senior year, and there are things that can be done at any point to make things go more smoothly when the time comes to start applying. So here goes. Continue reading College Prep by Grade

Honors Colleges, Dual Enrollment and Majors

Apologies for my recent absentee-ism. Between our (hopefully) last college visit and my nephew’s wedding, it’s been a busy couple of weeks here!

Our hopefully last college visit was with both kids at our in-state flagship school. My son loved it; it’s where he was already intending to go and the visit really confirmed that, as well as increasing his excitement about being there next fall. Looking at it from his perspective, the visit increased my happiness about the circus-free nature of attending Continue reading Honors Colleges, Dual Enrollment and Majors

FAFSA Asset Do’s and Don’t’s

It’s the busy season for insurance and annuities hucksters who tell parents of college-bound students that spending their assets to buy an insurance policy will yield all manner of financial aid benefits. Before you start making expensive moves that end up costing more in the long run, you should figure out what will really benefit you. Continue reading FAFSA Asset Do’s and Don’t’s

EFC, Net Cost and Aid Packaging

Step 1 in figuring out how to pay for college is estimating your EFC. You can use the FAFSA4caster, or the more detailed EFC Formula Guide (note that’s for 2018-2019; the 2019-2020 version should be released this month). But EFC is just a starting point: schools aren’t required to meet your need, and they certainly aren’t required to meet it through gift aid. That’s why net cost and aid packaging are important concepts to understand. Continue reading EFC, Net Cost and Aid Packaging

Need-Blind, No Loan, 100% Need Met Policies

On our recent college odyssey, we heard about a lot of need-blind admissions policies, and no loan/100% of need met financial aid policies. These are mostly good things but perhaps not as good as they sound on the surface, so it’s worth unpacking them. Continue reading Need-Blind, No Loan, 100% Need Met Policies