By Janet Stanton Burt
If you have a high school student gearing up for the college search, net price calculators can help your family comparison shop. Accurate calculators can give you a good idea of what each college on your teenager’s list will really cost, after estimating which grants and merit aid she may qualify for.
But use this tool with caution: Even the best net price calculators give ballpark estimates, not guaranteed prices, and not all calculators give equally reliable results.
What Does “Net Price” Mean?
All colleges publish an estimated total cost of attendance, or “sticker price,” that includes everything you might pay for:
- Room and board
- Books and supplies
- Travel and personal expenses
Not everyone pays the full sticker price, though. That’s where net price comes in.
“Net price” is supposed to be the difference between the “sticker price” and what you’ll actually pay after accounting for college grants and merit aid: That is, financial aid you don’t have to pay back.
In theory, net price calculators let a family compare projected colleges by cost before a student applies. You might see which colleges are likely to be financially generous, or stingy, to your student. That pricey, private college could potentially cost less than a public university, if the private school offers (and your student qualifies for) a large grant and generous merit aid.
Not happy with what you’re seeing from net price calculators? It’s not too late to set an education savings goal to give your child more choices.
How to Spot an Accurate Calculator
Unfortunately, not all net price calculators are created equal. You’ll get more accurate net prices from calculators that:
Ask at least 10 questions.
To generate an accurate net price, a good calculator will ask about:
- Your finances, including taxes, income and investments.
- Your student’s finances.
- Student performance measures like GPA, test scores and activities (used to project merit aid).
When you answer those intensely personal questions, tell the net price calculator the truth. If you fudge, you’ll get skewed results.
Use current costs.
Make sure the calculator uses the most recent tuition and room and board costs. Many calculators use data that’s a couple of years old, and college prices typically head in only one direction: up.
Are easy to find.
The net price calculator should be readily accessible on a school’s site. If it’s buried deep in the website or missing entirely, proceed with caution, it could signal a particularly high net cost (or just a disorganized website).
If you have trouble finding a college’s calculator, locate it via the U.S. Department of Education’s Net Price Calculator Center.
A Few More Red Flags
Be wary of projections that highlight terms other than net price.
When a school refers to “out-of-pocket costs” or “estimated remaining costs,” look to see how it arrived at the number it’s giving you. Some colleges fold loans and work-study awards into these figures to make the college seem more affordable.
Net price doesn’t include loans because loans don’t reduce college costs.
Watch out for front-loading.
Colleges bait their hooks with lots of grant aid to lure freshmen to attend. In later years, the grants may dry up, leaving you with a much bigger college tab.
Net price calculators can’t predict this practice. Read the financial aid letter that comes with (or shortly after) the acceptance letter. It says what you have to do to keep receiving grants and merit aid.
Net price calculators won’t help these students:
- Students looking at out-of-state public universities. If you’re not asked if you qualify for in-state or out-of-state tuition, you can bet the net price calculator assumes you’re paying low, in-state tuition rather than much higher out-of-state tuition.
- International students, most of whom don’t qualify for any financial aid.
Your Results May Differ
Merit aid and grants are subjectively awarded prizes. While some schools happily disclose the specific dollar amount given to all students with SAT scores above X and high school GPAs above Y, others don’t share that information until they actually make your child an offer. Your child’s high school guidance counselor may be willing and able to tell you what kids have gotten in past years.
So even when a net price calculator says you’ll get grants or merit aid, remember that it’s an estimate, not a promise. You can’t know exactly how much financial aid your student will get until she’s actually applied to college and filled out the financial aid forms, including the FAFSA (or Free Application for Federal Student Aid), and for about 300 elite colleges, the CSS Profile form. Once she’s in, the school will put the offer in writing and you can compare all the offers.
Despite these caveats, net price calculators can be a good starting point for comparing colleges by cost. Try experimenting with net price projections before your teenager falls in love with specific schools. That way, you can focus on colleges that fit into your overall college financial plan.
Wherever your family is in the college search process, Goal Investor’s college savings tool will help you set a realistic savings plan to help cover college costs once they arrive.
This information is provided for education purposes only and is not intended to provide legal advice. SEI does not claim responsibility for the accuracy or reliability of the data provided.