As I covered in Part 1 of this series, what any given college will cost your family seems like an equation brewed by an evil wizard, written on decrepit scrolls in dead languages, and buried under the deepest ocean, such that you can only figure out the true cost of the expedition by looking in the rear view mirror at the end of it all. And that’s not the way a good buying experience should be. Similar to being able to use Consumer Reports to get an estimate of the true 10 year cost of ownership of a vehicle, stacked with Kelley Blue Book to know how much you should be able to bargain the car dealer down to, it should be possible to determine your true cost college up front.

Doing so is possible. And with some help along your journey, it won’t even take a pile of gold or an ocean crossing, although you may feel like you’re learning a foreign language.

Your college selection and funding journey will have a number of waypoints. Let’s start by highlighting them.

1. Have children.
2. Find out how much colleges think you can pay.
3. Calculate how much your family can actually afford.
4. Search for schools that meet all of your criteria.
5. Find out your out of pocket costs for all 4 years.
6. Calculate the loan pain.
7. Timing.

Let’s elaborate:

Have children.

Okay, this one seems silly, but I included it so I can point out that these don’t actually have to be YOUR children. If you are the comfortably situated aunt with cats to dote on instead of children, maybe you have some nieces or nephews you wish to help out with college. Or maybe you are the grandparent, who looks at their retirement assets and knows they have more than they need for themselves, and would rather help their family out ahead of leaving them an inheritance.

Find out how much colleges think you can pay.

Likely, it will feel like a completely unrealistic number. That’s because the current college model it to expect you to pay from the parent and student savings (529 plans and more), the parent and student cash flow (jobs) during college, and the parent and student earnings after college (loans).

Calculate, not just guess, how much your family can actually afford.

This comes in the form of five pieces: parent funds, parent loans, student funds, student loans, and outside help. That outside help is those generous aunties, uncles, or grandparents who may have set something aside for you. Funds are both what has been saved for college funding in advance of beginning college, as well as what can be cash-flowed during college.

Search for schools that meet all of your criteria

Including which ones will be the most generous with their financial aid. By manually searching websites, you might spend hours PER school trying to find this information, and you might overlook colleges that would be a good fit. Utilizing curated databases here will make your life a lot easier and save you a lot of time.

Find out your out of pocket costs from the colleges you’re considering, for all 4 years.

This is important, often the year 2-4 costs are significantly higher than the teaser year 1 costs.

Calculate the post-graduation pain, the loans to be paid back.

Calculate the amount of loans that would be necessary to pay for each considered college, and then also compare that to the expected income for your major from that college.

Timing.

All of the pieces from which colleges determine how much they think you can afford, will be assessed four times, assuming a standard 4 year college graduation schedule. Income will be assessed on a prior-prior tax year schedule, while assets will be assessed on ~October 1st (whenever you fill out the form that becomes available October 1st, but realistically it’s usually better to be filling it out sooner than later in hopes of getting granted more financial aid) of the calendar year before the fall semester of the next school year.

Conclusion

Now you know your road map in the college bound process. And that means you’re in a better position to understand waypoint #2, how much colleges think you can pay, in greater depth. That article is coming up next.