Save money on college just by opening your email
Talk About College Money Before You Talk About Dream Colleges
There is a conversation many families wait far too long to have.
It usually happens sometime during senior year.
A student has applied to several colleges. The acceptance letters begin arriving. There’s excitement around the kitchen table.
And then someone finally asks:
“Wait. How much is this actually going to cost?”
That’s when the mood can change very quickly.
Because choosing a college isn’t only an academic decision.
For many families, it may be one of the largest financial decisions they’ll ever make.
So we’d like to suggest something different:
Have the money conversation early.
Freshman year isn’t too early.
Sophomore year isn’t too early.
And you don’t need exact numbers or a detailed financial plan to begin.
You simply need to start talking.
Why Call It the $100,000 Conversation?
Because the difference between two college choices can easily amount to tens of thousands of dollars over four years—and sometimes $100,000 or more.
Consider a simplified example.
One college ultimately costs your family:
$25,000 per year
Another costs:
$50,000 per year
Over four years, that’s roughly:
$100,000 vs. $200,000.
That’s a $100,000 decision.
And here’s what makes college pricing particularly confusing:
The school with the higher published price isn’t necessarily the school that will cost your family more.
Welcome to the strange world of college pricing.
Sticker Price Is Not the Same as Your Price
When you look at a college website, you’ll see a published cost of attendance.
That can include:
- Tuition and fees
- Housing
- Food
- Books and supplies
- Transportation
- Personal expenses
The total can be startling.
But don’t immediately eliminate a college because of that number.
Depending on the school and your family’s circumstances, financial aid and scholarships may significantly reduce what you actually pay.
That’s why families need to understand the difference between:
Sticker Price — the published cost.
and
Net Price — approximately what your family may pay after certain grants and scholarships are considered.
The second number is much more useful.
Find Out What Colleges Might Cost Your Family
You don’t have to wait until senior year to get an estimate.
Colleges that participate in federal student-aid programs are generally required to have a Net Price Calculator on their websites.
Parents can enter information about their family finances and student to receive an estimate of what attending that college might cost after estimated grant and scholarship aid.
It’s not an actual financial-aid offer, and circumstances can change.
But it’s an excellent planning tool.
Try it with several different colleges.
You may be surprised by the results.
Parents: Decide What You Can Contribute
This can be uncomfortable.
Have the conversation anyway.
Parents should begin thinking about questions like:
How much can we realistically contribute each year?
Do we have college savings?
Will we pay for all four years, part of college or a specific dollar amount?
Are we willing to borrow money?
Do we expect our student to contribute?
There isn’t one correct answer.
Every family’s financial situation is different.
What’s important is that your student understands the general parameters before making a college list based entirely on emotion.
Imagine hearing throughout high school:
“Work hard so you can go anywhere you want.”
Then imagine being accepted to your dream college and hearing:
“We can’t afford for you to go.”
That’s a painful conversation.
It’s also one that earlier planning can sometimes prevent.
Students Need to Be Part of the Conversation
College finances shouldn’t be a mysterious adult conversation happening behind closed doors.
Students don’t need every detail of the family finances.
But they should understand enough to make informed choices.
Talk about:
- What college costs
- What your family can reasonably contribute
- Scholarships
- Grants
- Financial aid
- Student loans
- Working during college
- Community college and transfer options
- In-state versus out-of-state costs
- Different pathways to the same career
This isn’t about frightening students.
It’s about empowering them.
Understand the Major Ways Families Pay for College
Most families use some combination of several resources.
Family Money
This might include current income, savings, a 529 plan or contributions from relatives.
Grants
Grants are generally financial aid that doesn’t have to be repaid. Many are based on financial need.
Scholarships
Scholarships may be awarded for academics, talent, leadership, community involvement, athletics, career interests, personal circumstances and many other qualifications.
Some come from colleges themselves. Others come from private organizations, foundations, employers and community groups.
Student Employment
Some students work during summers or the school year and use part of their earnings toward college expenses.
Federal Work-Study may also be included in some students’ financial-aid packages.
Loans
Loans are borrowed money.
And borrowed money eventually becomes real monthly payments.
That’s why loans should be understood before they’re accepted—not simply clicked on because they’re included in a financial-aid offer.
Start Talking About Debt in Monthly Payments
Here’s one of our favorite ways to make college borrowing more understandable.
Don’t only ask:
“How much would you need to borrow?”
Ask:
“What could that mean every month after graduation?”
A teenager may have trouble understanding what $40,000 of student debt will feel like five years from now.
But this is easier to understand:
“Part of your paycheck every month for years may already be committed before you pay rent, buy groceries, travel or save for a house.”
Now we’re talking about something tangible.
Debt doesn’t automatically make a college a bad choice.
But students should understand the tradeoff they’re making.
Scholarships Should Be Part of the Plan—Not the Entire Plan
We love scholarships.
Obviously.
But families shouldn’t build a college plan that only works if a student wins enough outside scholarships to fill a huge financial gap.
Instead, build a financially realistic college list first.
Then use scholarships to make that plan even better.
And don’t wait until senior year to begin learning about them.
Students can spend high school learning what opportunities exist, developing strong academics and activities, keeping track of accomplishments and applying for opportunities for which they’re eligible.
Scholarship searching becomes much easier when it isn’t a senior-year emergency.
Build a College List With Three Questions
When the time comes to seriously consider colleges, every school should pass three tests:
1. Can I get in?
Is the school academically realistic based on my grades, courses and other admission requirements?
2. Do I want to go there?
Does it offer the academic programs, environment and opportunities I’m looking for?
3. Can we afford it?
What might this college realistically cost our family?
That third question belongs beside the first two.
Not underneath them in tiny print.
The Goal Isn’t the Most Expensive College
And it isn’t necessarily the cheapest one, either.
The goal is to find a college that offers the right combination of:
Education + Opportunity + Fit + Affordability
Sometimes an expensive private university becomes surprisingly affordable because of institutional aid.
Sometimes the nearby public university is the smartest financial choice.
Sometimes community college followed by a university makes tremendous sense.
Sometimes a student receives a significant merit scholarship that completely changes the equation.
There are many good paths.
Have the Conversation at the Kitchen Table
You don’t need spreadsheets covering the dining-room walls.
Start with dinner.
Parents, try saying:
“We want you to have wonderful options after high school. We also want to make sure we’re making smart financial decisions together. Let’s start learning what college actually costs and what we might be able to afford.”
That’s it.
You have officially started the $100,000 conversation.
Keep having it as your student moves through high school.
The numbers will become clearer.
Their interests will change.
Your family’s circumstances may change.
And eventually, you’ll build a college list together.
One Last Thought
Talking about money doesn’t limit a student’s dreams.
It gives those dreams a plan.
The worst time to discover that a college isn’t financially realistic is after your student has been admitted, bought the sweatshirt and mentally chosen their roommate.
Start earlier.
Learn how college pricing works.
Talk honestly about what your family can contribute.
Search for scholarships.
Compare options.
Ask questions.
Because when you’re potentially making a six-figure decision, a little planning can make an extraordinary difference.