$100k
Choosing a college has become a six-figure decision. Unfortunately, many families assume they’ll pay much less because the primary cost of instruction — tuition and fees — can be far less than the “Cost of Attendance“, an official estimate created by each college that also includes room & board, books, travel and miscellaneous expenses for an average full-time freshman. That’s why I prefer to talk about Cost of Attendance (COA) with families, because no matter where junior goes to college, he’ll need to eat, sleep, buy or rent books, come home for the holidays and order the occasional pizza for a late-night study session.

Here’s how COA breaks down for four Midwestern colleges:

Institution Tuition & Fees Room & Board Books Travel Misc. COA Tuition as a % of COA
UW-Madison $10,436 $10,446 $1200 $800 $2296 $25,242 41%
UW-La Crosse $9227 $6155 $0 $800 $1750 $17,932 51%
University of Iowa $28,638 $10,108 $950 $608 $1634 $41,938 68%
Beloit College $46,596 $8126 $1000 n/a $1300 $57,022 82%
Tuition & Fees and room & board are classified as “direct expenses” because you pay these directly to the institution. You may buy books directly from the campus bookstore although most students find them elsewhere, and that’s why the other three categories are “indirect expenses” and can vary more.

A quick glance at the chart above reveals a few things:

  • None of these is cheap although some may be more affordable than others.
  • UW-LaCrosse tuition includes textbook rental, a pretty sweet deal which means you’re not stuck re-selling Intro to Psych for pennies on the dollar after finals.
  • Badgers spend more on miscellaneous things than Hawkeyes, Eagles or Buccaneers. Must be something about State Street…
  • Since Beloit College doesn’t provide a travel estimate, they must assume that all students live within walking distance or can employ “beam me up, Scotty” technology to reach campus. I’d actually bet on the latter given that no college in America has more students who come from 500+ miles to attend college.

So how can you use these numbers to better understand and plan for the cost?

  1. When you consider the options, it’s smart to budget for or at least recognize that tuition is only one part of the equation.
  2. Whenever possible, compare COA to COA.
  3. Look beyond sticker price to find value.
Whichever numbers you choose to focus on, keep in mind that the actual cost of college is much more complex. (In a later blog I’ll run these numbers through my Total Cost of College formula to shed more light.) We’ve been talking about the cost of one year, but one year of college doesn’t get you very far in the door when you’re looking for a job. You need a degree, which takes more time and more money…and here’s where it’s going to sting.

The national six-year graduation rate is an abysmal 59%.

“What? Six-year? I thought college was supposed to be four years…?” That’s correct: colleges use six years and not four as “on time” which is disturbing. I have yet to find a reliable source for the national four-year graduation rate but two excellent resources are College Board’s College Completion and College Results. Both let you search by institution and also make comparisons with similar colleges or by state. College completion is a hot topic in higher ed (and yet another topic for an upcoming blog) because students are taking longer to graduate, which keeps them out of the workforce longer (and delays their ability to pay taxes), and because those attending public institutions are receiving the benefit of state taxpayer subsidies throughout their college career. Here are graduation rates for these four according to College Results.
Institution
4-year graduation rate
5-year graduation rate
6-year graduation rate
Beloit College
71%
78%
78%
UW-Madison
55%
80%
83%
University of Iowa
48%
67%
70%
UW-LaCrosse
36%
63%
67%
But maybe your kid is bright and is currently stock-piling AP credits and will walk onto campus as a second semester freshman if not a sophomore. Well done! If I’ve said it once, I’ve said it 1000 times:

The best way to control the cost of college is to control the number of semesters.

So let’s multiply those COA figures by time to degree.
Institution
3-1/2 years
4 years
4-1/2 years
UW-Madison
$88,347
$100,968
$113,589
UW-LaCrosse
$62,762
$71,728
$80,694
University of Iowa
$146,783
$167,752
$188,721
Beloit College
$199,577
$228,088
$256,599
While it’s true that there are some programs which are designed for five years, the vast majority of majors or even double majors can be completed within four years. So we’re back to the title of this blog…

A college degree at UW-Madison will cost you $100,968…if you’re lucky.

A better bet is you’ll need 4-1/2 years, which amounts to $113,589. Beloit is much more likely to get you out in four but it will cost almost a quarter-million dollars (it’s scary just to type that with the word “million”). Or will it? These are very rough estimates and no, I haven’t accounted for cost savings measures such as moving off-campus and eating ramen noodles, but the biggest factor that will impact cost is financial aid which comes in both need-based and merit-based forms.

The power of merit aid

Let’s assume you’re a middle-income family living in Dane County. Unless there are extenuating circumstances, you won’t qualify for any need-based aid from any of the public universities in our list but you may qualify for aid at a private college which uses a “higher sticker price, high discount” pricing model. But what can really make the difference is merit aid, i.e. money given by the institution to students in recognition of academic and extracurricular performance without respect to demonstrated need. (Many people refer to these as “scholarships” and that term is correct, but it’s also used to denote private awards such as a $500 scholarship from the Rotary Club.)

“Just for you, I’m gonna knock $100k off the sticker price…but I gotta talk to my manager first…”

If your student has a 3.5 GPA or better, she isn’t likely to qualify for merit aid at Madison (and probably won’t be accepted), or at La Crosse or Iowa. Public universities are “low sticker price, low discount” and merit aid is extremely limited. Private colleges, however, do award merit aid on a regular basis because they have to just to be competitive. Beloit offers a Wisconsin Distinguished Scholars Award for incoming freshmen with a 3.5 GPA, and since Beloit is test-optional, there is no requirement for a corresponding ACT or SAT score. The award is $25,000 annually and is renewable for all four years, so you just lowered the sticker price by $100,000. So now our apples to apples comparison is $113,589 for 4-1/2 years at UW-Madison versus $128,088 for 4 years at Beloit, before any need-based aid, which you’re much more likely to receive at a private college.

But what about UW-La Crosse? Isn’t that the cheapest option?

Yes, on paper it’s the least expensive of these four, even if you love the river and the bluffs so much that you decide to spend five years there. I think UW-La Crosse is a fabulous college…but is it fabulous for you? Before you go college shopping, I recommend you take a step back to build the University of You — a custom, one-of-a-kind, perfectly tailored model of everything you want and need from a college experience. That involves a lot more than “I want a really big school because I go to a big high school”, or doing a search to see if they offer your major (most colleges offer most majors). There are questions you need to ask that aren’t always apparent.

Choosing a college is a process not an event

You need to go beyond the surface and find out what a college is really like, what its people are like, what unique programs they offer, how long it takes to graduate, what their job placement rates are…and what the actual costs may be. This is exactly the work I do with families in my University of You College Search programs. It’s not easy but it’s worth the time, effort and cost (usually less than 1% of what you’ll pay for your degree) to find your perfect University of You, because that’s the only place where you can truly reach your potential. If you’d like to hear more about how I help families navigate the college planning process, you can contact me or schedule a free one-hour strategy session to get the conversation started. In the meantime, tell Bucky you’re still interested but need to dig a little deeper before committing to a long-term relationship (like 4-1/2 years).