At most private schools, few students pay the list price. A new Forbes tool gives you a quick idea of what your real price might be. Plus, we’ve got advice on the longer process of getting a final financial offer, beginning with filling out the new FAFSA form.
By Emma Whitford & Rina Torchinsky, Forbes Staff
ATthe Hmong College Prep Academy in St. Paul, Minnesota, cost—or more precisely, the true cost of college—is the first thing that counselor Toni Marie O’Daniel talks about with her 400 college-bound juniors and seniors. If the price of a school sounds too high “my kids won’t even apply. They won’t look. They’re freaked out,” says O’Daniel, who warns recruiters from private colleges not to even mention their sticker price. Instead, she drives home this message: “If you have excellent grades, great rigor of classes, excellent GPA, and you’re doing some great things—there are a lot of colleges out there that meet 100% of your (financial) need.” In the case of her students, that need is substantial since 85% of them are poor enough to qualify for free or reduced-price lunches.
Hmong College Prep Academy college counselor Toni Marie O’Daniel helps two students, Taykn Chang (left) and Hideaki Lee (right) with their college search process.
Hmong College Prep Academy
The Hmong students aren’t unusual in their aversion to high list prices. A recent survey of more than 2,000 high school seniors using the college rankings and search website Niche, found that 53% wouldn’t even consider applying to a school with a sticker price over $40,000. Similarly, a new survey of nearly 4,000 high schoolers by the higher education consulting firm Art & Science Group found four in ten students ruled out a college due to price during the winter of their college search—in other words, before they really knew how much any particular school would cost them.
It’s understandable. The nation’s $1.6 trillion in outstanding student debt is scary, as are the published prices of some of the nation’s private colleges. Moreover, figuring out the true cost of a school for any individual student is a daunting process. “There’s lots of survey evidence out there that the only thing that people really understand is the sticker price, and that’s the only number that they’re unlikely to have to pay,” says Phillip Levine, an economics professor at Wellesley College in Massachusetts.
Consider this: According to a report from the College Board, tuition and fees this year at four-year private not-for-profit colleges carry a list price averaging $41,540, but after federal and school grants and discounts are taken into account, the average net tuition undergraduates are paying is just $15,910—a 62% discount. The total cost of attendance (COA) for these schools—a figure that also includes room, board, books and travel—is $60,420, while the net students are paying is $34,790, a 42% discount. That net price average is still a hefty sum for a middle-class family to cough up or borrow and it isn’t very useful when it comes to your college search, since it varies dramatically based on a student’s family income and an individual school’s resources.
That’s why Forbes has created a new tool that allows you to quickly see the average net cost of attendance for your income group at any of the 500 schools on our 2023 list of America’s Top Colleges. Our numbers are based on data collected by the National Center for Education Statistics for the 2021-2022 school year (the latest available) and the five income groupings available in the data. Find your target school and your family’s income bracket from the dropdowns below. Net costs for state universities are for in-state students. One limitation of the data: all families with income above $110,000 are grouped together, when in fact a family earning $120,000 may well get substantial need-based aid at the most expensive private colleges, whereas a family pulling in $1 million would not.
Forbes Top Colleges Net Price Estimator
Use the drop-down menus below to determine the average net cost for someone in your family’s income range to attend one of our 500 top colleges and the percentage of the list price that represents. Results are based on federal data from the 2021-22 academic year. Read more about our tool here.
The point of our tool is to get a feel for your likely costs, so that you don’t rule out (or in) schools unnecessarily. Students from low- and middle-income families may discover, to their surprise, that some of the top private colleges will, on average, cost them less than their state schools. For example, our calculator shows, students from California families with incomes between $48,001 and $75,000 paid $3,637 at #3 ranked Stanford, but had to cough up $14,213, on average, at the University of California, Berkeley, which, at #5, is the top ranked public school on the Forbes list. Maryland students from families with income of $75,001 to $110,000 paid an average of just $12,838 at #13 ranked private Johns Hopkins University, but $21,675 at the University of Maryland’s main campus in College Park, ranked #34.
This, of course, is not the same as your own individual cost estimate, which at some schools factors in such family assets as retirement accounts and home equity, as well as income. Schools that give out merit aid may also ask you to plug your grades and even your test scores into their calculators. Each school is required to offer its own individual net price calculator, and our tool links to the calculator for each school should you be game to try it. But using those calculators requires a lot more information and effort than the Forbes tool. O’Daniel, for one, finds average cost particularly useful as a way for students to get a quick feel for the net cost of a college without waiting on their parents for financial details.
Read more about our tool—and how the schools’ calculators actually work here. Note that even the individual calculators won’t guarantee a specific price. Instead, you’ll have to wait for a financial aid letter in April, after you’re admitted. Unfortunately, those letters themselves are too often misleading and hard to compare.
The College Pricing Game: How It’s Played
To understand the college pricing game, start with the big picture. Levine helpfully splits schools into three categories. The first are highly selective, well-endowed private colleges—think Stanford, the Ivy League and other elite private schools like Amherst College and the Massachusetts Institute of Technology. These schools set high list prices, with the cost of attendance at many topping $70,000 or even $80,000 a year, because “there’s plenty of students who are paying that, and to be quite honest, plenty of students would be willing to pay more than that if they could to get in,” Levine says. But these schools’ endowments—and the high list prices paid by the rich—support huge financial aid budgets, and low- and middle-income students often pay next to nothing to attend. Harvard, with its $51 billion endowment, claims to be cheaper than a public college for 90% of students; undergraduates with a family income of less than $85,000 pay $0 after aid, and families that earn between $85,000 and $150,000 are expected to kick in no more than 10% of their family’s annual income. Princeton, with the biggest endowment in the nation on a per student basis, provides free tuition up to $160,000 of family income, with room and board discounted on a sliding scale up to that level.
The second category of schools are public colleges, which post much lower list prices (at least for residents of their own states) but offer less financial aid. According to the College Board, the average published cost of attendance at a four-year public college is $28,840, while the net COA is $20,310—a 30% discount. They dole out much of their school aid based on need (and some on merit), but don’t have the resources to subsidize room and board the way Harvard or Princeton does. So even for families with income below $40,000, the net COA of attendance at a four-year public college averages $14,610 this year, according to the College Board; for those with income of $120,000 or higher it averages $25,620.
The third, and perhaps most confusing, group of schools are the private colleges below that top tier. These colleges see themselves as competing with state schools for students and with the elite schools for prestige. To do this, they set their tuition high and discount it heavily with institutional need-based and merit aid. “If you put out a sticker price of $45,000, and these other schools that are known to be outstanding institutions have sticker prices of $85,000, you just signaled you’re not as good,” Levine observes. “So you set a sticker price that’s much higher—$60,000, $70,000–and then you give tremendous amounts of merit aid… At many of those institutions, 100% of the students are getting aid, because in reality they’re not shooting for $60,000 or $70,000 per student.”
Start Your Gauntlet With FAFSA
That’s the big picture. Now, here’s the nitty gritty of what you need to do to whittle down your price. First off, to receive any kind of federal grant or loan, you must complete the Free Application for Federal Student Aid. Most schools also require you fill out FAFSA for institutional need-based or so-called “merit” aid, so it’s a good idea to do it no matter your income, experts say. Sean Logan, dean of college counseling at Phillips Academy Andover in Massachusetts, a prestigious and pricey secondary school (tuition and boarding this year runs $69,600, though lots of students get aid), encourages all of his families, even the most affluent, to complete the application.
“We get some pushback when we have families who say ‘Look, we make way too much money to ever qualify for this.’ I say, ‘Great, but we’re still trying to get you to talk with your child a little bit about whether merit aid is something you may want to consider, and then just to make sure they understand the broader [financial aid] process,’” Logan says. Note that merit aid isn’t always strictly about merit—private colleges use it to lure desirable students who don’t have financial need according to the formulas, but whose families would likely struggle to pay the school’s hefty bills or are attracted to the idea of a scholarship. (Those angling for merit aid should aim to apply to some schools where their grades and test scores will stand out.)
At Hmong College Prep Academy, O’Daniel stages special night time sessions to help students and their parents fill out the form. “Last year, I think we had 66% of our families come on one night to fill out the FAFSA,” she says. “And we bring in probably 10 to 15 different financial aid reps and admission counselors to help, especially if they are culturally the same as some of our students to help with translation.”
Even if you or your parents have completed the FAFSA previously, be aware of big changes this year. Because of these changes, the 2024-25 application’s release date has been delayed and is now expected at the end of December. (Students can sign up on studentaid.gov to receive an email when the FAFSA is released. Any current college students returning to school next fall must also fill out FAFSA.) The new form is designed to be simpler—the questions are reduced from 108 to 46. Some families may be able to skip as many as 26 of those questions, supposedly trimming the completion time down to about 10 minutes.
As in previous years, the form automatically pulls in federal tax information from the Internal Revenue Service—it will be pulling your income from your 2022 return. Consent and approval for this process is required to be eligible for federal financial aid, even if a contributor to the form does not have a Social Security number, did not file taxes, or filed taxes outside of the United States. (A contributor is defined as anyone who will sign the FAFSA form—this could be the student, the student’s spouse, a parent, or a stepparent.) In addition, all contributors will need their own FAFSA account and ID—again, a Social Security number is not required to create an account at studentaid.gov.
The new FAFSA comes with Congressionally mandated changes to the student aid formula that will help some families and hurt others. First there’s a change in nomenclature: the old Expected Family Contribution (EFC)—the out-of-pocket expenses a student and their family are expected to pay after federal aid is taken into account—has been replaced by a new metric called the Student Aid Index. (The naming change aims to disabuse families of the idea that the EFC is all they’ll have to pay, since not all schools meet students’ full financial need.)
Among the winners will be an additional 610,000 students from moderate-income families who will be eligible to receive federal Pell grants, which for the 2023-24 academic year maxed out at $7,395. The new formula will take account of family size and allow partial Pell grants for those who don’t qualify for the full stipend.
Big retirement savers could also be winners—the formula will no longer add back into your annual income the contributions you made to a pre-tax 401(k) or IRA. And as with the previous FAFSA forms, the value of your existing retirement accounts and your home equity aren’t counted in your assets.
Among the losers will be upper middle class families with more than one child in college at a time. Under the old system, if a family had two children in college, then the EFC would be spread over both of them, effectively cutting in half the amount the family was expected to contribute for each. (Note, however, that private colleges, when doling out their own institutional discounts, may still take into account the burden on a family of paying multiple tuitions at a time.) Among the other losers will be owners of small businesses and farms, whose value previously wasn’t counted in a family’s assets, but now will be.
Besides Pell grants, the FAFSA form also determines which direct federal loans a student qualifies for. There are two common types of loans offered to undergraduates—direct subsidized loans and direct unsubsidized loans. Subsidized loans are based on financial need and do not accrue interest while the student is in school. Unsubsidized loans are available to all students and begin to accrue interest as soon as the loan is paid out. The fixed interest rate for undergraduate direct subsidized and unsubsidized loans is 5.50% for loans disbursed between July 2023 and July 2024. Undergraduates’ parents, regardless of need, can also tap into direct parent PLUS loans to cover additional educational expenses not covered by other federal aid, but interest begins to accrue as soon as a loan is paid out and at a high rate—8.05% for loans disbursed between July 2023 and July 2024. In addition, Uncle Sam takes a loan origination fee of 4.228% on PLUS loans, compared to the 1.057% fee taken from direct loans made to undergraduates. Parents must begin making repayments immediately, unless they request a deferment.
For Many Private Colleges, There’s Another Form
In addition to the FAFSA, more than 250 private colleges also use the College Board’s CSS Profile form in their financial aid calculations. This extra form— used by schools like Brown University, Duke University, Middlebury College, and Wellesley College—is more detailed than FAFSA and asks students to provide information about additional parental assets, including home equity, retirement and health savings accounts and trust funds. Students with divorced parents should note: some institutions also require non-custodial parents to create an account and fill out the CSS Profile form. Should you get overwhelmed or be missing any of that detailed information, remember that you can save and return to the form at any time.
This year’s CSS Profile was released on October 1. Students are only required to fill it out once, and it will be sent to any participating college the student selects. Families that make up to $100,000 can complete the form for free; those from families earning more must pay a $25 fee for the first school they send the form to, and $16 for every additional school.
Students who have applied to private colleges can expect to receive their financial aid offer letters alongside or shortly after they receive their acceptances in March or April. Deciphering those letters is a challenge of its own—when the time comes, check out our explainer here.