Let’s say the sticker price for your dream college is $35,000 per year—this includes tuition, fees, room and board charges, and an allowance for books, supplies, transportation and personal expenses.
Now let’s say that you can’t afford to pay $35,000 to attend this school, but you really like the school and want to seriously consider it if you are accepted.
The good news: You shouldn’t focus on this full cost when determining what you can afford! Instead, the net price will give you a better idea if this dream school is within reach. Read on to learn more about how net price can give you a better idea of how much your health care education will actually cost you.
Sticker Price – (Grants + Scholarships) = Net Price
The net price represents your family’s actual cost to attend college after eligible grants and scholarships are subtracted from the sticker price. In accordance with The Higher Education Opportunity Act (HEOA), each postsecondary institution that awards financial aid is required to post a net price calculator on its website, which means it’s easy for you to determine estimated net price by simply completing a series of questions that may include:
- Your parent(s) earnings in wages and salary
- How much money your family has in cash, savings and checking accounts
- Current value and purchase price of your home, if you own a home
Your grades and test scores, if the institution awards merit aid (scholarship money based on academic performance)
The Pros and Cons of the Net Price Calculator
The net price gives you an early estimate of how much you may be expected to pay and knowing this price earlier rather than later can give you an opportunity to budget and plan accordingly.
That being said, the calculator has its critics. According to a report by the Federal Advisory Committee on Student Financial Assistance, the calculators are not standardized and vary in configuration and type of questions. You can’t compare the net price of one college to another if different questions are being asked.
In response to this concern, the U.S. Department of Education created a Financial Aid Shopping Sheet to standardize the information in the net price calculator and financial aid awards. Five hundred institutions have voluntarily adopted the form. This resource may make it easier for families to compare the cost of one college to another.
Your dream college may or may not be within your reach. Having an honest discussion with your family about what is and is not affordable early in the process is a good way to reduce any disappointments about where you ultimately choose to enroll.