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Why is the cost of college different for every student?

Nov 27, 2020

When people buy things, they know the price and act accordingly. For inexpensive stuff, Apple-pay, a debit card or cash is offered without much analysis. With increasingly more expensive items, such as a TV, a car, or a house, consumers research. They consider options and shop around to determine what is affordable and how to pay the bill.

This is true for nearly all consumer transactions — except for purchasing an education.  Too many families fall into the trap of enrolling in a dream college or a brand name school without thinking through the financial implications. The result is $1.7 trillion of student loan debt and many unnecessarily distressed families.

To avoid this, it is helpful to think about consuming education and understanding a whole new language, acronyms, and factors to consider BEFORE enrolling in college.

Key Terms

Expected Family Contribution (EFC):

The dollar amount the US Department of Education calculates that a student and his/her parents should contribute to pay for college. The EFC is not a cap on the family’s contribution and colleges are not obligated to offer financial aid for the difference between the cost of college and the family’s EFC.

Sticker Price:

Just as on a new car, the Sticker Price is the price the college advertises as the cost of its product. You can find it on the college’s website.  The Sticker Price is the average cost to attend the college for one year, including tuition, fees, room, board, transportation, living expenses, books, and supplies – together known as the Cost of Attendance.

Net Price:

Just as with a new car, not many people pay the Sticker Price.  Students pay the Net Price, which is the Sticker Price less the amount of the financial aid awarded to a student.

The real cost of college

The truth is that the cost of college is different for every student. Sometimes, substantially different. To start, each student has a different financial aid package based on their family’s unique financial circumstances. Even if all students paid the same tuition, they have choices for room and board. Some choose to live at home, others in dorms or apartments.  They will also have to choose a meal plan and incur other highly variable expenses such as travel, living expenses, books, etc.

A student’s true cost of college is their Net Price plus all of the incidental variable expenses including Sorority or Fraternity Fees, books, travel, etc.

Saving money on variable expenses


According to the College Board, the average full-time undergraduate at a four-year college spent $1,240 on books in the 2019-20 school year. Costs are rising in this school year because of the corona virus making it all the more beneficial to shop around and be creative. The college bookstore is convenient, but there are most likely cheaper options. 

Online bookstores are a great source for finding new and used books, often with options to rent or buy a used book at a discounted price. Some professors may also put materials on reserve in the college library so students can have free access to the materials.  Digital books and loose-leaf versions of a book can also trim costs.

To reduce the total cost of books: sell books at the end of the semester, either online or at a textbook buy-back event.

Transportation and Travel

Whether going to college in-state or across the country, transportation is necessary. Setting price alerts in advance for air travel might help reduce the cost. Also, college websites may offer discounts at nearby hotels and area businesses. 


Each college has its own system for meal plans. Understanding the options and picking a plan which fits a student’s eating habits will save money. Some have à la carte plans; others offer all-you-can eat options. Some campuses offer flexibility so switching plans in the second semester may be wise.

In any case, few students are able to eat all of their meals on campus. Budgeting for meals not included in a meal plan is a reality for all students.

Student Discounts

Students may sign up for student reward programs with major companies such as Adobe, Amazon, Spotify, and Verizon. These companies and others often offer substantial discounts of up to 50% off for students with an Edu email address.

A Final Thought

Consuming education is expensive, but it does not have to end in financial ruin or excessive student debt.  Unlike purchasing a TV, car or house, the cost of purchasing a college education sometimes varies among consumers for the same result: a diploma.  

Choosing smartly among options along the path to graduation will yield a better return on the family’s investment in a student’s education.