How Much Should You Save for College?
At the start of your senior year in high school, how you’ll pay for college may not be a high priority yet. It’s something you should be thinking about, though, as you consider different colleges and the costs associated with attending each one.
A national study, How America Pays for College 2017, shows that the average student contributes 11% to the total cost of his or her college education. That is money from the student’s income and savings, not student loans.
So, how much should you plan to save for college this year?
That answer depends on a multitude of different factors, but the easiest response is “as much as possible.”
If you want a more precise number, though, there are things you can do now to determine how much you want to save during the next 12 months.
Create a Budget
Use an in-school budget tool to start forming an idea of how much money you’ll need to live on each month. It’s OK to guess right now and try out different calculations. How much will you cover with grants, scholarship and student loans, and how much will you need to have on hand each month for your extra costs?
If you live on campus in a dorm during your freshman year at college, many of your expenses will be set and you’ll be left with a smaller number of variable categories. But if you’ll be living off campus, you will have to calculate additional costs like your portion of the monthly rent, gas and car maintenance, and how you will fill a refrigerator.
Figuring out how much you will need each month can help you set a goal for the amount you definitely want to save during your senior year.
While you’re creating different in-school budget scenarios, be sure to consider the costs needed for different schools you’re considering. Less-expensive schools might seem like the way to save money, but many times those institutions also have less money to offer in terms of scholarships and grants compared to more-expensive colleges or universities.
Anticipate that you will need more spending money than you think to ensure you don’t greatly underestimate how much you will need to save.
Is your budget a lot higher than you expected? Check out these ideas for ways to save on supplies. Will any of those options help reduce your monthly budget?
You can also consider options such as:
- Living at home and attending a community college for your first year or two to meet your general education requirements.
- Planning to work part-time during college to help you cover some monthly expenses.
- Cutting back on entertainment or other non-necessities to reduce the amount needed for spending money each month.
It may seem like a daunting task, but the more you’re able to save for college today means less that you will have to borrow in the future.