College Tuition Planner

College planning fails in a specific way: people project their savings carefully and then measure them against today's published cost. Costs are not static, and education costs have historically risen faster than general prices, so a plan that looks fully funded against current figures can be materially short by the time the first bill arrives.

This planner keeps three quantities apart, because conflating them is where the error creeps in. The sticker cost is the annual figure you enter today. The projected cost is that figure inflated to each academic year it actually falls due — including the years during college, when inflation keeps running. The planned funding is your savings, your future contributions and the growth on both. The difference between what savings are targeted to cover and what they can actually cover is the funding gap.

It is a planning tool, not an eligibility tool. It does not estimate financial aid, calculate a Student Aid Index, or produce a net price for any institution. If you know a scholarship or family contribution is coming, you can enter it, but that is your figure rather than an estimate Quantus made on your behalf.

The projected first-year cost is usually the number that changes the conversation. Ten years of 5% inflation multiplies a cost by roughly 1.63, so a $24,000 figure arrives as $39,093 — and because inflation continues during college, the fourth year costs $45,256 rather than the same $39,093 again. The total is a sum of four different numbers, never the first year multiplied by four.

The funding target is deliberately yours to set. Not every family intends savings to cover the whole bill; income during the college years, work, and family help often carry part of it. Setting the target to 75% or 50% changes what counts as a gap, and the result reports the target amount separately from the total projected cost so the two are never confused.

The coverage sentence under the headline is the one to read carefully. A total gap tells you the size of the problem; it does not tell you when it bites. On the default plan, savings cover college years 1 and 2 completely and $15,769 of year 3 — which is a very different planning problem from being 43% short across the board.

The sensitivity table exists because the two assumptions that matter most pull in opposite directions. A point of extra cost inflation and a point of lower return both widen the gap; a favourable move in one can mask an unfavourable move in the other. Reading the corners of that table tells you how robust the plan is far better than the central figure does.

Each academic year's cost is today's cost compounded forward to the year that bill falls due. The first year is inflated by the years until college; each subsequent year by one more, so the total is the sum of individually projected years.

Savings are rolled forward period by period at the expected return. During the accumulation years, growth is applied and then the contribution is added, which is the convention every Quantus tool uses. During the college years the bill is settled at the beginning of the academic year and only the remaining balance earns a return for that year — the money spent in September does not earn a return for the year it was spent in.

On tax: this planner does not contain a tax engine, and it deliberately has no 'tax rate on growth' input. For a qualified education account that input is usually wrong — distributions used for qualified education expenses are generally free of federal income tax — while for a taxable account the right adjustment is to the return itself. Enter a return that is already net of the tax and fees your account actually pays, and read IRS Publication 970 for how education accounts are treated.

Take a current annual cost of $24,000, ten years until college, four years of attendance, 5% cost inflation, $15,000 already saved, $400 a month going in, and a 6% return, with savings targeted to cover 100% of the bill.

The first year projects to $39,093 and the fourth to $45,256, for a total of $168,498. Savings reach $91,852 by enrollment — $15,000 of starting balance, $48,000 of contributions and $28,852 of growth.

Because the balance keeps earning during college, $95,910 of the bill is ultimately paid from savings: years 1 and 2 in full, and $15,769 of year 3. The funding gap is $72,588, or 43% of the target. Closing it requires $783.69 a month rather than $400 — an extra $383.69, and a figure the solver reaches by narrowing the bracket to within fifty cents and then confirming the residual gap is zero.

The table below isolates the single assumption doing the most work here: the cost inflation rate.