College Cost Calculators: Are They Accurate?
College sticker prices are meaningless.
Most parents, however, don't know that. Families routinely shop by looking at published college costs even though colleges and universities routinely offer bargain discounts.
Higher-ed experts, however, are hoping that college cost confusion might not last too much longer. Why? Because colleges are facing a deadline to install calculators on their websites that will provide individual families with a good idea of what they will have to pay based on their own circumstances.
The federal government is requiring colleges to install so-called net price calculators on their web sites no later than October 2011. Not all net price calculators, however, will necessarily be worth using. At least that's the conclusion I've drawn after asking experts about the calculator requirement.
College Cost Calculator Problem
Here's the problem: the federal government released a calculator template, which colleges are welcome to use, that is flawed. The federal calculator asks families few questions and is so generic that it will produce wrong numbers for many parents.The federal calculator, concludes a white paper by Maguire Associates, a higher-ed consulting firm, "has the potential to be grossly inaccurate due to its simplicity." The Association for Institutional Research issued an alert that the federal calculator may not be as accurate for many institutions, especially for those that hand out lots of large scholarships and other merit awards. Most private schools would surely fit into that category. Sandy Baum, the College Board's senior policy analyst, told me that she's concerned about the one-size-fits-all nature of the federal calculator template.
Jeff Whorley, the president of StudentAid.com, which is creating custom calculators for at least 42 colleges, agrees with the critics. Whorley says his company analyzed the federal calculator using 145,000 actual student profiles and concluded that the calculator was inaccurate 65% of the time.
College Calculator Alternatives
Rather than use the federal model, some colleges are developing their own calculators. Dozens of schools, including Albright College, Bradley University, Purdue University, University of Arkansas, Williams College, already have their calculators installed on their websites.So what's the bottom line? In many cases, schools that create their own net price calculators are probably going to produce more accurate numbers. So before you believe the aid figures that a college's net price calculator spits out, ask where they came from.
Lynn O'Shaughnessy is the author of The College Solution, an Amazon bestseller, and she also writes for TheCollegeSolutionBlog. Follow her on Twitter.
Net price calculator image by afrosweded. CC 2.0.
