Taxes and college savings · calculator
College savings calculator
To cover four years at a net price of $30,000 a year in today's dollars, starting in ten years, a family that has $10,000 saved would need to set aside about $980 a month, assuming costs rise 3% a year and savings earn 5%. Started at birth, sixteen years out, the same goal would take about $687 a month; started five years before college, about $2,140. Time does most of the work, which is why the monthly figure falls so fast with an early start. The calculator adds up the future cost of each year of college separately, since the fourth year is paid later and at a higher price than the first, then subtracts what your current savings may grow to and spreads the gap over the months left. Every rate in it is your assumption. The cost to use is the net price after grants, not the sticker price, and the money saved reduces the need for loans at a time when federal borrowing for parents is capped at $20,000 a year per student.
Monthly saving needed
$980
To cover $168,673 of future costs
| Future cost of all years | $168,673 |
| What today’s savings may grow to | $16,470 |
| Gap to fill with monthly saving | $152,203 |
Every rate here is your hypothesis. The goal counts each year of college at its own future price. How this is calculated.
Work backward from the yearly net price of college to the amount to put aside each month, with your own cost and return assumptions.
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Start date and monthly effort
The table keeps the same goal, four years at $30,000 a year in today's money with 3% yearly cost growth and a 5% return, and changes only the number of years before college. The monthly amount needed when nothing is saved yet shows why the first years matter most.
| Years before college | Future cost of four years | Monthly saving needed |
|---|---|---|
| 18 | $213,670 | $612 |
| 14 | $189,843 | $783 |
| 10 | $168,673 | $1,086 |
| 6 | $149,864 | $1,789 |
| 3 | $137,147 | $3,539 |
How the calculation works
Each college year is priced at today's cost grown by your inflation assumption up to the year it is paid, so a four-year degree that starts in ten years is priced at years ten, eleven, twelve and thirteen. The total is the goal. Current savings are projected forward to the start date at your return assumption and subtracted. The gap is divided by the future value of saving one dollar a month until college starts, which gives the monthly amount. The simplification is that all the money is assumed to be ready on the first day of college; in practice the last years' costs can keep growing in the account while the first years are being paid, so the result errs on the cautious side. Raising the return assumption lowers the monthly figure, and raising cost growth raises it; the two often move together over long periods, so testing both high and both low gives a fair range. Revisit the plan each year with the real balance instead of the projected one.
Where the net price comes from
For most families the right input is not the published cost of attendance but what is left after grants. A student who qualifies for a Pell Grant, up to $7,395 for 2026-27, faces a much lower net price at the same college than one who does not (Public Law 119-75). The SAI calculator estimates the Student Aid Index that drives need-based aid, and the net price page shows how to combine it with a college's own figures.
Savings and the 2026 borrowing caps
Saving matters more than it did a few years ago because borrowing is tighter. Parents can no longer borrow up to the cost of attendance through parent PLUS: from July 1, 2026 the limit is $20,000 a year and $65,000 in total per student (HEA section 455(a)(5)). Graduate school is capped too. A family that expects a gap larger than those limits has to fill it with savings, earnings, institutional aid or private credit, and the loan limits calculator shows exactly what federal loans can still cover.