Expected Family Contribution—Calculate How Much You’ll Pay for College

Do you have a high school freshman or sophomore student?  Have you started thinking about the cost of your student’s college education, and what you’re on the hook for in just a few short years?

You can know how much you have to pay for college, and build a strategy around it.

Parents of seniors (and many juniors) are diving into the nitty-gritty of financial aid applications.  Yet, this is a good time for parents of 9^th and 10^th grade students to start lining up financial resources for what will likely be one of the most expensive purchases in your life.

Don’t be worried about which schools your student can get into, or how much of an aid package those schools will provide.  We can determine that later, as test scores, grades, and college aid packages develop.

The goal right now is to figure out your Expected Family Contribution or EFC—that’s a real, concrete thing you can measure and start planning around!

The EFC is not usually the exact amount you’ll pay for college, but it is the starting point all schools use.  And it’s our starting point for strategies to reduce what you pay for college.  The EFC also helps with your college selection strategy, if your child is looking at more than one school.

But, first, we need to calculate it.

There are really two different EFCs: one used by the majority of public and private colleges (using what’s called the Federal Methodology), and one used by a group of mostly private schools covered by the CSS/Financial Aid PROFILE (called the Institutional Methodology).  What’s nice is that you can use a calculator to get an answer for both methods at once.

To start, you only need a few items: your previous year’s tax return, and current balances for you and your student on any assets (checking and savings accounts, home mortgage accounts, investments).

The College Board provides an EFC calculator that is easy to use and trustworthy.  Let’s go through the steps:

1. Visit the College Board site for their EFC calculator.
2. Start the calculator, and make sure you select “Both FM & IM” on the Formula page, so that you get both methodologies.
3. Follow the prompts for all the amounts to enter and questions to answer. If you are unsure about a specific question, the little blue question mark icon should provide guidance.

Next Steps for College Planning

It’s really that easy!  Ten minutes of work, and you’ve got an estimate of how much colleges will expect you to pay.

Do you want someone to look over your shoulder, or double-check your work?  Give us a call.

Finally, remember this will likely not be what you pay for that first year of your son’s or daughter’s college.  The school will put together an aid package, which may include some combination of merit scholarships, grants, and yes, loans.  There are a number of ways to pay less than the EFC.  Check out this article from the College Board as a good overview.

You’ve done the EFC calculation, that’s a good first step!  Want to learn more about college planning, and how a smart strategy can save you thousands and ensure the right school fit for your child?  Set up an appointment.