What’s the Price?

Kyle McIntosh

DRIVE TO HOSPITAL. Cut the umbilical cord. Figure out names. Open a 529.

While the primary focus upon our two babies’ births was bonding, I had another item to check off: I opened a 529 college savings account for each one within a month of their births.

It’s paid off handsomely. Through automatic monthly contributions—plus stellar market performance over the past decade—they’ve amassed sizable balances for higher education. One child now is in high school, the other is a middle-schooler. Based on what we’ve already accumulated, I’m considering pausing future contributions to their 529s.

Why? At this point, I see two likely scenarios: We’ll either overfund our 529s—or we’ll wind up with a serious shortfall. I know that sounds confusing, but it all depends on which colleges they attend. To decide whether to continue contributing, I’ve been researching what their colleges might cost. And the answers I’ve found are confounding.

Unlike most other areas of financial planning, college presents parents like us with a staggering range of possible costs. For example, the average cost for four years of public college is now about $105,000 for in-state students. The comparable cost for a private college is $220,000, according to These figures include room and board. If either child decides to attend a local community college for the first two years—a viable option in our area—the four-year cost could drop to around $65,000.

I consider myself to be well-versed in financial planning and higher education. After all, I’m a college professor. Still, the incredible disparity in average college costs leaves me surprised.

Just to make it more difficult, these figures I’m quoting are averages. Many schools’ published prices are much, much higher. The full cost for football rivals Notre Dame and the University of Southern California (USC) in 2021-22 are $58,843 and $60,446, respectively. Add in room and board, and the cost balloons to about $320,000 for four years at both colleges.

The main difference between the full cost and the average cost charged are explained by tuition discounts. According to, the average tuition discount rate was 48.1% for the 2020-21 school year.

I recently spoke to the vice president of admissions for a private university in the southeast. This person said that private universities provide discounts to nearly all students to improve affordability and to attract top students. The discounts usually only apply to tuition, however, so room and board are still full fare.

Naturally, I would welcome tuition discounts for my children. But discounts or not, I won’t actually know how much my kids’ colleges will cost until about six months before freshman orientation. Until then, we’re flying blind on the true cost of college.

One final wrinkle: Inflation in college costs will surely lever up our bills. Four-year college costs rose 2.2 percentage points a year above the inflation rate between 2010 and 2020, according to the College Board. If general inflation averages 3% over the next six years and college costs climb two percentage points faster, the average in-state rate for a public school would jump from $105,000 to $141,000 for four years. (I chose six years from now because that’s the midpoint of my high-schooler’s college career.) Using the same factors, the average cost of a private school would jump from $220,000 to $295,000 for four years. What about the $320,000 four-year, full-fare price for the likes of Notre Dame and USC? That could jump to a shocking $430,000.

The bottom line: The possible college cost for my oldest child ranges from $65,000 to $430,000. It’s as if I’m saving to buy a car without knowing if I’ll be driving off the lot in a Honda Civic or a Lamborghini Countach.

Given this uncertainty, I plan to act conservatively. I’ll keep contributing to both kids’ 529 accounts at our current pace. In a few years, we’ll know the cost of our oldest child’s college. If we’ve oversaved—is that even a word?—we can transfer leftover funds to our younger child’s 529 and do the confounding college scenario planning all over again.

Kyle McIntosh, CPA, MBA, is a fulltime lecturer at the California Lutheran University School of Management. He turned his career focus to teaching after 23 years working in accounting and finance roles for large corporations. Kyle lives in Southern California with his wife, two children and their overly friendly goldendoodle. Follow Kyle on Twitter @KyleGMcIntosh and check out his earlier articles.

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