In America, there is a direct correlation between education and income. On average, people make more money with every degree they earn — but the benefits of education go much farther than just beefier paychecks. Well-educated people are more likely to own their own homes, according to Habitat for Humanity, and they’re more likely to want to help improve their community.
In the United States, the government is required to provide every child with free schooling through 12th grade — free on paper, that is. Even when it’s provided as a public service, education comes with costs.
Education — and All the Related Expenses — Start Early
A June study from Care.com revealed what millions of Americans already knew — that the pandemic put the already exorbitant cost of child care even farther out of reach. The average weekly rate for a toddler in a child care center nearly doubled from $182 in 2019 to $340 in 2020. In 2021, a full 85% of parents are now spending 10% of their income or more on child care and more than half plan to spend more than $10,000 in 2021.
Preschool Can Be Incredibly Expensive — or Free
Working parents who are waiting for preschool to provide sweet financial relief from their heavy child care bills might be disappointed. According to a BabyCenter report based on data from the National Association of Child Care Resource & Referral Agencies (NACCRRA), the average cost of private preschool runs from $4,460 to $13,158 per year, or $372 to $1,100 a month — about the same as child care.
Depending on where you live, however, you might pay nothing at all.
According to ChildCare.gov, many states offer free or low-cost pre-k/preschool as part of their public school system, as do many individual schools, nonprofits, places of worship and child care centers.
Sorry, but It’s Already Time To Start Saving For College
Sure the kids look small now and sure money is tight, but they won’t be small for long and there will never be a time when saving is easy. Every year that you wait to open a 529 college savings plan is a year that you’re missing out on the power of tax-free compounding.
You can open an account with little or no initial deposit, you don’t have to make regular contributions and grandparents or anyone else can contribute, too. Open one now and you’ll be able to make qualified withdrawals tax-free when it’s time for college — and it will be time sooner than you think.
What It Really Costs To Educate a Child
Every state in America must provide free K-12 education to every child in the state. Many parents, however, choose to pay for private school. If they do, they should expect five-figure tuition bills — but even if they don’t, the hidden costs of public school won’t stay hidden for long.
Private School and Homeschooling Are Costly Alternatives
If you are considering private school, here’s what you can expect to pay by grade level, according to Private School Review:
- National average private school tuition: $11,659
- Average private elementary school tuition: $10,664
- Average private high school tuition: $15,140
Just as with public colleges — more on that shortly — private school tuition varies wildly by state. In the cheapest state, South Dakota, the average is $3,624 per year. In the most expensive state, Connecticut, it’s $26,231. If you’re considering homeschooling, Kiplinger reports the average cost of at-home instruction to be between $700-$1,800 per child per year.
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Either Way, Lots of Shopping Is in Your Future
The pandemic fast-tracked the integration of tech in the classroom, and parents are paying the price. According to global professional services giant Deloitte, the meteoric rise of education technology has fueled a 37% year-over-year increase in tech sales compared to 2020. Parents will spend $32.5 billion on school supplies in 2021 for an average of $612 per child, according to the report, much of which is fueled by not just tech, but the realities of education in the age of COVID-19, in general.
“When virtual school started, we borrowed computers from their school, but I had to provide art supplies, things to house those supplies, and lots of materials that we rely on their classroom having,” said Make More Adventures blog author Lanie van der Horst, who spent 11 years as a middle school special education teacher before having her own two children. “I had sent most of the needed items to school with my kids at the beginning of the year, but we found that we needed to purchase more as we were not given the materials back.”
According to Statista, the average parent in 2021 spends the most on these four back-to-school needs:
- Electronics and computer-related equipment: $295.65
- Clothing and accessories (shoes excluded): $253.46
- Shoes: $161.04
- School supplies: $138.75
Sports Pay Lifelong Dividends, but Come With Upfront Costs
A 2020 report from Ohio University makes clear the potential ROI of organized youth athletics. Kids who play school sports are more likely to go to college, earn higher salaries (at age 30) and report higher levels of confidence, leadership skills and self-respect well into adulthood — but it often requires a big upfront investment.
On average, parents spend $671 per year on school sports, with 2 in 10 spending more than $1,000 per child per year for things like uniforms, equipment and registration fees. That’s why kids from families with incomes greater than $60,000 are much more likely to play school sports than kids from lower-earning households.
Don’t Forget About Activities, Music, Field Trips, Dances and the Rest
The fun part of school — the trips and field days and off-site activities — has a way of nibbling at your wallet in small little bites that add up quickly from the very beginning.
“When parents hear about field trips for their kids, their first reaction is typically that of delight,” said Daren Nadav, co-founder and CEO of Courseforme.com. “But they seldom realize how much money it can cost them. Usually, field trips consist of visits to the nearest museum, park, or zoo, which can cost parents anywhere from $50 to $200, depending on entry costs and food for their children. However, there are trips to other cities/states as well, which can cost parents up to $1,000 dollars, including airfare and lodging.”
The same goes for all kinds of extracurricular activities that schools usually offer but rarely pay for.
“Most high schools charge parents for these activities, consisting of sports, arts, theater, and music, among others,” Nadav said. “In addition to buying the required material for such activities, such as sports gear and musical instruments, parents have to pay for their children to get special lessons.”
Then there are dances, which teens spend far more money on today than their parents did a generation ago, according to Money.com. By the middle of the 2010s, the average family was spending around $1,000 on prom alone.
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College Expenses Actually Start in High School
The pressures and price tags of college start making themselves known long before a student ever even graduates.
“My daughter took mostly AP classes in high school,” said Dr. Michelle Facos, professor of art history at Indiana University-Bloomington. “Neither I nor her father understood that AP credit helped with advanced placement in college classes only if one takes the standardized AP exams.”
The AP exam costs $95, according to the College Board, but can cost as much as $143 for AP Research or Seminar exams — and the fun doesn’t stop there.
- Advisors, like those writing for Ivy Wise, say that most students should apply to 12-15 different colleges. The average college application fee costs $44, but the pricier applications average out to $78, according to U.S. News and World Report. Even at $44 each, that’s $528-$660 in application fees alone.
- SAT prep courses like those from Princeton Review and Kaplan start in the $700-$800 range and can run well over $1,000.
- The SAT registration fee is $55, according to the College Board, but there are other fees for things like changing your test date and forwarding score reports to your colleges.
- According to Finder, tutoring for college entrance essays alone can cost $100-$500.
- Finally, it’s unlikely you’re going to commit to a school you’ve never seen, which means you’ll be required to visit several colleges. If you’re applying out of state, travel can and accommodations can obviously get expensive quickly.
Higher Education: The Many Different Costs of College
Corporatized and commercialized yet swimming in public money, America’s higher education system — which is run differently in 50 different states — is more complicated and expensive than just about anywhere else in the developed world. Over the last 50 years — but the last two decades, especially — the cost of college has soared.
“College tuition is so expensive because back-end costs at colleges have risen and because colleges are chasing higher rankings,” said Antonio Cruz, a mentor with Ivy Scholars, a private college consulting company. “The simplest way to increase a college’s ranking is to spend a lot of money, and that has to come from somewhere, thus the increase in tuition costs. This is worsened by an increase in accessibility in student loans, and a decrease in state and federal funding for education.”
Get a Deal: The Best Colleges With Tuition Under $20K
Tuition: You Won’t Usually Pay the Published Rate
According to the College Board, the average published — or sticker — tuition prices for four-year colleges and universities in 2020-21 is:
- Public four-year in-state: $10,560
- Public four-year out-of-state: $27,020
- Private nonprofit four-year: $37,650
In America, however, the vast majority of full-time undergrads won’t pay the published price of tuition thanks to gift aid like grants and scholarships. Unlike students loans, this category of financial aid doesn’t have to be repaid.
Grants and scholarships can be public or private and can be awarded by schools, nonprofits, businesses, foundations, individuals or governments. They can be awarded based on need or merit or can be reserved for a specific population like women, African-Americans or members of the LGBTQ+ community. You can often apply for more than one at the same time.
According to the College Board, the average net tuition — the true cost that a student pays after grants and scholarships — in 2020-21 is:
- Four-year public (in-state): $3,230
- Four-year private nonprofit: $15,990
In-state public schools are always cheaper, but how cheap depends on your state. In Vermont, the average is $17,510. In Wyoming, it’s $5,790 — but there’s another way to earn a degree for even less.
Community College Is the Backbone of Affordable Higher Education in the US
According to the College Board, the average published tuition for America’s nearly 1,000 public community colleges is $3,770 for in-district students. But when it comes to net price — what students actually pay — the College Board made this statement: “Since 2009-10, first-time full-time students at public two-year colleges have been receiving enough grant aid to cover their tuition and fees.”
In other words, community college is often free.
Community College: An Alternative or a Stepping Stone to a 4-Year Degree
For millions of Americans, community college is a free or low-cost way to earn a certificate or a two-year associate’s degree. But others transfer to a four-year school after graduation and use their associate’s degree to satisfy the first two years of a four-year bachelor’s program. The degree and diploma are exactly the same no matter where you spend your first two years.
“Taking a ‘2+2’ path through college — where you spend your first two years at a community college and your final two years at a four-year school — could lead to significant savings,” said Rebecca Safier, a certified student loan counselor and higher education expert at Student Loan Hero. “You can enjoy the lower tuition costs of a community college while still graduating with a bachelor’s from your choice of four-year colleges.”
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Consider Student Loans Only as a Last Resort
America is Student Debt Nation, and if you’re considering taking on loans to pay for college, you must include that debt — and the decades it could take to pay it off — when deciding whether the cost of college is worth the potential increase in lifetime earnings.
According to Forbes:
- About 45 million borrowers owe a record $1.71 trillion in student debt
- The average debt is $37,693
- More than 11% are delinquent past 90 days
- 5.5 million are in default
Consider student loans only after you’ve exhausted all grants and scholarships, apply for federal loans before private loans — and always borrow as little as possible.
“When it comes to student loans, it’s important not to bite off more than you can chew,” said Donald Ruff, director of college planning and postsecondary initiatives for The Eagle Academy Foundation, a network of schools serving young men of color in New York City.
In many cases, that simply means forgoing the big-name schools that come with bragging rights.
“Unfortunately, the prevailing myth in this country is that you must attend a prestigious college or university to climb the socioeconomic ladder,” said Andrew Pentis, certified student loan counselor and debt expert at Student Loan Hero. “That’s just not the case. Families should consider not following the crowd and charting their own path, perhaps a b-line to their local college, which costs significantly less and could still lead them to the career and earnings they’re seeking.”
If you do borrow money to pay for a degree, make sure you actually come away with the degree.
“Almost half of all students who pursue higher education don’t graduate and yet are saddled with debt,” Ruff said. “Meaning you need to be thoughtful about the options available to you and work to get the debt you’re taking on as close to zero as possible.”
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Last updated: Aug. 9, 2021